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Shareholder Rights Directive II (EU) 2017/828: information on the disclosure of Client data

For ease of comprehension, Habib Bank AG Zurich (hereinafter “the Bank”) uses only masculine pronouns in its documentation and legal framework. These are to be understood as including both genders.

1. Purpose of the Shareholder Rights Directive II (EU) 2017/828

The Shareholder Rights Directive II (EU) 2017/828 (“SRD II” or “Directive”) is a Directive of the European Union which came into force on 3 September 2020. It aims to increase transparency between companies and their investors and to promote long-term investor participation. In order to achieve these objectives, the Directive provides for the identification of investors, the transmission of information and the facilitation of the exercise of, in particular, shareholder rights. The minimum requirements in this respect are specified in the Implementing Regulation (EU) 2018/1212, which also came into force on 3 September 2020.

2. Scope of the Directive

The Directive and its national implementing decrees apply to companies established in the European Economic Area (“EEA”); this includes the member states of the European Union, as well as Iceland, Liechtenstein and Norway. The securities issued by companies must be approved for trading on a regulated market in the EEA or a third country.

The types of securities in the regulated markets in the EEA and outside the EEA that fall within the scope of the Directive (“Securities Concerned”) depends on the national transposition laws of the EEA member states. SRD II applies primarily to shares traded on a regulated market. However, some national transposition laws go beyond the European minimum requirements for the Directive, thus extending its scope. For example, bonds, may also fall within the scope of application, provided that an EEA member state incorporates them into national law.

3. Disclosure of Client data

Companies established in the EEA (“Companies”) will have the right to obtain information on the identity of their investors in order to exchange information with them. The right to investor disclosure may be asserted worldwide by a Company against any institution that retains the company’s Securities Concerned. As a consequence of this regulation, the Bank is also required to provide the Company with the Client’s identity at its request if the Client holds Securities Concerned in his custody. Client data may also be sent abroad where the disclosure takes place. The data will no longer be subject to Swiss data Protection Law and bank Client confidentiality. Third parties may have access to the data under local foreign law.

3.1. Is there a threshold for disclosing the identity of investors?

EEA member states may provide that Companies may request information on the identity of investors if a certain threshold of Securities Concerned or voting rights is exceeded. In some EEA member states, for example, identification is possible if an investor holds more than 0.5% of the securities or voting rights concerned.

3.2. Which Client data is disclosed?

At the request of a Company, the minimum information to be provided includes:

• Name and contact details (including full address and if available, e-mail address);
• if the Client is a legal entity, the national registration number or a unique identifier such as the “Legal Entity Identifier” must be provided;
• the number of securities held, and
• the categories or classes of the Securities Concerned and the date from which they are held.

3.3. Can an investor refuse to disclose his Client data?

The Bank is required to disclose the identity of investors upon request. Bank Clients cannot, therefore, opt out of disclosing the necessary information to the requesting Company if Securities Concerned are in their custody. If the Client does not wish to disclose his Client data, he must refrain from purchasing or holding Securities Concerned.

4. Facilitating the exercise of shareholder rights

The new rules require the Bank to facilitate the exchange of certain additional information between the Company and the investor. Therefore, after receiving information from a Company, the Bank informs its Clients about general meetings and other corporate events. In addition, at the request of its Clients, the Bank can facilitate registration for general meetings.

Information regarding the Swiss deposit insurance scheme ESISUISSE

Dear Valued Customers,

Your deposits are protected under the deposit insurance ESISUISSE.

Like any bank and any securities firm in Switzerland, Habib Bank AG Zurich is required to sign the Self-regulation “Agreement between ESISUISSE and its members”. This means clients’ deposits are protected up to a maximum of CHF 100,000 per client. Medium-term notes held in the name of the bearer at the issuing bank are also considered deposits. Depositor protection in Switzerland is provided by ESISUISSE, and the depositor protection system is explained in detail at https://www.esisuisse.ch/en.

Habib Bank AG Zurich
Switzerland

Automatic Exchange of Information (AEOI)

Habib Bank AG Zurich (hereinafter “the Bank”) is a reporting Swiss financial institution in accordance with the Federal Act on the International Automatic Exchange of Information in Tax Matters (AEOI Act). The AEOI Act is the legal basis for implementing the AEOI Standard in Switzerland. This communication is intended to inform you as required by Article 14 of the AEOI Act.

What is AEOI?

AEOI requires reporting Swiss financial institutions to identify reportable accounts and report them to the Federal Tax Administration (FTA). Reportable accounts are accounts held by natural persons as well as accounts held by entities. If an account is held in a fiduciary capacity by a natural person or an entity that is not a financial institution on behalf of or for the account of a third party, that third party or the beneficial owner is deemed to be the account holder for the purposes of AEOI. In the case of accounts held by entities, the requirement to identify and report may concern under certain circumstances also the controlling person(s). For more detailed information on the terms “account holder” or “controlling person” please consult the OECD Common Reporting Standard and the implementing legal provisions.

Only accounts where the holder or controlling person is a reportable person are reportable accounts. A reportable person is a natural person or an entity resident for tax purposes in a country with which Switzerland has agreed AEOI (partner state(s)).

Reporting Swiss financial institutions are required to report information on reportable accounts held by reportable persons annually to the FTA. After receiving this information, the FTA exchanges it with the reportable person’s country of residence. Information is only exchanged with partner jurisdictions. The list of partner jurisdictions can be found here and is kept up to date at all times.

What information will be exchanged?

The reportable information includes personal data and information concerning the reportable account. Personal data include the name, address, country of residence for tax purposes, tax identification number and date of birth of the account holder or of the beneficial owner or the controlling person. In addition, the account number, the total gross amount of dividends, interest and other income, the total gross proceeds from the sale or redemption of financial assets, and the aggregate balance or value of the account at the end of each calendar year are reported. Moreover, the name and identification number (where available) of the Bank are also reported.

For what purposes will this information be used?

Generally, the information exchanged may only be made available to tax authorities of a partner jurisdiction in which the reportable person is resident and may only be used for tax purposes. In principle, it is prohibited for the receiving partner jurisdiction to forward the received information to another jurisdiction, and it must treat the information as confidential. Generally, the receiving partner jurisdiction may only make the information exchanged available to persons and authorities responsible for handling or supervising taxation in that country.

What rights do you have?

1) Vis-à-vis the Bank

You are entitled to the full extent of legal protection offered by the FADP vis-à-vis the Bank. In particular, you have the right to request what information has been collected about you and will be reported to the FTA.

The Bank must provide you with a copy of its report to the FTA on request. In this regard, it must be noted that the information about you that is collected and reported may differ from your tax-relevant information. Moreover, you are also entitled to request that incorrect data in the Bank’s systems be corrected.

2) Vis-à-vis the FTA

Your only right vis-à-vis the FTA is the right to access information. You are entitled to request that incorrect data resulting from errors in the exchange process be corrected.

If the exchange of information would result in disadvantages for you that are not permissible due to a lack of constitutional guarantees, your rights are set out in Article 25a of the Federal Act on Administrative Procedure.

You do not have the right to access FTA records. This means that you do not have the right to block the disclosure of personal details vis-à-vis the FTA. In addition, you are not entitled to have the legality of forwarding information outside Switzerland reviewed or to block any illegal forwarding and/or to demand the destruction of data processed without a sufficient legal basis.

If, in your capacity as a contracting partner of the Bank, you are not the account holder for the purposes of AEOI (see above), or if you are an entity for which the Bank is required to identify and report one or more controlling persons, we ask you to forward copies of this mailing to all of the relevant persons.