SPECIAL CONDITIONS FOR FINANCIAL CONTRACTS FOR DIFFERENCE ("CFD special conditions")

Transcription

1 SPECIAL CONDITIONS FOR FINANCIAL CONTRACTS FOR DIFFERENCE ("CFD special conditions") 1. GENERAL RULES These special conditions apply to the conclusion of financial contracts for difference (CFDs) in the account types Forex and CFDs (CFD trading). The possible underlying instruments can be found on the trading platform With the conclusion of a CFD contract, the customer opens a cash-settled long CFD position or short CFD position in relation to the bank on a specified number of units of an underlying instrument (the contract volume). The contract volume is specified on the trading platform. Long and short CFD positions are referred to collectively as CFD positions in the following. Economically, the customer is treated by the bank as though he or she had bought the contract volume at the price set by the bank from the bank (in accordance with the leverage to be found on the trading platform: on credit), or sold it to the bank (short). The floating profits or losses from open CFD positions (hypothetical profits or hypothetical losses) resulting from the applicable prices from the change of the contract value (i.e. the product of the relevant contract rate and contract volume) are calculated continuously by the bank during business and relevant trading hours. The valuation gain or loss resulting from the difference between the contract value at the time of opening and the value at close-out of the CFD position is settled in cash If the underlying instrument for a CFD position is denominated in a currency other than the account currency (underlying instrument currency), the difference between the contract value at the time of opening of the CFD position and the contract value at a later time is calculated by comparing the respective applicable conversion rate of the European Central Bank (ECB) for each business day for conversions of currencies from the underlying instrument currency into the account currency (conversion price) in the contract values converted in the account currency The bank may limit its liability under a CFD position to what it obtains from the hedge for its obligations under such CFD position if it discloses the potential hedging counterparties before the opening of the CFD position and assigns its entitlements under the hedge to the customer for security purposes. Under these conditions, the customer's order for the opening of the CFD position also represents an offer for the conclusion of a contract of assignment. The security assignment of the rights of the bank from the hedge is concluded when the bank discloses to the customer the identity of the effective counterparty to the hedge and assigns its entitlements under hedge to the customer for security purposes at the time of the opening of the CFD position. 2. ACCOUNTS 2.01 Trading account. The customer must transfer the funds intended for CFD trading from the reference account at a deposit bank notified to the bank in the customer information sheet to an account designated by the bank for CFD trading (the trading account) Varengold margin account. The bank maintains a virtual settlement account for the customer, in which all profits and losses associated with CFD positions, the expenses incurred and the margin are posted and settled (the Varengold margin account) Currency, account management. The Varengold margin account is denominated either in EUR or USD (account currency). Other currencies shall be converted into the account currency according to the conversion price and less a handling charge. The margin paid by the customer is stated in the Varengold margin account as credit balance in the account currency. The margin is increased and / or decreased by profit and / or loss realised on individual transactions and automatically becomes the available margin. Unless otherwise agreed in the individual case, the margin does not bear interest. The bank shall in no case be obliged to report any interest collected in the context of the margin Several Varengold margin accounts. Each customer may have several Varengold margin accounts. Each individual Varengold margin account of the customer will be considered separately, i.e. the bank will not determine an aggregated net margin position of all Varengold margin accounts. The provisions of section 3 apply separately to each individual Varengold margin account, i.e. the requirements to the relating margin will not be set off from all individual Varengold margin accounts of the customer. Margin requirements always relate to each individual Varengold margin account of the customer and must be covered by margins available thereon. 16

