Client Information Sheet of ARROWA AG

(Client information according to art. 8 para. 1 of the Swiss Financial Services Act “FinSA”)

1.Purpose of the client information sheet

With this information leaflet, we would like to inform you about ARROWA AG, our financial services and the associated risks and how we deal with conflicts of interests.

This client information sheet fulfils our obligations under the new Financial Services Act and is intended to provide you with an overview of our financial services. Information regarding the costs and fees of the financial services offered can be found in the annex to the portfolio management agreement. For information on the risks generally associated with financial instruments, please refer to the enclosed brochure “Risks in Trading with Financial Instruments” published by the Swiss Bankers Association (SBA_Risks_Involved_in_Trading_Financial_Instruments_2023_EN.pdf (swissbanking.ch)).

Furthermore, we would like to inform you with regard to the dormant assets.

Sometimes contacts with customers are broken off and the assets subsequently become dormant. Such assets can be permanently forgotten by customers and their heirs. The following is recommended to avoid loss of contact or dormancy:

  • Changes of address and name: Please notify us immediately if you change your place of residence, address or name.
  • Special instructions: Please inform us of any longer absences and of any redirection of correspondence to a third party address or withholding of correspondence, as well as of how to be contacted in urgent cases during this time.
  • Granting of powers of attorney: It may be advisable to designate an authorised person whom ARROWA can contact in the event that contact is broken off.
  • Orientation of trusted persons and testamentary disposition: Another way to avoid a lack of contact and information is to inform a trusted person about the relationship with ARROWA. However, the asset manager may only provide information to such a person of trust if they have been authorised to do so in writing. Furthermore, the assets concerned can be mentioned in a testamentary disposition, for example.

Further information can also be found in the brochure “Dormant Assets” published by Swiss Bank Association (SBA_Customer-information_EN.pdf (swissbanking.ch)).

2.What is the regulatory status of ARROWA AG?

ARROWA AG (“ARROWA” or the “Company”) is a public limited company established under Swiss law that has its registered office in Erlenbach and domicile on Bahnhofstrasse 40. ARROWA is a portfolio manager that provides asset management services to its clients. Viktorija Butelga is the sole shareholder of ARROWA. Viktorija Butelga is the sole director and exclusive administrative board member of ARROWA.

ARROWA is a licensed portfolio manager under the applicable laws and regulations of Switzerland. ARROWA has been licensed by and is under the prudential supervision of the Swiss Financial Market Supervisory Authority, FINMA and under ongoing supervision of the Organisation de surveillance financière, OSFIN, which is authorized by the FINMA.

Since ARROWA has one single managing director, the asset manager must take the necessary precautions to ensure the continuation of business operations if the managing director is impeded or deceased. For this purpose, ARROWA has concluded a so called «business continuity contract» with a portfolio manager. The appointed portfolio manager CAYROS capital AG in Basel (Thiersteinerallee 29, CH-4053 Basel, Switzerland). If ARROWA is continuously prevented from conducting its business, this portfolio manager will deal with the continuation of the client relationship, unless the client requests otherwise.

3.What is the scope of services of ARROWA?

ARROWA provides the following services to its clients:

Portfolio Management: ARROWA manages – except when otherwise stipulated – client assets that are deposited in a bank, based on a power of attorney. ARROWA enters into a written asset management agreement with their clients that regulates the duties and competency as well as the rights of the client. ARROWA services are provided in exchange for a fee that is defined in writing prior to the provision of the services.

The market offering considered in selecting financial instruments includes solely third-party financial instruments.

4.Where is be ARROWA accredited to provide financial services?

ARROWA is accredited to provide portfolio management solely in Switzerland. The privity of contract between the client and ARROWA is solely subject to Swiss law. ARROWA assumes that the clients are aware of this upon entering the business relationship.

5.What are business affiliations of ARROWA?

ARROWA provides portfolio management services independent from banks and offerors of financial products. There are no exclusive obligations. ARROWA recommends banks and security brokers that according to their own judgement offer the best possible execution of the client’s orders under consideration of price and quality to clients upon request for the deposit of assets.

6.What are the general risks?

Portfolio management bears a risk of financial loss, up to the loss of all financial assets entrusted to the Company.

7.What are the particular risks?

ARROWA informs the client unasked for about the risks associated with the services rendered that go beyond the usual risks associated with the buying, selling and holding of securities (“particular risks”). This specific information is provided before the rendering of services and covers the following aspects:

  • Information on the services to be offered;
  • information on the associated risks and costs;
  • information on the market offer taken into consideration when offering financial instruments; and
  • information on possible additional costs.

