Intermediary Module
NEXUS PLATFORM RULES FOR INTERMIEDARY MEMBERS
1. General
1.1 An Intermediary Participant is entitled to execute orders received from its clients on the Nexus Platform. Chintai will decide on the acceptance at the request of the entity.
1.2 A list of Intermediary Participants is published on the Nexus Platform.
1.3 Chintai will have no contractual relationship with clients of Intermediary Participants and it is the responsibility of each Intermediary Participant to ensure that its clients are informed of, and act in compliance with, the Rules.
1.4 An Intermediary Participant must ensure that it enters into a written agreement with each of its clients importing all the terms of the Rules insofar as they are applicable to the client, and with regard to the business carried out for the client, to enable the Intermediary Participant to comply with all the requirements of the Rules.
2. Grant of access to Intermediary Participant
2.1 An Intermediary Participant will be granted access to the Nexus Platform if all the following eligibility criteria are met:
2.1.1 The entity validly exists and is operating under the laws of its establishment;
2.1.2 If applicable, it holds and maintains relevant financial sector authorisation(s) from the relevant Regulatory Authority;
2.1.3 It has access to the application and systems of the Nexus Platform, and holds the technical capability to maintain such access; and
2.1.4 It has the necessary staff, systems, and controls to act as an Intermediary Participant.
3. General obligations
3.1 An Intermediary Participant must at all times:
3.1.1 Comply with the Rules, laws, and regulations applicable to it;
3.1.2 Continue to satisfy the eligibility criteria;
3.1.3 Adhere to the principles of good business practice, including dealing fairly with its clients;
3.1.4 Maintain procedures and systems to prevent any breach of the Rules and regulations;
3.1.5 Have robust security arrangements in place to ensure that unauthorized persons are denied access to the Nexus Platform, and are unable to access or change order and trade data;
3.1.6 Inform Chintai of any prohibitions, restrictions, or requirements under applicable laws for providing the Intermediary Participant’s services;
3.1.7 Cooperate with Chintai and any Regulatory Authority in relation to any query, investigation, or client complaint regarding trading activities on the Nexus Platform; and
3.1.8 Comply with FATCA, the Common Reporting Standard, and other similar international tax compliance reporting and information exchange requirements.
3.2 When handling client orders, an Intermediary Participant must, in accordance with the principles of best execution:
3.2.1 Exercise due skill, care, and diligence in the best interests of its clients;
3.2.2 Act in good faith;
3.2.3 Not enter into a transaction which may conflict with a duty owed to the client; and
3.2.4 Have processes in place to review orders and trades for the purpose of detecting and reporting errors and suspicious trading behavior.
4. Cancellation of access
4.1 Chintai may cancel an Intermediary Participant’s access to the Chintai Portal at its own initiative or at the request of an Intermediary Participant.
4.2 Chintai will cancel access without any prior notice:
4.2.1 At the order of an appropriate Regulatory Authority; or
4.2.2 If the Intermediary Participant violates the Rules, including not meeting the eligibility criteria, and it has not remedied the breach within the timeframe provided by Chintai.
5. Operational Requirements
5.1 An Intermediary Participant must ensure that:
5.1.1 Its systems and connections to the Nexus Platform operate properly at all times and have adequate redundancy and scalable capacity to accommodate current and anticipated trading volume levels; and
5.1.2 It complies with the terms and conditions, and any other requirements imposed by Chintai, for accessing the Nexus Platform or in relation to order management systems or for any other purpose.
6. Direct Market Access
6.1 An Intermediary Participant may authorize direct market access for its clients in respect of the Nexus Platform, including through an approved order management system through which orders are routed to the Nexus Platform, subject to such conditions and requirements as may be specified in the Rules or prescribed by Chintai from time to time.
6.2 An Intermediary Participant that authorizes direct market access for a client must enter into a legally binding agreement with the client setting out the terms and conditions for such direct market access.
7. Responsibility to Chintai
7.1 An Intermediary Participant is responsible to Chintai for the acts and omissions of its directors, officers, representatives, employees, and agents.
8. Records for Compliance
8.1 An Intermediary Participant must maintain proper, complete, and accurate records and audit trails, including a complete audit trail of transactions, whether entered into for itself or the Intermediary Participant's clients, from the receipt of an order to its settlement to evidence compliance with the Rules
8.2 An Intermediary Participant must make records available to Chintai at such time as Chintai prescribes or otherwise requires. The Intermediary Participant must obtain the necessary client consent for such disclosure, prior to such disclosure being made.
9. Client Accounts
9.1 Prior to opening a client account, an Intermediary Participant shall satisfy itself that it has:
9.1.1 Verified the identity of each client, and in the case of a non-individual client verified that it is validly constituted and that the person opening the account has the requisite authority to do so, and in the case of an agency client, verified the identity of the principal and the client's authority to trade for its principal;
9.1.2 Verified that the client meets the following criteria;
(a) Satisfies such classification of investor in the relevant jurisdiction in which he is based such that his participation on the Nexus Platform through the Intermediary Participant shall be in compliance with such requirements as may be prescribed by the Relevant Regulatory Authority;
(b) (If an individual) is not an undischarged bankrupt;
(c) (If an individual) is at least 18 years old;
(d) Is not a U.S. Person; and
(e) Has passed all relevant checks with respect to anti-money laundering and countering the financing of terrorism, in accordance with applicable know-your-client laws and regulatory requirements.
9.2 Before opening a client account for a client under the age of 21, an Intermediary Participant shall assess the client's suitability to trade and disclose the risks of trading to the client.
10. Proprietary Account
10.1 All purchases and sales of Tokens by an Intermediary Participant for its proprietary account must be made under a separate trading account from that of the intermediary trading account on the Nexus Platform which it uses to trade on behalf of its clients.
10.2 An Intermediary Participant must have procedures to effectively prevent any conflict of interest between its client trading activities and proprietary trading activities.
11. Acting as Principal to Client
11.1 If an Intermediary Participant wants to trade as principal with a client, the Intermediary Participant (where the Intermediary Participant is the one so trading) may only do so on its separate trading account from that of the intermediary trading account and must inform the client that the Intermediary Participant is acting in the transaction as principal and not as agent.
12. Arrangement with Clients
12.1 An Intermediary Participant must not:
12.1.1 Accept a share in the profits of a client's account carried on the books of the Intermediary Participant or have an arrangement with a client to share in the profits of that account;
12.1.2 Have any arrangement with a third party to allocate profits or losses to a client's account carried on the books of the Intermediary Participant; or
12.1.3 Leads a client to believe that the client will not suffer loss as a result of opening an account or dealings.
13. Record of Orders
13.1 An Intermediary Participant must ensure that a daily record of orders received from clients is maintained. The record must show the account identification of each client, the specific order, the date, and the time the order was received, transmitted, amended, and executed or canceled. The record may be electronically stored.
13.2 An Intermediary Participant must have adequate security measures in place to prevent unauthorized access to and/or tampering with the audit trail of orders entered into the Nexus Platform.
14. Responsibility for Orders
14.1 An Intermediary Participant is responsible for the accuracy of all orders entered into the Nexus Platform by its personnel and any dealing assistant.
14.2 Orders must be entered in accordance with any procedures Chintaiprescribes.
14.3 An Intermediary Participant must have in place controls to prevent unauthorized changes to order information entered into the Nexus Platform, including identification numbers for its trading personnel.