2 2.05. End of day posting. The equivalent of the margin required for the customer s open positions and the payments due to the bank from the customer in connection with the Varengold margin account are debited to the trading account at the end of the business day. The equivalent of the margin no longer required and the payments due to the customer from the bank in connection with the Varengold margin account are credited to the trading account at the end of the business day. 3. MARGIN Principle. The customer has to provide to the bank a security deposit (margin) for its claims under or in connection with CFD positions by paying exclusively in the permissible account currency and in accordance with clause 3.07 to the trading account. Any currency risks shall be borne by the customer. The equivalent of the margin for the customer s open CFD positions may be used by the bank as a margin for the hedging transactions it has concluded Minimum margin, resetting. The amount of the margin and thus of the available security determines the customer s trading limits. The customer shall ensure that the existing margin does not fall below the required minimum margin at any time. The bank shall be entitled, at any time and at its own reasonable discretion, to newly define the amount of the minimum margin for each customer individually (resetting of minimum margin). The bank will inform the customer through the agreed communication channel about the minimum margin, the new definition of the amount of minimum margin and the date when they take effect. If the new definition of the amount of minimum margin results in a shortfall of the margin, the customer shall immediately balance such shortfall. If no such balancing is made, the bank may perform the liquidation Net margin position. For each of the customer's Varengold margin accounts, the bank continuously calculates the amount resulting from the sum of the margin, the profit realised but not yet converted and posted into the account currency according to the conversion price (not posted profit), the hypothetical profit and other amounts due to the customer from the bank from or in connection with CFD positions, less the sum of losses realised but not yet converted and posted into the account currency according to the conversion price (not posted losses), the hypothetical losses and other amounts due to the bank from the customer from or in connection with CFD positions (net margin position), and informs the customer through the trading platform whether and to what extent his / her net margin position is positive and allows the opening of new CFD positions. (a) Meaning. A positive net margin position describes that portion of the margin that is not required for providing security for individual transactions and a negative net margin position describes the shortage of cover of the required margin. (b) Maintenance of margin. The customer is obliged to ensure that his / her Varengold margin account has a net margin position that is positive with respect to a conversion into the account currency carried out at the conversion price from the opening of the respective CFD position and during the entire term of that CFD position. The obligation to maintain the required margin at any time applies around the clock irrespective of the bank s trading hours. The customer is advised of the fact that for example price movements (unless transactions are subject to limited trading hours) may at any time result in an increased margin requirement even when the stock exchange relevant to an underlying instrument is closed. (c) Calculation. The respective margin must be determined as if (possible or due) mutual claims were charged continuously to the Varengold margin account during the day. The provisions for the margin calculation apply cumulatively, i.e. the requirements as to the respective margin resulting from the different transactions made with the bank are offset. The minimum margin to be paid in all by the customer is the sum of all individual minimum margins to be paid by him / her (total margin) Provision of margin. The first margin has to be paid in before placing the first order. Margins will only be considered to be paid in when the required amount is made available on the trading account. In some circumstances, the execution of the transfer order by the customer will meet the requirement of timely provision of the margin if the customer s main bank (German commercial bank) has confirmed to the bank that the transfer of the margin to the trading account has been effected. This confirmation must be signed by two people and stamped and sent to the bank by fax Liquidation. If the net margin position reaches or falls below the minimum margin, the bank may independently liquidate the customer's CFD positions (liquidation). The bank may continue the liquidation of the customer's open CFD positions until the minimum margin required for the other open CFD positions is reached. In this process, the open CFD positions of the customer are closed out by the amount of hypothetical losses in descending order (i.e. first the CFD position with the highest hypothetical loss etc., whereby all positions for which the reference market is open are first closed) until the minimum margin to ensure the remaining open CFD positions is sufficient. CFD positions are always closed out completely, and partial close-out of open CFD positions does not take place. Liquidation by the bank can lead to close-out of all open CFD positions of the customer. 4. PRICE QUOTATION Statement of prices and specifications. For the tradable underlying assets, the bank will state the prices and other specifications for which it is generally willing to open and close CFD positions on the trading platform during the business hours of the trading platform and the relevant trading hours in each case (contract prices). The statement of contract prices on the trading platform constitutes an invitation by the bank to the customer to open CFD positions through orders. It 17

