Conflicts of Interest Policy

Overview

  1. In accordance with the MFSA Conduct of Business Rulebook and the Capital Markets Rules, Rizzo Farrugia is required to establish, implement and maintain an effective policy to prevent conflicts of interest that may arise in the provision of its investment and ancillary services or a combination thereof from adversely affecting the interests of its Clients, including their sustainability preferences as well as prevent any conflict of interest that may arise in the provision of Sponsor services. The term ‘Sponsor’ shall have the meaning as assigned to it in the Capital Markets Rules.

 

Objective of the Policy

  1. The purpose of this policy is to provide information on the approach Rizzo Farrugia takes in order to avoid or identify and fairly manage the conflicts of interest that may arise during the course of its business activities.
  2. The main categories of potential conflicts of interest involve those arising between the differing interests of:

a. Rizzo Farrugia and a Client;

b. Rizzo Farrugia’s directors, or employees (each a “‘Relevant Person”) and a Client; and

c. Two or more Clients of Rizzo Farrugia during the course of the provision of an investment service;

d. A person, corporate or otherwise, that directly or indirectly is linked by control to the firm; and

e. When providing Sponsorship Services, between Rizzo Farrugia and/or its directors or employees (each a “Relevant Person”), the applicant or issuer (“Applicant”) requesting admissibility to listing of securities and the Clients upon the provision of investment service.

 

Definition of Conflict of Interest

  1. A conflict of interest is considered to exist where in the course of providing an investment service or ancillary services or investment activities or otherwise or Sponsor services, the interest of a Client may be adversely affected. For the purposes of identifying types of conflicts of interest that may adversely affect the interests of a client, Rizzo Farrugia shall take into account and determine whether itself or a Relevant Person or a person directly or indirectly linked by control to the firm:

a. Has made or is likely to make a financial gain or has avoided or is likely to avoid a financial loss at the expense of the Client;

b. Has an interest in the outcome of a service or of a transaction carried out on behalf of a Client, which is distinct from the interest of the Client in that outcome;

c. Has an incentive, financial or otherwise, to favour the interest of a Client or group of Clients over the interest of another Client or group of Clients;

d. Carries on the same business as the Client.

e. Received or will receive from a person other than the Client an inducement in relation to a service provided to the Client, in the form of monetary or non-monetary benefits or services.

f. When acting as Sponsor, it has an interest, or a holding of 5% or more of Equity or Debt Securities of the Applicant or any other company in the Applicant’s Group and it has any relationship with other than acting as Sponsor, or a financial interest (whether directly or indirectly) in the Applicant or any other company within the Applicant’s Group that would give the Sponsor a material interest in the outcome of the transaction or which could be perceived as a conflict of interest. (“Interest”); For avoidance of doubt, any interest that arise as a result of Rizzo Farrugia’s discretionary client holdings or nominee holdings for execution-only clients are not to be considered for the purposes of such determination.

g. When acting as Sponsor, in circumstances where the Sponsor is not considered to be independent of an Applicant if its directors, partners, or senior officers of the Sponsor or another company in the Sponsor’s Group has a material interest (“Material Interest”) or is in any way involved in the Applicant or any other company in the Applicant’s Group (“Involvement”).

h. When individuals forming part of the Sponsor service offering are concurrently or subsequently involved in the distribution on the primary market of the financial instrument/s which are the subject of the application of Admissibility to Listing on which it has been appointed as Sponsor.

 

Identification of potential Conflicts of Interest

  1. Conflicts of interest may arise in various scenarios and generally when Rizzo Farrugia is performing one or more of the following functions:

a. Creation and distribution of investment research reports;

b. Provision of investment advice;

c. Provision of discretionary management services;

d. Execution and reception and transmission of orders on the account of Rizzo Farrugia or a Relevant Person;

e. Provision of sponsor and corporate advisory services;

f. Dealing on own account;

g. Placing of instruments on a firm commitment basis; and

h. Acting as Sponsor under the Capital Markets Rules.

 

Conflict management procedures

  1. Rizzo Farrugia maintains and operates effective organisational and administrative procedures to fairly and promptly manage any conflicts of interest which may arise from time to time and to ensure that the persons involved in the different activities, which may give rise to a conflict of interest, carry on those activities at an appropriate level of independence. Rizzo Farrugia also undertakes ongoing monitoring of business activities to ensure that internal policies, procedures and controls are appropriate for the prevention and management of conflicts of interest.
  2. Where a Group of Companies is said to exist, any organisational and administrative procedures shall take into account any circumstances of which Rizzo Farrugia is or should be aware, which may give rise to a conflict of interest resulting from the structure and business activities of any other members of a Group.
  3. When acting as Sponsor and for so long as it is so appointed, Rizzo Farrugia shall take all reasonable steps to identify and manage any conflicts of interest that could adversely affect its ability to properly perform its Sponsorship functions, and accordingly considers those circumstances which could:

(i) create the perception that it may not be able to perform its functions properly; and/or

(ii) compromise its ability to fulfil its obligations to the MFSA when appointed as Sponsor; and/or

(iii) negatively impact market confidence in Sponsors.

