Titanedge Securities Ltd
Regulated by the Cyprus Securities and Exchange Commission
Licence Number: 405/21
|1st Version||Compliance Department||24.10.2022|
Table of Contents
- Purpose 3
- Types of Affiliates and Services 4
- Affiliates On-Boarding and Due Diligence Procedures 5
4.1. Responsible Persons 5
4.2. Due Diligence Documentation and Measures 6
- Marketing Material used by the Affiliates 8
5.1. Requirements for Affiliates operate in EEA Countries 8
- Monitoring 10
6.1. Frequency of Affiliates’ activities monitoring 10
6.2. Monitoring Procedures 11
- Termination of Relationship with Affiliates 13
- Remuneration Schemes 13
- Reporting to the Management Body 14
- Record Keeping Requirements 14
- Updates 15
Annex 1 – EX-ANTE REVIEW OF THE AFFILIATE 16
Annex 2 – MONITORING FORM OF THE AFFILIATE 17
Titanedge Securities Ltd is an Investment Firm that owns and operates the brand “TradeEU” (www.tradeeu.com). The Company is incorporated and registered under the laws of the Republic of Cyprus, with registration number HE 411909 and is authorized and regulated by the Cyprus Securities and Exchange Commission (“CySEC”), with CIF license number 405/21. The Company’s registered office is located at Panayides Building, 1st floor, Office no 11, 1 Chrysanthou Mylona Street, Ayia Zoni, 3030 Limassol, Cyprus.
The Company under its obligations as a CIF is required to maintain and operate effective organizational and administrative arrangements in order to take reasonable and sufficient steps in preventing and/or mitigating possible conflicts of interest from adversely affecting its clients’ interests.
The Company has an Affiliate Program which allows the third parties (the “Affiliates”) to attract and introduce clients for the purpose of concluding a contract with the Company, among others, through the following:
- online promotion of the Company’s brand;
- use of third parties’ websites as a portal for displaying promotional and advertising content;
- host of marketing material and direct web-traffic to the Company’s website; and
- increase of the Company’s online profile through search engine optimisation.
It is provided that the Company will receive services from Affiliates who fulfil the requirements to become an Affiliate of the Company as set out by the Company and/or any applicable laws and regulations. Moreover, the Company, as part of its Marketing Policy, enters into commercial relationships with Directories within the scope of promoting its services and products.
The purpose of this Affiliates Policy (the “Policy”) is to set out the conditions and procedures followed by the Company for establishing a relationship with the Affiliates or enter into a commercial relationship with Directories, the duties and responsibilities of the Affiliates and Directories, including the Company’s employees as well as the employees of service providers who assist the Company with its affiliation arrangements (the “third party marketing services providers”). In addition, the Policy sets out, the marketing guidelines which are required to be followed by the Affiliates and Directories, the monitoring procedures adopted by the Company’s Compliance Function in order to effectively monitor the relationship with an Affiliate and consequently whether such persons comply with the legislative requirements. This Policy further addresses the remuneration of Affiliates and Directories, the terms of the Affiliates Agreements as well as the Company’s record keeping procedures in relation to such arrangements.
3. Types of Affiliates and Services
For the purposes of this Policy, the term Affiliate shall have the following meaning, as per the provision of Circular C217 of CySEC, with regards to the use of Affiliates:
The term ‘Affiliate’ includes any person, either natural or legal person, with whom the Company establishes a business relationship, across multiple jurisdictions to promote its brand, and use their website as a portal for displaying promotional and advertising content host marketing material and direct web-traffic to the Company’s website, increase the online profile of the Company through search engine optimization and perform any other similar (with the abovementioned) activity.
In light of the above, the Company considers the following two (2) types of ‘Affiliates’:
3.1 Per se Affiliates (the “Affiliates”)
This term includes persons, either natural or legal persons, who have requested to become Affiliates of the Company and have passed the onboarding procedure. In particular, advertise and promote the Company’s products and services through their own website within the scope of directing leads to the approved domains operated by the Company.