3 does not constitute an obligation by the bank to accept orders for the opening of CFD positions. The prices and other specifications stated by the bank on the trading platform are included in the orders made by the customer The formation of the contract prices (quotation) is at the reasonable discretion ( 315 BGB) of the bank based on the prices traded on the relevant reference markets specified on the trading platform (exchanges, multilateral trading platforms, systematic internalisers) (reference market) for the underlying assets or on the indices referred to therein (reference prices). The quotation is made by applying premiums or discounts to the respective reference prices. The maximum amount of premiums or discounts can be found at MyVarengold. The bank is entitled to revise the maximum amount of these premiums or discounts at its own reasonable discretion ( 315 BGB) if unusual price movements or fluctuations or liquidity losses have occurred in the reference market, or there is reason to believe that they are imminent. Such a revision may not lead to any subsequent change to the detriment of the customer in the existing relation between the maximum amount of premiums or discounts and the implied volatility of the reference price at the time of the opening of the CFD position. Revisions to premiums and discounts are notified with a posting in MyVarengold and take effect one week after the posting or at a time notified there by the bank at its reasonable discretion ( 315 BGB) Deviations of the exercise price. In the case of orders, deviations of the execution price may occur due to the market situation, i.e. the actual execution price differs from the contract price indicated on the trading platform at the time of the order (slippage) Modification of quotation. The bank is entitled to requote the underlying instrument even after receipt of an order (requotation). Such a requotation may particularly be made if the order is beyond the normal trading volume or require trading outside the trading times for the underlying asset or in illiquid markets, or when changes in the market situation that have occurred in the meantime have to be taken into account. Such a requotation shall always be carried out in consideration of representativeness, fairness and adequacy including the applicable prices and expenses of a transaction of the volume stated in the order in the reference market. The bank will inform the customer of the requotation. The notification shall be considered as a rejection of the original order. The customer shall be free to replace the order based on the requotation or to abstain from placing the order Business hours. The business hours of the trading platform are from Sunday 11 p.m. to Friday 11 p.m. German time. The business hours of the bank are every business day from 8 a.m. (start of business) to 11 p.m. (close of business). Business day means any day on which the Frankfurt Stock Exchange is open for trading (business day). The bank is entitled to change the business hours at its reasonable discretion ( 315 BGB). Changes will be notified via MyVarengold and take effect one month after the posting or at a time notified there by the bank at its reasonable discretion ( 315 BGB) The trading hours for the underlying instrument will be notified on MyVarengold. Changes will be communicated in the same manner and take effect on the business day following the notification or at the time notified When and for as long as trading activities on the relevant reference market are limited because of a public holiday, the bank is not obliged to provide prices for the underlying instruments affected or to execute orders or instructions from the customer For underlying instruments with limited trading hours, the bank is not obliged to quote prices or execute orders or instructions from the customer while the relevant reference market is closed. The underlying assets affected and the relevant trading hours can be found on MyVarengold. Any change will be notified on MyVarengold and takes effect at the end of the following business day Market disturbance. The bank's obligation to quote prices for an underlying instrument and to execute orders or instructions relating to it shall not apply if and for as long as there is a disturbance in the market. Market disturbance means the suspension or limitation of trading in the underlying instrument on the relevant reference market. A limitation on the hours or on the number of days on which trading takes place is not considered a market disturbance if the limitation is based on a previously announced change in the regular trading hours for the underlying instrument affected. A suspension or limitation of trading in options contracts related to the underlying instrument on the options and futures exchange with the highest trading volume of options contracts relating to the underlying instrument is considered equal to the suspension or limitation of trading in the underlying instrument on the relevant reference market. Restrictions on the opening of short positions are considered to be market disturbance Cessation of price quotation. The bank may at its reasonable discretion ( 315 BGB) decide to cease providing future prices for an underlying instrument. This applies in particular to cases in which the underlying instrument experiences a substantial change in valuation due to one of the circumstances referred to in clause , or if this is to be expected at the reasonable discretion ( 315 BGB) of the bank. Any such decision will be notified via MyVarengold and take effect one week after the posting or at a time notified there by the bank at its reasonable discretion ( 315 BGB). It is the responsibility of the customer to close all CFD positions affected by the cessation in a timely manner before the cessation of price quotation. Any CFD positions in the underlying instrument still open when the cessation takes effect will be closed out by the bank at close of business on the business day of the cessation. Orders for the opening of CFD positions that have not been executed expire at the time of the cessation of price quotation. 18