If the client does not wish to be informed of particular risks of ARROWA’ operations, he/she must make a specific request. The information of risks is provided by the distribution of leaflets and brochures. If the client requires individual information that is associated with the services ARROWA is providing for him/her, then he/she may request this at any time. The same applies for cases in which the client may not have understood the risks described in the distributed leaflets or brochures.

8.What does suitability and appropriateness mean?

It is important that ARROWA provides services suited to the client’s entire financial situation. This calls for a full and frank notification of the financial situation. If a client does not wish to disclose his/her situation in full, ARROWA will not be able to ensure that the recommended and implemented strategies and individual investments are suited to the client’s entire situation. Diverse risks or a concentration of risks could arise, in particular with regards to unilateral investments, a disproportionate composition as a whole, etc. These risks are neither ascertainable nor manageable for ARROWA, due to the lack of corresponding information.

9.What does client segmentation mean?

For the purpose of the client relationship, the client will be segmented in accordance with set rules as set out in the Swiss Financial Services Act. This segment has an influence on the rights of the clients and the duties of ARROWA under Swiss law. In certain cases, a client has the possibility to change the segment. In case a client may want to change his segment, ARROWA will explain the associated risks and the influence on the future relationship with the client.

10.How is ARROWA remunerated?

Remuneration for ARROWA services consists solely of the management fee paid by the clients. ARROWA endeavours to broker services from banks, investment companies and issuers for their customers under the most favourable terms possible. Compensation received by ARROWA from third parties will be passed onto the client – unless conflicting with regulatory guidelines. If compensations from third parties cannot be passed on to the client, this will be disclosed to the client.

11.Are there any conflicts of interests?

In portfolio management, conflicts of interests are not always wholly unavoidable. The interests of the client and the interest of ARROWA, their staff and shareholders can be conflicting. ARROWA therefore lays open the following in connection with possible conflicts of interests:

  • Commissions from banks, fund managements and issuers may evoke financial incentives to deal with stocks or choose products that produce higher commissions, even though this choice may not be in the client’s best interest.
  • ARROWA can subscribe to a new issue of securities itself. An oversubscription can lead to a reduction of client allotments. The same applies if ARROWA staff subscribes to issues.
  • ARROWA submits to its clients a report on its operations based solely upon banking documents. In the documents and statements from the deposit bank, the ARROWA fee is declared as remuneration and not as costs for the portfolio management. A performance expressed in percentage points is therefore declared slightly better that the actual performance according to costs.
  • Should ARROWA acquire shares of officially quoted companies that are subject to registration within the framework of its portfolio management operations of collectively managed clients, ARROWA will file the obligatory reports.

12.Does ARROWA outsource any tasks?

Arrowa has outsourced the following significant operational tasks to third parties: bookkeeping, risk, and compliance services, as well as IT services. The providers of these services are bound by written contracts with ARROWA. They guar­antee high quality of the provided service and discretion. ARROWA remains responsi­ble for the outsourced tasks.

13.Are there any mediation proceedings?

ARROWA is a financial intermediary in accordance with art. 4 para. 3 let. a FinSA. In view of the written asset management agreement with ARROWA, the contractual partners are considered by the law to be qualified investors in accordance with Art. 10 para. 3ter of the Swiss Collective Investment Schemes Act (“CISA”). Under this asset management mandate, products may also be purchased that are solely available to qualified investors. FINMA may exempt such products partially or fully from the provisions on the obligation to issue a prospectus, the obligation to issue a half-yearly report, the obligation to grant investors the right to terminate at any time, the obligation to issue and redeem units in cash or risk distribution. In accordance with art. 10 para. 3ter CISA, clients with a written asset management agreement may declare to ARROWA in writing that they no longer wish to be classified as qualified investors.

14.Are there any mediation proceedings?

If you have differing views on contractual interpretations, you may submit a written complaint to us at any time. The client is entitled to initiate mediation proceedings before FINOS Ombudsman Switzerland, Talstrasse 20, 8001 Zurich, Switzerland (Phone: 044 552 08 00; Email: info@finos.ch). However, it is recommended that you first wait for our opinion. The ombudsman office is neither a court nor does it have jurisdiction. Rather, it promotes discussion between the parties involved and proposes a negotiated solution. Since the parties are not bound by the proposal of the arbitration board, you are free to accept it or to take other measures, such as legal action.

We are pleased to serve you as client of ARROWA.