 

  1. Rizzo Farrugia has adopted the following measures and controls in order to manage conflicts of interest:

i. Rizzo Farrugia maintains internal procedures which set out the manner in which employees should manage instances which could lead to conflicts of interest and internal guidelines for employees, relating to the identification, prevention and management of conflicts of interest.  Rizzo Farrugia also maintains a conflict of interest register through which it identifies and records conflicts of interest and documents the action taken to manage these conflicts.

ii. Rizzo Farrugia maintains personal account dealing procedures that regulate personal transactions of Relevant Persons executed through Rizzo Farrugia or through any other licenced intermediary.

iii. Rizzo Farrugia staff members may not affect personal transactions in publicly traded securities without the prior consent of the Compliance Officer of Rizzo Farrugia.

iv. Rizzo Farrugia adopts effective procedures to prevent or control the exchange of information between Relevant Persons engaged in activities involving a risk of a conflict of interest where the exchange of that information may harm the interests of one or more Clients.

v. Rizzo Farrugia maintains in accordance with the Market Abuse Regulation (MAR) including any delegated acts and/or technical standards issued thereunder a list of persons (“Relevant Persons”) that may be in possession of inside information as defined under the MAR and shall notify and undertake oversight that such Relevant Persons are made aware of their prohibition to attempt or use that Information, by acquiring or disposing of, for our own account or for the account of third parties, directly or indirectly as well as by way of cancellation and/or amendment of already placed orders concerning a financial instrument to which the Information relates and that such Relevant Person shall keep the Information strictly confidential and not, directly or indirectly allow or communicate or disclose or make available, that Information to any other person or exploit the Information in any way unless otherwise deemed as Legitimate Behaviour under MAR.

vi. Rizzo Farrugia has procedures and arrangements that provide for the prompt, fair, and expeditious execution of Client orders.  To ensure the fair treatment of all Clients’ orders, the Best Execution Policy (‘BEP’) of Rizzo Farrugia requires employees to take all sufficient steps to achieve the best possible result for the Client. The BEP clearly provides that Client orders are to be executed in accordance with the time of their receipt and the price considerations.

vii. Rizzo Farrugia may have or enter into relationships with third-parties who may remunerate the Company by way of commissions or non-monetary benefits.  Rizzo Farrugia shall ensure that any such commissions and / or non-monetary benefits provided by third parties does not impair its duty to act in the best interest of the Clients. Rizzo Farrugia shall disclose to the Client the existence, nature and amount of any payment or benefit, including non-monetary benefits priced and disclosed separately (other than minor non-monetary benefits), designed to enhance the quality of the relevant Service to the Client.

viii. Rizzo Farrugia has procedures in place to facilitate the identification and regulate the classification of all relevant inducements in order to ensure that such inducements do not impair Rizzo Farrugia’s ability to act in the best interests of its Clients.

ix. Rizzo Farrugia ensures that all the remuneration of Relevant Persons is carefully structured to promote sound and effective risk management whilst ensuring that such Relevant Persons act in the best interest of the Client.

x. Rizzo Farrugia has a remuneration policy applicable to all directors and employees that is predominantly based on a fixed salary and variable remuneration of Relevant Persons is limited to not more than 100% of the fixed remuneration. Additionally, any variable remuneration is not directly relating to the sales practices or distribution of Financial Instruments by such Relevant Persons, ensuring the removal of any direct link between the remuneration of Relevant Persons and the levels of business generated by Relevant Persons, thereby ensuring the avoidance of conflict between the personal interests of Relevant Persons and the best interests of Clients.

xi. Rizzo Farrugia provides training on an ongoing basis to ensure that its Relevant Persons are aware of all obligations and procedures applicable when providing any investment service.

xii. Rizzo Farrugia, its Directors and employees shall avoid placing themselves in a situation where a conflict with the interest of a Client may arise.  Employees and Directors must disclose to the Compliance Officer any situations that reasonably would be expected to give rise to, or the appearance of, a conflict of interest.

xiii. Where Rizzo Farrugia has a material interest in a transaction, before undertaking the transaction for or on behalf of a client, Rizzo Farrugia shall disclose the material interest to the Client.

xiv. Rizzo Farrugia shall not act as Sponsor unless it is independent of an Applicant and in any event shall, it shall not act as Sponsor, or the Group of which the Sponsor forms part, where it has an Interest, a Material Interest or an Involvement as aforementioned.

xv. Rizzo Farrugia has proper arrangements in place to ensure that the individuals forming part of the sponsor service offering are not concurrently or subsequently involved in the distribution on the primary market of the financial instrument/s which are the subject of the application of Admissibility to Listing on which it has been appointed as Sponsor.

xvi. For each application in respect of which it acts or intends to act as Sponsor, Rizzo Farrugia submits to the MFSA a confirmation of its independence.

xvii. Rizzo Farrugia ensures that measures are in place to prevent or limit any person from exercising inappropriate influence over the way in which it carries out a Service or Ancillary services or distribution activities, including through the establishment of an Investment Committee established to review, amongst others, the Financial Instruments recommended to Clients under Investment Advice and/or Discretionary Portfolio Management within the Target Markets.

xviii. Rizzo Farrugia ensures that separate supervision by senior management is exercised in relation to those functions involving the carrying out activities on behalf of, or providing services to, Clients whose interests may conflict, or who otherwise represent different interests that may conflict, including those of Rizzo Farrugia.

xix. Rizzo Farrugia monitors the effectiveness of the Policy on an annual basis.

 

Disclosure of Conflict of Interest

  1. Whilst disclosure is deemed to be a measure of last resort and required only where organisational or administrative arrangements in place at Rizzo Farrugia are not sufficient to ensure, with reasonable confidence, that risks of damage to Client interests will be prevented, Rizzo Farrugia shall disclose this fact to the Client that such arrangements in place are not capable of ascertaining with reasonable confidence that risks of damage to Client interests will be prevented, the general nature and sources of conflicts of interest, a specific description of that conflict of interest as well as the risks to the Client that arise as a result of the conflict  and the steps taken to mitigate those risks before undertaking business on its behalf Client. Such disclosure shall include sufficient detail, taking into account the nature of the Client, to enable that Client to take an informed decision with respect to the Service in the context of which the conflict of interest arises.
  2. Rizzo Farrugia shall assess and review, at least annually, this Conflicts of Interest Policy and take all appropriate measures to address any deficiencies.

 

Last updated 18.02.2026