4 5. ORDER PLACEMENT, REJECTION, CANCELLATION, RECORDING OF TELEPHONE CONVERSATIONS Orders from the customer are offers (applications as defined in 145 BGB) to the bank to open a CFD position. The orders allowed (such as market orders, stop orders, trailing stop orders limit orders and orders created by combining these orders types) can be found on the trading platform Order placement. The customer s orders are placed with the bank stating the required data via the order desk or the trading platform. The order desk can only be used to close out open positions, whereas the opening of new positions can only be done on the trading platform. Order placement via the order desk is only possible during the bank s business hours. Outside of business hours of the bank, no technical services and no order desk are available to the customer. The same applies to trading on (exchange market) holidays in a country of the European Union, in Switzerland or the United States of America. The bank s order desk will generally not be available on such days. If the bank and / or the bank s order desk is working on such days, which the bank or the bank s order desk is not obliged to do, the customer may find this out in advance via the bank s order desk Deviations by customer. Deviations from prices and specifications by the customer will not be considered to be an order and shall not be binding upon the bank or the customer. However, the bank can communicate to the customer whether and on which terms and in particular at which price differing from the price stated on the trading platform (collectively special terms) it is willing to open a CFD position for the customer. The customer is free to decide at his / her discretion whether he / she places a corresponding order based on the special terms or refrains from concluding the proposed transaction Expiration of orders. If trading in an underlying asset on the relevant reference market is suspended in full or in part at the request of the stock exchange supervisory authorities, this does not lead to the expiration of orders that have yet to be executed for the underlying instrument affected, but only to suspension of their execution. The same applies if trading in the underlying instrument is suspended or prohibited by act of God, or if the bank is not in a position to provide quotations for the underlying asset for any other reason not under the control of the bank. A order which has not yet been executed does however expire at the time at which the bank declares that it will cease to make quotations for the relevant underlying instrument. If there is no cessation of price quotation for an underlying instrument as a consequence of a special event, an order not yet executed expires at the end of the seventh business day following notice of such cancellation through the posting of a statement to that effect in MyVarengold No commitment. Orders shall not commit the bank before their execution Acceptance. Orders will only be considered to be accepted by the bank after they have been executed by the bank. No separate declaration of acceptance will be made Execution. Orders will be executed only during the business hours of the trading platform and the relevant trading hours in each case Bank s rights to reject. The bank reserves the right to reject and / or not to execute other offers made by the customer that do not constitute orders. Furthermore, the bank reserves the right to reject the acceptance and / or execution of orders for a certain market or contract without giving reasons and / or not to execute the order if (a) The order does not contain all necessary information, is not unique or (b) Margin is not available in the required amount. The customer does not have a right to partial execution of the order, i.e. execution to the amount of the existing net margin position. The rejection is effected by non-execution. No separate declaration will be made Trading limits. The bank may set trading limits for the customer and limit the permissible size of CFD contracts and open CFD positions of the customer. This may mean that no new orders will be possible apart from orders for closing out open positions. The bank will inform the customer on MyVarengold about the trading limits and the dates on which they take effect. The date of effectiveness might be at very short notice. If the CFD positions affected are not closed out and balanced by the customer, the bank may initiate liquidation Telephone recording. The customer agrees that orders placed by him by telephone and other calls made by him to the bank or by the bank to the customer are recorded and stored for evidentiary purposes (e.g. in case of disputes regarding the content of an order) Acquisition of data. If the trading platform is enabled to do so, the customer can generate automated orders from data provided by third parties. The automated conversion of such data into orders is done at the customer's own risk. The bank's co-operation with the data suppliers to provide the technical requirements for this option constitutes in particular no liability of the bank for the quality of the data. 6. CLOSE-OUT Close-out. Open CFD positions are closed completely or partially, i.e. closed-out, by opening an opposing CFD position (offsetting transaction) (close-out). The close-out is initiated either by the customer or by the bank as follows: 19

