Deutsche Bank

Group Policy

Conflicts of Interest Policy –

Deutsche Bank Group

Breaches of provisions within this document will be viewed as a violation of your terms of
employment and may result in disciplinary action, up to termination of employment, in line with
Deutsche Bank’s policies, as well as local law and practice.

The information contained herein is the property of Deutsche Bank Group and may not be copied, used or disclosed in
whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical,
reprographic, recording or otherwise) outside of Deutsche Bank Group without prior written permission.
Conflicts of Interest Policy – Deutsche Bank Group

Table of Contents
0. Key Data........................................................................................................................................................ 3
1. Scope............................................................................................................................................................. 4
2. What are Conflicts of Interest? ................................................................................................................. 4
3. Approach to Conflicts Management ....................................................................................................... 4
4. Employee Responsibilities ........................................................................................................................ 5
All Employees ................................................................................................................................ 5
Supervisors .................................................................................................................................... 6
Senior Management ..................................................................................................................... 6
DB Group Entity Board Members .............................................................................................. 6
5. Glossary ........................................................................................................................................................ 7
6. List of Annexes .......................................................................................................................................... 10
Annex 1: Conflicts of Interest relationships, scenarios and specific examples ............................. 11
Annex 2: Description of organisational arrangements relating to Conflicts of Interest............... 14
Annex 3: Description of policies, procedures, systems and controls relating to Conflicts of
Interest .......................................................................................................................................... 16

Page 2
Conflicts of Interest Policy – Deutsche Bank Group

0. Key Data

Summary

This policy sets out the Bank’s arrangements in connection with the identification, documentation,
escalation and management of Conflicts of Interest, including where such Conflicts of Interest arise
in the context of MiFID Business.

Document Category

Group Policy ☒ Non-Group Policy ☐

Group Procedure ☐ Non-Group Procedure ☐

Applicability

DB Group ☒ Restricted to:

Issuing Unit Compliance

Risk Type

Conflicts of Interest

Risk Type Authorisation

(i) Risk Type Control Function, as per Group’s risk Type taxonomy; and / or ☒

(ii) Approval by the relevant Risk Type Controller / RTC Contact / issuing Unit ☐

(iii) Management Board resolution ☐

(iv) Business Allocation Plan of DB AG ☐

Addressees
All Employees

Management Board approval ☒ Date of approval 20.12.2016

Implementation Date

Publication date

Page 3
Conflicts of Interest Policy – Deutsche Bank Group

1. Scope
This policy sets out the Bank’s arrangements in connection with the identification, documentation,
escalation and management of Conflicts of Interest, including where such Conflicts of Interest arise
in the context of MiFID Business.
This policy applies to all Employees. It also applies to Contingent Workers. Managers of Units that
engage Contingent Workers must familiarise themselves with the requirements in this policy and
must exercise their supervisory duties accordingly.
Capitalised terms have the meaning ascribed to them in section 5.

2. What are Conflicts of Interest?

A Conflict of Interest is a situation where one or more persons or entities have competing interests
and the serving of one interest may involve detriment to another. This policy applies to the extent
that a Conflict of Interest gives rise to the risk of one or more of the following:
i. the Bank and/or an Employee failing to comply with legal or regulatory obligations;
ii. the Bank and/or an Employee failing to fulfil a duty of care, trust or loyalty owed to another
person or entity such as a Client;
iii. an Employee’s professional judgement and objectivity being compromised and/or hindering
the proper discharge of their duties and responsibilities;
iv. an Employee engaging in unethical conduct; and/or
v. the Bank obtaining improper advantage or treatment or giving rise to the appearance of
impropriety and reputational damage, including as it relates to the manner in which
business is awarded to or by the Bank.
A Conflict of Interest under this policy includes both an actual Conflict of Interest (i.e. a Conflict of
Interest that has arisen) and a potential Conflict of Interest (i.e. a Conflict of Interest that may arise
given particular facts and circumstances). It also includes a perceived Conflict of Interest (i.e. a
situation which may give rise to the perception of a Conflict of Interest), even where a Conflict of
Interest may not in fact exist.
Certain Conflicts of Interest are persistent and need to be managed on an ongoing basis, while
others may arise in relation to a single event (e.g. a transaction) and can usually be managed by
one-off measures.
Failure to identify and appropriately manage Conflicts of Interest could result in inappropriate or a
range of adverse consequences for Clients, the Bank and Employees, such as reputational damage,
damage to client relationships and loss of client business, regulatory sanctions, and risk of litigation.
To assist in the identification of Conflicts of Interest, Annex 1 includes non-exhaustive lists of (i)
relationships where Conflicts of Interest may arise and (ii) Conflicts of Interest scenarios, as well as
(iii) a sample of specific examples of circumstances in which these Conflicts of Interest arise.

