Saxo Bank issues notice regarding ETF KID solution for WL partners
Multi-asset investment specialist Saxo Bank has issued a notice regarding the ETF KID solution for its White Label partners.
In order to comply with the PRIIPs & UCITS regulation regarding Key Information Documentation (KID) & Key Investor Information Documentation (KIID), retail clients (based on their Mifid II classification) residing within the EU need to be presented with the possibility of viewing a KID/KIID either before or immediately after trading.
Saxo ensures it has provided a KID/KIID prior to trading through the implementation of a KID-availability check; if the check fails, the client is restricted from placing an order and will receive a general notification “xxx due to instrument configuration”. This notification can also be triggered due to other rules than the KID-check, e.g. if it is a general reduce-only instrument, such as US OTC stocks.
It is the manufacturer/issuer of the instrument, who is responsible for providing the KID/KIID, but is not obliged to do so. Saxo as a distributor has chosen not to do any translations of the KIDs available from manufacturers, meaning we only distribute KIDs that ETF issuers produce themselves.
Saxo says it will not be able to add KIDs or request from an issuer to produce additional KIDs. The client/WL partner themselves need to contact the ETF issuer to enquire about such possibilities.
Certain criteria go into the KID-availability check, which must be satisfied for the client being able to place an order in the instrument.
The language criteria is general and applicable to all the products where a KID-availability check has been enabled. The appropriate language is as a general rule of thumb based on the client’s country of residence + English per default. KIDs can be issued in many different languages.
In addition to the language check, there is an additional check which ‘Market’ the instrument is intended for. KIDs are issued either for a specific “Market” or for a generic “undefined” market (which means it´s intended for clients of all countries)
Clients classified as Professional (e.g. via Saxotools) will be able to trade all ETFs and no restrictions will be applied.
Clients residing outside the affected EU countries will be able to trade all ETFs and no restrictions will be applied. As basis of country of residence check the system is reviewing the country entered as “Tax Country” on Counterpart level (in Saxotools (CCM)).