5 (a) Close-out by customer. The customer offers the bank to effect the close-out with an order concluding a corresponding offsetting transaction on the conditions applicable to this transaction at that point in time. Notwithstanding the provisions of clause 4.01, the bank is obliged to close out open CFD positions unless the conditions of clause (market disturbance) are met. On receipt of an order, the bank may however, at its own reasonable discretion ( 315 BGB), undertake a requotation, taking account of the market environment of the underlying instrument, in particular the market depth and the reference prices traded in the reference markets, as well as the market prices of options on the underlying asset quoted on the most liquid futures exchange in each case. The bank is particularly entitled to do this if an order is placed outside the normal trading volume at low market depth, or if the market environment has changed significantly in the meantime. In this case, the customer is free to decide whether he / she wants to place a new order with the bank at the changed price. (b) Close-out by the bank. Exempt from the restrictions of 181 BGB, the bank may close out or restrict in full or in part an open CFD position under the following conditions: (i) (ii) Reasons for close-out The bank will be entitled to a complete or partial close-out of open positions if: - The bank has the reasonable suspicion that the customer is in possession of insider information as defined by 13 WpHG or is otherwise in breach of applicable rules for protection against market abuse, or - A supervisory authority has addressed a corresponding request to the bank or the customer, or - The customer does not pay a margin, a deposit or another amount due according to the present special conditions, or. - The margin falls below the level of the minimum margin required, or - Insolvency proceedings or similar proceedings with regard to the customer s assets have been requested, the customer has requested such proceedings himself / herself, is insolvent or is in any other position that would justify the opening of such proceedings, or - A market disturbance persists beyond the close of business on the third business day following its appearance and the bank foresees, at its own reasonable discretion ( 315 BGB), a continuation of the market disruption, or - After the announcement of the cessation of price quotation for an underlying instrument, the customer does not close open CFD positions in this underlying instrument, or - The customer does not close a CFD position before expiry of its term, or - In the event of a breach of trading limits or position restrictions, the customer does not close the CFD position affected, or - Bankruptcy proceedings or similar proceedings are opened affecting the issuer of the underlying instrument, or - There are grounds for an extraordinary termination by the bank in accordance with Clause 18 of the General Terms and Conditions, or - The German federal financial supervisory authority BaFin or another competent authority has addressed a corresponding request to the bank or to the customer, or - The ability of the bank to insure its market risk from the CFD position by entering into hedging transactions considered necessary by the bank at its own reasonable discretion ( 315 BGB) is no longer given or is significantly reduced (hedging disruption), provided that the bank has announced the intended independent close-out to the customer with a notice period of at least three business days in advance, or - To hedge against the market risk from the CFD position, the bank has procured the underlying instrument on the basis of a lending agreement with a third party and the lending agreement has been terminated or otherwise ended by the third party, provided that the bank has announced the intended close-out to the customer with a notice period of at least three business days in advance, or - There is another good cause that, at the reasonable discretion of the bank ( 315 BGB), justifies a close-out Reasons for reduction. The bank will be entitled to reduce the amount of the customer s open positions (net or gross) if the bank, at its own reasonable discretion ( 315 BGB), has good reason to assume that: - The present market conditions are abnormal, and / or - Such a measure is required for protecting its rights granted under the present special conditions or its other interests 20

