GENERAL QUESTIONS

Below, you may find the answers to some of the most frequent questions that we receive from the investors.

The purpose of the “Investment Guarantee Fund” with the distinctive title “Guarantee Fund” is to compensate clients / investors of Investment Services Firms (“ΑΕΠΕΥ”).  It operates under the provisions of L. 2533/1997, as in force, reflecting the harmonization of the Greek laws with the provisions in Directive 97/9/EC of the European Parliament and of the Council of 3 March 1997 on investor-compensation schemes.

The purpose of the “Investment Guarantee Fund” with the distinctive title “Guarantee Fund” is to compensate clients / investors of Investment Services Firms (“ΑΕΠΕΥ”).  It operates under the provisions of L. 2533/1997, as in force, reflecting the harmonization of the Greek laws with the provisions in Directive 97/9/EC of the European Parliament and of the Council of 3 March 1997 on investor-compensation schemes.

The Guarantee Fund is a legal person under private law, operating as a Guarantor and, in respect of any operational matter, is governed by the provisions in Law 2533/1997, as in force.

The seat of the Guarantee Fund is in Athens.

The Guarantee Fund website, www.syneggiitiko.gr, lists all necessary information for investors, in particular information about the process and the conditions of compensation.

The Capital of the Guarantee Fund shall be made up by members’ contributions.

Capital contributions can be initial, ordinary, additional and extraordinary. The contributions paid by a member is such member’s total share.

The total Capital by December 31st, 2016 amounted to 51,026,483.00 euro.

Participation of the Investment Services Firms (members and non-members of the Athens Stock Exchange) in the Guarantee Fund is mandatory and required in each case of provision of covered investment services. Exceptions to this mandatory participation are the Investment Services Firms authorized in another EU Member State or a third country provided they are covered by a transaction guarantee scheme in their country of origin which provides their clients with a coverage equivalent or higher than that of the Guarantee Fund.

Resources of the Guarantee Fund consist of ordinary and extraordinary contributions of participating Investment Services Firms, donations, income from liquidation of claims of the Guarantee Fund and from the management of its assets.

The principal covered investment services are as follows:

  •  (a)       reception and transmission of orders, namely, reception and transmission of orders on behalf of the clients for transactions in financial instruments;
  • (b)       execution of orders on behalf of clients, namely, concluding agreements to buy or sell one or more financial instruments on behalf of clients;
  • (c)        dealing on own account, namely, dealing on Investment Services Undertaking’s own equity in one or more financial instruments for transactions in such instruments;
  • (d)       portfolio management namely, management of client portfolios at the Investment Services Firm’s discretion, following client orders in one or more financial instruments;
  • (f)        underwriting of financial instruments or placing of financial instruments on a commitment basis;
  • (g)       placing of financial instrument without a firm commitment basis.

The ancillary service covered is safekeeping and administration of financial instruments on behalf of clients, including custodianship and related services, such as cash/collateral management;

 

Any other type of investment not falling within the above covered investment services and is provided by the members of the Guarantee Fund to their clients SHALL NOT BE COVERED BY THE GUARANTEE FUND.

Those financial instruments are as follows:

 

  • (a)        Transferable securities;
  • (b)       Money market instruments;
  • (c)        Units of collective investment undertakings;
  • (d)       Options, futures, swaps, forward rate agreements and any other derivative contracts relating to securities, currencies, interest rates or yields, or other derivatives instruments, financial indices or financial measures which may be settled physically or in cash;
  • (e)        Options, futures, swaps, forward rate agreements and any other derivative contracts relating to commodities that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event);
  • (f)        Options, futures, swaps, and any other derivative contract relating to commodities that can be physically settled provided that they are traded on a regulated market and/or an MTF.
  • (g)       Options, futures, swaps, forwards and any other derivative contracts relating to commodities, that can be physically settled not otherwise mentioned in case f’ in this Article and not being for commercial purposes, which have the characteristics of other derivative financial instruments, having regard to whether, inter alia, they are cleared and settled through recognised clearing houses or are subject to regular margin calls;
  • (h)       Derivative instruments for the transfer of credit risk;
  • (i)        Financial contracts for differences;
  • (j)        Options, futures, swaps, forward rate agreements and any other derivative contracts relating to climatic variables, freight rates, emission allowances or inflation rates or other official economic statistics that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event), as well as any other derivative contracts relating to assets, rights, obligations, indices and measures not otherwise mentioned in this Article, which have the characteristics of other derivative financial instruments, having regard to whether, among other, they are traded on a regulated market or an MTF, are cleared and settled through recognized clearing houses or are subject to regular margin calls.
  • The Guarantee Fund shall cover investor claims arising out of transactions within or outside regulated markets relating to the covered principal and ancillary services provided by an Investment Services Firm under the authorization granted thereto by the Hellenic Capital Market Commission for financial instruments, as a result of the Firm’s failure confirmed by decision of the Hellenic Capital Market Commission and subsequent special clearing obligation process upon a court decision on bankruptcy a) to give back the capital payable to those investors or the capital owned by them and which are held by the Firm on their behalf, or b) to return financial instruments owned by them and which are held or managed on their behalf.
  • The Guarantee Fund shall cover client compensation arising out of investment services for financial instruments within the framework of cross-border Investment Services Firm activity by means of passport or establishment of a branch.

The amount of compensation per client / investor for the total of claims against an Investment Services Firm arising out of covered investment services provided shall be up to 30,000.00 euro.

The highest amount of compensation for the total of covered investment services shall be 30,000.00 euro as such has been established by decision of the Minister of Finance (Ministerial Decision – MD) (Ministry of Finance- ΥΠΕΘΟ) 14082/Β.809/2000 (Β467).

The Guarantee Fund shall compensate clients / investors of an Investment Services Firm when such clients / investors are not fully satisfied due to failure confirmed by decision of the Hellenic Capital Market Commission and the firm becomes subject to special clearing obligation either by a court decision on bankruptcy in order a) to give back the capital payable to them or owned by them and which are held by the Firm on their behalf, or b) to return financial instruments owned by them and which are held or managed on their behalf.

The Guarantee Fund may deny payment of compensation to clients / investors in the below situations:

  • part of claim for compensation is considered to be false;
  • clients / investors have utilized fraudulent means in order to receive compensation by the Guarantee Fund;
  • clients / investors act as an intermediary in respect of the covered service giving ground to claim thereof, and nothing in the available information provides evidence of the end-beneficiary’s entitlement to compensation as a client or of the compensation received by the end-beneficiary on different grounds;
  • a substantial part of loss stemming from intent or gross negligence thereof;
  • a late claim for compensation;
  • money laundering.

The Guarantee Fund notifies any and all relevant decisions to the interested parties immediately after issuance thereof and must pay the amounts of compensation, as those shall be determined by the Compensations committee, to the compensation beneficiaries.

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