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Introducing Broker Agreement
"I need an Introducing Broker Agreement for our Hong Kong-based securities firm to engage independent financial advisors who will refer high-net-worth clients to us, with a tiered commission structure based on AUM and compliance with SFC Professional Investor rules."
1. Parties: Identification of the introducing broker and the principal broker, including their regulatory status and contact details
2. Background: Context of the agreement, including the intended business relationship and relevant regulatory framework
3. Definitions: Key terms used throughout the agreement, including regulatory terminology and business-specific definitions
4. Appointment and Scope: Terms of appointment of the introducing broker and detailed scope of permitted activities
5. Regulatory Compliance: Obligations regarding SFC regulations, licensing requirements, and compliance with applicable laws
6. Introducing Broker's Obligations: Specific duties including client introduction procedures, due diligence requirements, and service standards
7. Principal Broker's Obligations: Responsibilities regarding client acceptance, service provision, and support to the introducing broker
8. Commission and Payment Terms: Structure of commission payments, calculation methods, and payment procedures
9. Representations and Warranties: Standard and specific warranties regarding licensing, compliance, and capacity
10. Confidentiality: Protection of confidential information and client data, compliance with privacy laws
11. Term and Termination: Duration of the agreement and circumstances for termination
12. Indemnification: Mutual indemnification provisions and liability allocation
13. General Provisions: Standard clauses including governing law, notices, and amendment procedures
1. Non-Competition: Restrictions on competitive activities, used when exclusivity is required
2. Marketing and Branding: Guidelines for using each party's branding and marketing materials, relevant when joint marketing is contemplated
3. Training and Support: Details of training provided by principal broker, included when significant support is required
4. Insurance Requirements: Specific insurance obligations, included for high-risk activities or regulatory requirements
5. Dispute Resolution: Detailed dispute resolution procedures, included when specific arbitration or mediation processes are preferred
6. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in volatile markets
7. Data Protection: Detailed data protection provisions, needed when extensive personal data processing is involved
1. Schedule 1: Commission Structure: Detailed breakdown of commission rates, tiers, and calculation methods
2. Schedule 2: Compliance Requirements: Specific regulatory requirements, reporting obligations, and compliance procedures
3. Schedule 3: Client Introduction Procedures: Step-by-step procedures for client introductions and documentation requirements
4. Schedule 4: Approved Products and Services: List of products and services the introducing broker is authorized to promote
5. Schedule 5: Due Diligence Requirements: Detailed KYC and due diligence procedures for client onboarding
6. Appendix A: Required Forms and Documents: Templates of forms and documents required for client introductions
7. Appendix B: Contact Details and Escalation Matrix: Key contact information and escalation procedures for both parties
Authors
Financial Services
Investment Banking
Securities Trading
Asset Management
Wealth Management
Insurance
Corporate Finance
Private Banking
Fintech
Professional Services
Legal
Compliance
Business Development
Client Services
Operations
Risk Management
Executive Management
Partnership Management
Customer Relations
Document Management
Compliance Officer
Legal Counsel
Head of Business Development
Relationship Manager
Chief Operating Officer
Head of Compliance
General Counsel
Business Development Director
Head of Client Services
Risk Manager
Chief Executive Officer
Head of Operations
Compliance Manager
Legal Director
Partnership Manager
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