6 (c) Concurrent long and short position. The concurrent taking of a long and short position with regard to the same underlying instrument by the customer does not in itself lead to a close-out of the respective long and short CFD positions. (d) Rights after close-out / liquidation. The bank will not be liable for damages caused as a result of the liquidation or close-out of transactions due to the insolvency of the customer in accordance with 115, 116 Insolvenzordnung [German Insolvency Code] or due to any other reason attributable to the customer Execution of close-out. If the bank exercises its right to close-out or initiates the close-out through the customer, the bank will determine the underlying prices of the two opposite transactions (CFD position on one hand and offsetting transaction on the other) at the moment of close-out in accordance with the contract prices quoted by the bank at this point in time. If no reference prices are available at the time of close-out (in particular if due to a market disturbance), the bank determines the amount of the claim at its own reasonable discretion ( 315 BGB). The close-out shall be carried out by offsetting the price of the CFD position determined by the bank at the moment of the close-out against the price of the offsetting transaction determined at that point in time Indicative close-out price. In case of irregularities or the (partial) cessation of trade, the bank will immediately pass on the indicative close-out price to the customer in case of corresponding inquiries by the customer. The customer will have to communicate immediately whether he / she still desires close-out. If the customer communicates his / her consent immediately, the close-out will take place. Otherwise, the corresponding CFD position will remain in effect until the end of its term at the latest. If regular electronic or telephone trading takes place, the customer will have to inform himself / herself independently on the price as well as on the bid price and the offering price via the trading platform or other media Final close-out price. The bank will inform the customer immediately of the final close-out price and the exact close-out time. However, the bank is not obliged to advise the customer of the last date for close-out before the end of the term Cessation of trading. The customer is aware of the fact that trading of the underlying instrument might be stopped temporarily or completely on account of certain market situations and / or the respective market provisions as well as on account of business disruptions at the bank or one of the bank s counterparties. It might be impossible to execute a corresponding execution transaction or a desired close-out during a temporary suspension of trading. The price for the purpose of calculating the contract value shall be the price valid at the moment of suspension. In case of final cessation of trading, the customer s open positions will be closed Insolvency of the issuer of the underlying instrument. The customer is aware of the risk that the issuer of an underlying instrument may become insolvent. In this case, all open positions concerned will be closed. The bank will inform the customer of the settlement price fixed by the stock exchange. The liability of the bank is excluded Insolvency of a party. In the event of insolvency, all CFD contracts are terminated without prior notice. Insolvency is given if (i) insolvency proceedings with regard to the assets of a party are requested, and the party has either made the request itself, is insolvent or is in any other position that would justify the opening of such proceedings, or (ii) measures are imposed on a party under 46 of the German Banking Act (KWG). 7. REVERSAL OF MISTRADES If, as a result of (a) A technical failure of the trading platform (b) (c) (d) (e) An error in the quotation An operating error Incorrect data provided by third parties, or An official correction of the price of the underlying instrument by the management bodies of the exchange or the relevant reference market a contract price set by the bank deviates considerably from the market price at the time of opening or close-out of the CFD position (the reference price) (mistrade), then the bank is entitled, and obliged at the request of the customer, to reverse the affected opening or close-out of the CFD position. This applies if the competent authorities governing the relevant reference market exercise the mistrade rules applicable to that market. The reversal of the close-out of a CFD position results in it remaining open The bank shall decide in accordance with clause 4.02 whether the deviation of its contract price from the reference price is significant. A deviation of more than 5% is always considered significant. 21

7 7.03. Reversal due to a mistrade or the request for reversal must be notified without delay, no later than one (1) hour after the close of business on the business day on which the opening and close-out of the CFD position took place. In the cases of clause 6.01 paragraph 1 (e) and paragraph 2, the notification period ends one (1) hour after the close of business on the business day on which the price of the underlying instrument was corrected officially or through exercise of the mistrade rules for the relevant reference market. If that day is not a business day, the period ends one (1) hour after the close of business on the next business day. If the mistrade leads to a price deviation of more than EUR 25,000, the reversal may be notified until 11 a.m. on the business day following the business day on which the disputed opening