3. Approach to Conflicts Management

The Bank seeks to ensure that a Conflict of Interest does not adversely affect the interests of
Clients, the Bank, its shareholders or other stakeholders through the identification, prevention or
management of the Conflict of Interest.
Some Conflicts of Interest are not permitted as a matter of law or regulation and others are
permitted so long as the Bank has appropriate means by which to manage them. The Bank may
utilise a number of means (which may be used individually or in combination) to manage a Conflict
of Interest including:
i. organisational arrangements which are described in Annex 2;
ii. policies, procedures, systems and controls which are described in Annex 3;

Page 4
Conflicts of Interest Policy – Deutsche Bank Group

iii. disclosure designed to inform the affected parties of the Conflict of Interest and its likely
impact on them which is described in Annex 3; or
iv. avoidance of the service, activity or matter giving rise to the Conflict of Interest where the
Conflict of Interest cannot be prevented or managed effectively using other means.

4. Employee Responsibilities
As part of the Bank’s approach to conflicts management, Employees must fulfil the responsibilities
outlined below when performing their roles at the Bank.

All Employees
All Employees are responsible for identifying and managing Conflicts of Interest on an ongoing
basis and are required to:
i. comply with this policy, Rules and other applicable policies and procedures relating to the
identification, documentation, escalation and management of Conflicts of Interest;
ii. act with integrity and exercise good judgement and discretion;
iii. act with the requisite degree of independence and objectivity when discharging their
responsibilities at the Bank;
iv. avoid, wherever possible, situations giving rise to Conflicts of Interest due to any of the
following:
a. personal financial interest;
b. Family Members or Close Personal Relationships;
c. previous, current or potential future involvement in an activity or endeavour (whether
at the Bank or externally); or
d. different roles and responsibilities at the Bank;
v. immediately notify their supervisor and/or Compliance of the existence and general nature
of a Conflict of Interest;
vi. immediately disclose Conflicts of Interest to the chairperson when participating in decision
making fora and, if the chairperson so determines, remove themselves from the decision
making process and not seek to influence such decisions any further;
vii. not be in a supervisory, subordinate or control relationship (having influence over conditions
of employment) with closely related persons including Family Members or Close Personal
Relationships;
viii. not misuse information obtained in the course of working at the Bank including in
connection with dealing in securities;
ix. manage work-related information on the basis of the Bank’s need-to-know principle,
respecting information barriers and duties of confidentiality at all times;
x. challenge and escalate promptly issues of concern to their supervisors and Compliance so
that Conflicts of Interest may be appropriately reviewed, managed and resolved;
xi. upon joining the Bank and on a periodic basis thereafter, complete all attestations required
by Compliance; and
xii. comply with applicable Rules which require transactions and arrangements between the
Bank and a Related Party to be carried out on an independent, arms-length basis.

Page 5
Conflicts of Interest Policy – Deutsche Bank Group

Supervisors
Employees who act in a supervisory capacity are required to:
i. actively seek to identify, mitigate and, to the extent required by Unit procedures, document
Conflicts of Interest in their area of responsibility, including in connection with any current
or planned activities;
ii. assess any Conflicts of Interest reported to them to determine if a Conflict of Interest exists;
iii. determine, after consulting Compliance and other control functions as required, the best
course of action to resolve, manage or avoid the Conflict of Interest, including further
escalation to a higher management authority where necessary or the (temporary or
permanent) withdrawal of oversight of a given matter or activity from the Employee
concerned;
iv. review on an annual basis or more regularly, if required, any reported Conflicts of Interest to
ensure these are being managed in accordance with any agreed resolution; and
v. allocate responsibilities to Employees who report to them in a manner that does not lead to
Conflicts of Interest and avoid allocation of responsibilities which will compromise the
independence of control functions of the Bank.

Senior Management
Members of Senior Management are responsible for overseeing the identification, documentation,
escalation and management of all Conflicts of Interest as they arise within their relevant areas of
responsibility at the Bank. Members of Senior Management are required to:
i. sponsor and encourage an appropriate culture which emphasizes the importance of ethical
treatment of Clients and the fair handling of Conflicts of Interest;
ii. be engaged in the implementation of policies, procedures and arrangements for the
identification, documentation, escalation, management and ongoing monitoring of Conflicts
of Interest;
iii. be engaged in the clear communication of policies, procedures and expectations and the
sharing of best practice throughout the Bank;
iv. adopt a holistic view to identifying potential and emerging Conflicts of Interest within and
across Business Divisions and Infrastructure Functions and to facilitate informed
judgements with respect to materiality and the manner in which conflicts are handled;
v. raise awareness and promote adherence of Employees in completing regular training both
at induction and in the form of refresher training;
vi. sponsor systems and controls to document, track, manage and mitigate Conflicts of Interest
risk, and regularly review their effectiveness;
vii. consider the implications and take corrective action, where required, in connection with
performance measurements or incentive schemes that may incentivise an Employee to act
contrary to the duties and responsibilities owed to the Bank and under applicable Rules;
and
viii. utilise management information to remain sufficiently up-to-date and informed in
connection with the matters listed above.