3.2 Advertisers/ Directories (the “Directories”)
Further to the Affiliation arrangements, the Company, as its own discretion, decides to enter into commercial relationships with persons through which the Company will market its services and products, after careful consideration on certain elements as outlined below. It is noted that Directories have their own financial related websites or blogs through which they promote services and products of various firms, including the Company’s products through paid advertisements, landing pages, blogs and social media.
The Affiliates and Directories shall not use any services other than those mentioned above. In particular, they are prohibited to perform any of the services below:
- Maintenance and operation of a Call Centre;
- Communicate with potential clients or clients following their introduction;
- Receive Clients’ Funds;
- Provide investment services (i.e. trade on behalf of the clients and/or investment advice); and
- Produce and publish material which has not been approved by the Company.
4. Affiliates On-Boarding and Due Diligence Procedures
The Company defines the criteria for accepting both Affiliates and Directories.
4.1 Responsible Persons
The Company has appointed dedicated teams which shall be responsible for the onboarding of the Affiliates and selection of Directories, including the monitoring of activities carried out by the respective persons. The responsible person for the onboarding procedure of the Affiliates and Directories is the Compliance Department.
An Affiliate can request, at its own initiate, to become an Affiliate of the Company through the completion of the form available in the dedicated section of the Company’s website. The below steps shall be followed, for both legal or natural, persons who wish to become Company’s Affiliates:
- The Affiliate’s request is received through the system and the responsible person contacts the potential affiliate in order to request certain information and documentation. The due diligence documentation requested are specified in Section 4.2 of the Policy.
- The responsible team reviews the due diligence documentation, and if anything further is required this is requested by the potential Affiliates, until there are no further comments.
The Affiliate must fit certain criteria. In this respect, the following checks need to be performed prior the final approval of the Affiliate and the Checklist of Annex 1 must be completed accordingly:
- Verification of the identity of the Affiliate, including performance of World Check and Sanctions Checks
- Cross check of the locations of targeted clients with the jurisdictions of the Company which is allowed to offer its services
- Marketing methods to be used by the Affiliate (i.e. websites, landing pages, social media)
- Perform an overview of the website to be used by the said person to check if something seems suspicious
- If no further information is required the Affiliate is being approved. If the person does not qualify as an Affiliate, then it will be rejected for any of the following reasons:
Reasons for rejection during the registration procedure:
- Failure to provide mandatory due diligence documents
- Disagreement on the remuneration scheme
- Requested services not in line with the Affiliate Services
- The member of the Compliance Function, upon approval of the Affiliate, will proceed with the update of the CIF electronic record available in the CySEC Portal as well as the internal registry of Affiliates.
- The responsible member of the Compliance Function shall also communicate with the relevant departments in respect to such an approval, e.g. Finance and Accounting Department that handles the payments.
- The introduced clients will be informed as follows:
- That they have become clients of the Company through the welcome email received during their onboarding procedure
- That the Affiliate is not associated with the Company and clients should not contact them directly
- That Affiliates are not authorised to provide any investment services, i.e. trade on their behalf of investment advice, therefore their login details to the trading area shall not be shared with them
Regarding Directories, and prior entering into such commercial relationships, the Company shall consider the marketing strategies of such persons, i.e. marketing shall not be directed to prohibited audiences such as persons who are under the legal age, residents of countries which the Company is not allowed to offer its services, clients who fall outside the positive target market of the Company. In addition, Directories’ activities shall be aligned with the financial industry, i.e. the Company cannot select to market its services through a directory which operates in the pharmaceutical industry.
4.2 Due Diligence Documentation and Measures
The Company’s due diligence procedure applicable when entering a relationship with an Affiliate includes the undertaking of the measures specified below.
(A) Legal Entity
The following documentation must always be collected for Affiliates, on a risk-based approach and based on the principle of proportionality:
(B) Natural Person
- Valid copy of the passport or national ID: Copy should be clear and should have all the information clearly indicated.
- Utility bill up to six (6) months: Copy should be in colour, clear with the full name and complete home address. Utility bills such as electric and water are valid.