or close-out of the CFD position occurred. The notification is made with a posting on the trading platform or (in the event of a request for reversal by the customer) by telephone In the event of reversal as mistrade, the customer shall be entitled to compensation for reliance damages in accordance with 122 BGB. The claim is excluded if the customer was aware or was negligibly unaware (should have known) that the trade was a mistrade. Any further claims for damages on the part of the customer are excluded, in particular those relating to loss of profit, if and to the extent that the mistrade was not the fault of the bank. Clause 3 of the General Terms and Conditions shall apply A reversal as mistrade can also be made if orders are executed at a price deviating from the reference price because the customer manipulates, modifies or otherwise uses the trading platform in such a way that changes made to the prices set by the bank are not displayed between instruction and execution time. Such a reversal must be made without delay by the bank upon notification of the reason for reversal, no later than the close of business on the tenth (10) business day after placement of the order. 8. NOTICE OF EXECUTION AND OTHER NOTIFICATIONS Notice of execution. The bank will inform the customer immediately of each order executed by it via the trading platform (notice of execution). The execution also results from the account statement. The account statement exclusively constitutes a proof of the actual execution of the order by the bank Ongoing notifications. Moreover, the bank will identify the customer s CFD positions on the trading platform, thereby notifying the customer of the current contract prices for his / her open CFD positions throughout the business day Presentation. The abstracts of account transmitted or made available may state the individual transactions accrued during a settlement period (trading day) collectively Complaints. The customer will have to assert complaints immediately in writing to the bank, in general at the latest at the beginning of the trading day following the notice of execution or any telephone or electronic information received earlier by the customer. The customer alone shall bear the risk that it is no longer possible to cancel the order. Unless a timely complaint as defined by this clause is asserted, the notice of execution shall be considered to be approved. The bank shall particularly point to this consequence in its notice of execution. 9. CHARGES AND TAXES Bank charges. The fees to be paid to the bank in connection with CFD positions in each case (bank charges) result from the list of prices and services. They are payable in each case on the first business day after the opening or close-out of the CFD position. The bank will be entitled to debit the trading account with the bank charges. If the trading account contains no funds or insufficient funds, the bank shall be entitled to initiate liquidation Taxes and other expenditure. The customer shall bear any payable value-added tax and other taxes as well as all other expenditures arising for the bank in connection with the respective transactions, withholding tax as well as any possible future stamp duties and other duties that might be imposed (each of them taxes). The bank will be entitled to debit the trading account with these charges. Moreover, the bank will be entitled, with respect to taxes the deduction or retention of which is prescribed by law, to deduct or retain the corresponding amount in case of payments made to or credit notes in the customer s favour. This shall apply in particular for any arising withholding tax For concluded transactions as well as for financial services provided for him / her by the bank, further expenses and taxes not paid through the bank or charged by the bank may arise for the customer. 10. NOTIFICATION OF OPEN POSITIONS, ACCOUNT BALANCING; REPORTING; FEES Information. The bank will inform the customer daily at close of business of his / her open CFD positions and completed offsetting transactions. The assertion of complaints by the customer must be made immediately in writing to the bank, in general no later than the start of business on the next business day. Unless a timely complaint as defined by this clause is asserted, the notified CFD positions and offsetting transactions shall be considered to be approved Account balancing. The bank will provide the customer with a monthly statement in which the mutual claims arisen during this period of time are stated and offset (account balancing). The customer will have to raise objections for inaccuracy or 22