In case where two or more persons wish to operate together for the promotion of the Company’s services, the due diligence needs to be completed for all persons and the agreement with the said persons needs to cover the following:
- Whether either or all members need to approve actions in their account
- How payments will be performed including segregation of the payment to each of them or collective payments
- All members shall be severally and collectively liable to comply with the obligations under the agreement signed.
The Company, when entering into a relationship with a Directory shall proceed with the collection of the documents specified in the aforesaid table. However, given the nature of such relationship, the Company may proceed with the collection of less documentation. More precisely, for natural persons, who act as Directories, the Company shall always collect a valid coloured copy of the passport or national ID. In addition, for legal persons who act as Directories, the Company shall also proceed with the collection of (a) Certificate of Incorporation and (b) Certificate of Directors.
The responsible team shall also proceed with the performance of the World Check checks and Sanction Screening for Affiliates and Directories who are natural persons. In respect to legal persons the Company shall perform World Check and Sanctions Screening on the entity, its directors and authorised persons, if different from the directors.
The Company shall consider additional factors as well before entering into a relationship with a Directory, such as the below:
- Whether its activities are relevant to financial related websites, blogs, newspapers and/or advertising media;
- Their websites must be related to the investment services and/or activities offered and/or recommended by the Company and/or otherwise financial and/or economic related and any Marketing Materials regarding the investment services, activities and/or financial instruments offered and/or recommended by the Company, displayed on such websites, must only be addressed to Clients who fall under the appropriate target market determined by the Company for each financial instrument it offers;
- Where relevant, the Company shall provide them with information regarding the appropriate distribution channels and the identification of the relevant target market of each financial instrument intended to be distributed.
In addition to the above, the Directories are responsible for providing to the Company at all times true and complete information including but not limited to the following:
- Fully signed insertion order which includes information regarding payment instructions, the location and nature of the activities and remuneration scheme;
- any other information which the Company may request from time to time.
All documents need to be either in English or Greek Language. Otherwise, the Company shall ensure that it maintains a translation of the respective documentation. Such translation shall bear the name, position and signature of the person who proceeded with the translation.
5. Marketing Material used by the Affiliates
The marketing material used from the Affiliates and Directories should be sent by the Company and it should be always approved by the Company’s Compliance Function. The marketing material is always available in the relevant system/portal maintained by the Company.
5.1 Requirements for Affiliates operate in EEA Countries
With regards to Germany, the Federal Financial Supervisory Authority (the “BaFin”) published Guidelines on the General Administrative Act (the “Act”) regarding the Contracts for Difference (the “CFDs”). The requirements set in the said Guidelines and applicable to the Affiliation arrangements are outlined below:
(A) Requirement for risk warnings
It is required by the Act to include a risk warning for all direct and indirect communications by CFD providers relating to the marketing, distribution and sale of CFDs. This requirement includes the following in particular:
- Smartphone applications (“apps”) and the descriptions of these apps in the app store;
- Advertising videos, including those on video portals such as ‘Youtube’;
- Podcasts (audio) and the description of these podcasts;
- Social media messages such as those on Twitter, Facebook, Instagram, etc.
(B) Layout of Risk Warnings
It is mandatory for risk warnings to include a loss percentage and their layout must conform to the requirements set out from sections A to G of the Annex to the Act. Some of the relevant requirements are set out below, for your ease of reference:
- Although reduced character warnings may be used, as set out in Section D of the Annex to the Act, in cases where third-party marketing providers impose character limits, the reduced character risk warnings should not be used for images and graphics embedded in messages. If such a message consists only of an image, the latter must contain the risk warning in accordance with Section B of the Annex.
- For videos and similar media, the risk warning must be permanently displayed/shown both in the description of the video or similar medium and when it is played.
- Risk warnings should refer solely to the Act; however a cross reference is not mandatory.
(C) Prominence of Risk Warnings on webpages
Under no.1 of the risk warning conditions, the risk warning for retail investors must always be presented in such a way that is prominently displayed and recognisable to retail clients. In particular, the risk warning must be prominently displayed in cases of web-based marketing. It must be also displayed separately to other published information and must be highlighted.