8 incompleteness of an account balance at the latest within six weeks after its receipt. If the objections are raised in writing, then sending the letter within the time limit of 6 weeks is sufficient for respecting the time limit. Failure to raise timely objections shall be considered as approval. The bank shall particularly point to this consequence in its account balancing. The customer may also request correction of the account balance after expiration of the time limit, but in this case he / she will have to prove that his / her Varengold margin account was charged wrongfully or a credit note he / she is entitled to was not granted wrongfully. 11. Reverse entries and correction entries made by the bank Before issuing an account balancing. Incorrect credit entries to the Varengold margin account may be reversed by the bank through a debit entry prior to the issue of the next account balancing to the extent that the bank has a repayment claim against the customer (reverse entry); in this case, the customer may not object to the debit entry on the grounds that a disposal of an amount equivalent to the credit entry has already been made After issuing an account balancing. If the bank ascertains an incorrect credit entry after a account balancing has been issued and if the bank has a repayment claim against the customer, it shall debit the Varengold margin account of the customer with the amount of its claim (correction entry). 12. REMUNERATION FOR THE BANK CFD overnight financing amount. For every CFD position held by the customer after close of business on a trading day, a positive or negative CFD overnight financing amount is calculated for the customer by applying the MyVarengold CFD overnight rate to a contract value. The CFD overnight financing amount is calculated in the underlying instrument currency and then converted into the account currency. The calculation takes place for every trading day on which the customer holds the CFD position at close of business. If the day following the trading day is not a trading day (e.g. bank holiday) or the days following the trading day are not trading days (e.g. weekend), CFD overnight financing amounts are also calculated for each of these non-trading days In addition to the interest rate of the home country of the underlying instrument (based on the base rate), the MyVarengold CFD Overnight Rate also reflects the costs and risks of hedging with relation to the underlying instrument. For the customer s leveraged long CFD positions there is an increase, and for leveraged CFD short positions a reduction in the respective interest rate. Due to these reductions/increases, for certain interest rates the CFD overnight rate can also be negative for short CFD positions, i.e. the customer is also charged a financing amount for a short CFD position. The bank adjusts the CFD overnight rate according to equitable discretion ( 315 BGB) if the interest rate in the home country of the underlying instrument and/or the costs and risks of hedging in relation to the underlying instrument change significantly. Such a change becomes effective when the setting is made in MyVarengold for all CFD positions held after close of business on the trading day on which the change is made in MyVarengold Payment and burdening of the CFD overnight financing amount. The CFD overnight financing amount is immediately charged (negative CFD overnight financing amount) or credited (positive CFD overnight financing amount) to the Varengold margin account. A credit or debit to/from the trading account only takes place with the end of day posting on the trading day on which the CFD position is closed. 13. PRODUCT SPECIFICATIONS General. For product specifications specific to underlying instruments, please consult MyVarengold Term. The maximum term of a CFD contract is two years, unless otherwise specified. An overview of terms can also be found at the Varengold web site. If the customer does not close the CFD position before expiry of the term, it is closed out. 14. EVENTS IN THE UNDERLYING INSTRUMENT Dividends for long CFD positions. The holders of long CFD positions will receive a balancing payment for the distributed dividends of the underlying instrument. Details are subject to the list of prices and services Dividends for short CFD positions. The holders of short CFD positions will be charged a balancing payment for the distributed dividends of the underlying instrument. Details are subject to the list of prices and services Capital measures and similar events. If the underlying instrument undergoes a significant change in valuation on the basis of a merger, a division, a capital increase, an issue of convertible bonds or warrants, a participation rights issue, a capital reduction, an exchange of stocks, a stock split, a reverse stock split, or any economically comparable measure, then the bank if it does not decide not to issue new prices shall undertake appropriate adjustments to the contract specifications at its own reasonable discretion ( 315 BGB). With regard to open CFD positions, such adjustments may not lead to any change to the detriment of the customer in the existing relation between the contract price at the time of the opening of the CFD position and the weighted average of the market prices of options on the underlying asset quoted on 23

9 the most liquid futures exchange in each case. Adjustments will be posted to MyVarengold and take effect one week after the posting to MyVarengold or at a time notified there by the bank at its reasonable discretion ( 315 BGB) Roll-over. Underlying instruments with a fixed expiration date (e.g. futures) are replaced on the expiration date by the equivalent underlying instrument with a later expiration date. The roll-over losses or returns resulting from the price difference between the expired and the new underlying instrument are debited or credited to the customer's trading account accordingly. 15. Changes Notwithstanding clause 1 (2) of the General Terms and Conditions changes to these special conditions are notified via MyVarengold and become effective two weeks after posting to MyVarengold. 24