Providers could ensure this through the following examples:
- A risk warning taking the form of permanent disclaimers at the bottom of the screen;
- Highlighting the risk warning using bright colours or specific fonts.
The visibility and recognisability of warnings for retail investors is restricted in, inter alia, the following cases:
- Pop-up messages that obscure the risk warning when the web page is visited (e.g. data protection information);
- The possibility for investors to remove the risk warning in its entirety (e.g. by clicking it off / closing it);
- The display of risk warnings in muted colours or distracting attention from them with other webpage content;
- Risk warnings embedded in narrative text without highlighting them or separating them visually.
(D) Affiliate, Partner Marketing & Introducing Brokers
CFD providers must ensure that they are compliant with the mandatory risk warnings where third parties perform advertising and marketing measures for them. This applies to affiliates or partner programs and to introducing brokers.
It is the responsibility of the Company to ensure that the advertising partners or advertisers commissioned by them comply with the relevant requirements to include a risk warning with a provider-specific loss percentage.
Pursuant to Article 292 of the Securities Code issued by the competent authority of Portugal (“CMVM“) regarding advertising and prospecting, the Company shall not enter into business relationship with any third parties in Portugal used for advertising their services, unless the third party is a financial intermediary or tied agent, as per the definitions outlined in the said act.
The relevant articles of the Securities Code are presented below:
Article 292 – Advertising and Prospecting
Advertising and prospecting aimed at agreeing financial intermediation contracts or collecting information on current or potential clients may only be carried out by:
- a) A financial intermediary authorised to carry out the activities in question;
- b) A tied agent, pursuant to Articles 294-A to 294-D.
Article 293 – Financial Intermediaries
Financial instrument intermediaries consist of:
- a) Credit institutions and investment firms authorised to exercise financial intermediation activities in Portugal;
- b) Entities with functions corresponding to those described in subparagraph (a) authorised to exercise any financial intermediation activity in Portugal.
The monitoring of the Affiliates and Directories is part of the overall monitoring conducted by the Compliance Function, in order to ensure that compliance risk is comprehensively managed and monitored.
6.1 Frequency of Affiliates’ activities monitoring
The frequency of the monitoring of the Affiliates’ websites is adjusted taking into account the number of introduced clients, i.e. clients who have completed the registration procedure and their account has been approved. In particular, the frequency is adjusted as follows:
6.2 Monitoring Procedures
The monitoring of Affiliates and Directories includes carrying out the below procedures:
- Affiliates / Directories Services
The Company shall ensure that Affiliates and Directories do not offer any services other than those listed in section “Affiliates Services” of this Policy.
- Website Reviews of Affiliates / Blog Reviews of Directories
The Company ensures that the content of the Affiliates’ Websites as well as the content of the Directories’ blogs or financial related websites, given during the registration procedure is always in line with the Guidelines issued from CySEC regarding the information addressed to clients and the principles set in the Company’s Marketing Policy. In particular, the following checks are performed:
- Whether the Affiliate used any marketing material that has not been pre-approved by the Company. The approved marketing material of the Company is included in the designated system of the Company.
- Whether the marketing material makes emphasis on profits.
- Whether the marketing material contains any absolute statements such as simple, easy etc.
- Where the material referring to past performance in regards to a financial instrument or an investment service, the indication is not to be the most prominent feature in the material, it contains a prominent warning that “Past performance is not a reliable indicator of future results” and the reference period and the source of information is clearly stated.
- Whether the Risk Warnings are properly placed, and the correct wording and font are placed/used.
- Whether the services and products promoted are consistent with the Company’s license.
- Whether the Affiliate / Directory promotes a campaign that has expired.
- Whether the Affiliates’ websites / Directories’ blogs or financial related websites include logos of Regulators and/or brand/trading name of the Company.
In the event of any deviations or use of marketing material which has not been pre-approved by the Compliance Function, the Affiliate will be given up to three (3) days to implement the requested amendments unless otherwise agreed with the Company, depending on the severity of the breach. The feedback provided by the Company should include clear instructions on the parts that need to be amended and specific guidance on each requested adjustment, if necessary.
Following the lapse of the deadline specified above, the Company shall check whether the Affiliate has implemented the necessary amendments on the relevant website. In case the Compliance Function of the Company identifies identical wrongdoings, then the Company reserves the right to either issue a warning on the Affiliate or depending on the seriousness of the wrongdoing to terminate the agreement after giving the appropriate notice to the Affiliate.
In addition to the above, the member of the Compliance Function shall perform random checks in the internet to gather all the Affiliates’ digital media data that relates to the Company and ensures that these are in line at all times with the provisions of this Policy as well as whether indeed such Affiliate has been approved by the Company. Such check shall be performed using different IPs in order to assess the information published in each jurisdiction,
- Clients Introduced by Affiliates
The Company also monitors the IP logins of a random sample of introduced clients in order to check whether it is likely for the Affiliate to have access to the trading account of the said clients. In case where the IP address of placing orders is not consistent with the introduced clients’ IP login, i.e. the IP of placing an order matches the IP used by the Affiliate in the registration procedure, the Company communicates with the Account Manager of the said client in order for the latter to ensure that the client is aware of the open positions and indeed it was the client who opened them.
The member of the Compliance Function, following completion of the review performed, completes the relevant checklist available in the Annex 2 of this policy and keeps the relevant evidence in the Company’s server and/or system. In case of identification of important deficiencies, the Affiliate is informed accordingly and it is required to take immediate actions.
The Affiliate shall be provided with a reasonable deadline to rectify such deficiencies. In case of serious weaknesses, the relationship with Affiliate is terminated immediately as per the procedures outlined in the following section. The findings from the above reviews shall be reported to the Compliance Officer of the Company, who following review of the findings shall decide on the disciplinary actions to be imposed:
- Upon first misconduct/deficiency, the Affiliate shall receive a warning in relation to the breach and shall be requested to take immediate actions. The Affiliate shall be also provided with the list of guidelines of marketing communication of the Company and return to the Company an acknowledgement letter.
- Upon a second misconduct / deficiency, or in case of first misconduct which the Compliance Officer, decides to be of greater risk to the Company (i.e. trading on behalf of clients or unauthorized investment advice), shall request the termination of the Affiliate.
- Withholding of payments.
The warnings are sent to Affiliates through email.
- Due Diligence Documents
The Company one (1) year from the commencement of the business relationship checks whether the KYC documentation of Affiliates and Directories (if collected) remain valid and updated. In case any of the said documents is outdated or material changes have been made, the new documents are requested and the records of the Company are updated accordingly.
7. Termination of Relationship with Affiliates
The Senior Management is responsible to decide whether a relationship with an Affiliate will be terminated. The Compliance Officer shall give the appropriate notice which shall be reviewed and approved by the Senior Management of the Company. The notice shall also be accompanied with the relevant reasons of termination.
The reasons for termination of the relationship are listed below:
- Subsequent breach of the terms of the Affiliates Agreement in respect to the marketing material disseminated.
- Failure to take actions to address deficiencies in respect to marketing material and information addressed to clients.
- There is no introduction of clients for a significant time period, i.e. six (6) months.
The decision to terminate a relationship with an Affiliate is sent to them through the registered email. The Compliance Officer informs:
- the Compliance Function who shall proceed with the update of the CIF electronic record accordingly. In addition, the responsible person ensures that the internal registry of Affiliates is updated accordingly. Also, one (1) week following the termination of the relationship the Affiliate checks whether the marketing material of the Company has been removed from its website.
- The Head of Finance and Accounting Department, who shall proceed with the settlement of any outstanding payments to the terminated Affiliate, following the removal of any reference of the marketing material of the Company from the Affiliate’s website.
- The Head of Customer Support shall inform the clients who were introduced by the terminated Affiliate regarding the matter through email.
8. Remuneration Schemes
Affiliates are rewarded for new clients who have initially landed on the approved domains of the Company via the banners and/or link(s) provided to the Affiliates.
The Remuneration Scheme due to the Affiliates or Directories is outlined in the Insertion Order or invoice issued. Once the payment is due, the Head of Finance and Accounting Department checks the remuneration and payments to be made (i.e. number of introduced clients, any deductions due to breaches) and proceed with the settlement of the relevant invoices.
It is noted that the Directories receive a flat fixed fee for the advertising services requested by the Company (e.g. articles, reviews etc.). Payments to Affiliates are made based on the introduction of the said clients to the Company’s websites, via the Affiliates’ individual Tracker ID’s. Affiliates only receive accruals for potential clients who link through using the Affiliate’s Tracker ID or use any other tracking code which has been previously approved by the Company.
In addition, the Affiliate shall be paid with Cost Per Acquisition scheme (the “CPA”). The remuneration of the Affiliate will be granted only for qualified Clients according to all the following terms that have to be met in their entirety:
- A client who was introduced to the Company by the Affiliate and identified by a tracker ID assigned to such Intermediary by the Company;
- The Company confirms that such Affiliate shall be included in the relevant scheme and linked to the Site(s) in accordance with the Agreement;
- Such client has been approved by the Company, made a deposit and fulfilled the minimum trading requirements;
- Such client is not already registered and approved by the Company under a different name or with a different identity or from same IP address;
- Such client falls within the identified target market of the Company;
- The Affiliate has provided all documents and proof of payment according to the Company’s procedures; and
- The Affiliate complies with the Law and any directives, circulars issued pursuant to the Law.
All Affiliate accruals generated are paid into the Affiliates’ Accounts within fifteen (15) days of the close of each calendar month or otherwise specified in the Affiliate Agreement.
9. Reporting to the Management Body
The Compliance Officer shall report to the management at least on an annual basis the results of the monitoring performed in respect to the use of Affiliates, including actions to be taken in the event of weaknesses identified in respect to the controls in place. The Management Body shall decide whether to approve and reject such actions and recommend alternative solutions where necessary.
10. Record Keeping Requirements
The Company needs to maintain the following records in respect to the use of Affiliates:
- List of Approved Affiliates
- List of Terminated Affiliates, including the reason of termination
- Monitoring Checklists
- Deficiencies identified and rectifying actions taken (if any)
- Notifications for rectification sent to Affiliates
- Agreements with Affiliates
- Termination Letters sent to Affiliates
The Compliance Officer is responsible to review and update at least annually the Use of Affiliates Policy whenever there is a change in the legislation issued by CySEC or any other European Body or when the controls and procedures need to be further enhanced. The revised policy shall be approved by the Board of Directors and relevant meeting minutes shall be kept in Company’s records.
The revised version of the policy needs to be also distributed to the responsible persons and relevant acknowledgements of understanding and acceptance shall be kept in the employees’ file kept by the HR department.
Annex 1 – EX-ANTE REVIEW OF THE AFFILIATE
Completed by: [please indicate]
|URL – website(s):|
|All KYC documents have been collected and verified||☐|
|Targeted clients’ jurisdiction is consistent with the Company’s cross border||☐|
|Marketing material methods are within the scope of Affiliate arrangements||☐|
|Website operated by Affiliate has been reviewed||☐|
|Other Comments (if applicable):|
|Date of approval:|
Annex 2 – MONITORING FORM OF THE AFFILIATE
Completed by: [please indicate]
Website’s monitoring details:
|Date of initial approval:|
|Marketing Material is approved by the Company and it is in line with the Marketing Policy of the Company||☐|
|Risk Warnings are in place and the wording used is in accordance with the CySEC requirements||☐|
|The services and products promoted are consistent with the Company’s license||☐|
|The Affiliate does not promote a campaign that has expired||☐|
|Affiliates do not offer any unauthorised services||☐|
|IP logins are consistent with clients’ IP login||☐|
|Due Diligence Documents|
|KYC documentation of Affiliates remain valid and updated||☐|
Approved by the Compliance Officer