DB Group Entity Board Members

Key obligations of Board Members of DB Group Entities in connection with Conflicts of Interest are:
i. Board Members must generally act in the best interest of the DB Group Entity they
represent and ensure that procedures are in place so that transactions between the DB

Page 6
Conflicts of Interest Policy – Deutsche Bank Group

Group Entity and Deutsche Bank AG and/or another DB Group Entity are generally
undertaken only on an arms-length basis. In this context, a Board Member:
a. may consider the aligned interests of the Bank as an element in their decision-making
process;
b. may give the Bank’s interest significant weight where the Board Member considers
this to be in the best interest of the relevant DB Group Entity; and
c. has the responsibility to weigh the merits of the DB Group Entity’s interests and the
Bank's interests in the decision-making process;
ii. Board Members must ensure that business decisions are unaffected by Conflicts of Interest
and must therefore:
a. proactively identify Conflicts of Interest resulting from their Board position (whether
as a member of the management or the supervisory function) and disclose such
Conflicts of Interest as required by the applicable terms of reference and Rules; and
b. refrain from any action that might be detrimental to the DB Group Entity for which
they are a Board Member. Material Conflicts of Interest, individually and collectively,
should be adequately documented, communicated to, discussed and duly managed
by the relevant Board;
iii. In general, a Board Member must not be involved in any kind of business which is in
competition with the DB Group Entity in which the Board membership is held without prior
approval by the shareholders of the relevant DB Group Entity or the Board, as applicable
under the relevant Rules;
iv. A Board Member cannot represent the DB Group Entity in dealings with himself or herself,
or with a third party represented by himself or herself, unless the relevant Rules permits
such representation on the basis of consent (for example, by way of shareholders’,
supervisory or unitary management board resolution) and such consent is granted.

5. Glossary
Term Definition

Audit the Bank’s group audit department;

Bank Deutsche Bank AG, its domestic and foreign branches, its representative offices
and DB Group Entities;

Benchmark a “Benchmark” is defined under the Benchmark Policy as any index which is used
for reference for purposes that include one or more of the following:
 determining the interest payable, or other sums due, under loan
agreements or under other financial contracts or instruments;
 determining the price at which a financial instrument may be bought or
sold or traded or redeemed, or the value of a financial instrument; and/or
 measuring the performance of a financial instrument or an investment
fund. 1

Board the governance body or bodies with responsibility for a DB Group Entity;

Board Member a member of a Board;

Business Divisions all front office divisions within the Bank: Corporate Bank; Investment Bank; Private
Bank; and Capital Release Unit

Client any of the following:

1 Use of an index in measuring the performance of an investment fund includes using an index for the purpose of tracking
the return of an index or combination of indices, defining the asset allocation of a portfolio or of computing the performance
fees.

Page 7
Conflicts of Interest Policy – Deutsche Bank Group

Term Definition
a) an existing client of the Bank;
b) a potential client of the Bank (where the Bank is seeking to enter into a
relationship with the potential client in respect of services or transactions);
or
c) a past client where fiduciary or other duties remain in place;

Close Personal any of the following:

Relationship a) a romantic relationship of an Employee;
b) a personal business, commercial or financial relationship of an Employee;
or
c) a cohabitee of an Employee

COI Framework the Bank’s Conflicts of Interest framework for the oversight and governance of
Conflicts of Interest as set out in the Conflicts of Interest: Minimum Standards
Framework Procedure – DB Group;

Compliance the Bank’s compliance department;

Compliance Control the Compliance function at the Bank which is made up of regional control rooms to
Room form part of a global network providing control room coverage for the Bank;

Conflict of Interest a situation where one or more persons or entities have competing interests and the
serving of one interest may involve detriment to another.

Conflicts Office the Bank’s Business Selection and Conflicts Office;

Conflicts of Interest a summary description, set out in the COI Framework, of circumstances across the
Taxonomy Bank which constitute or give rise to Conflicts of Interest including those which
entail a material risk of damage to one or more Clients;

Conflicts of Interest the risk types set out in the Bank’s risk type taxonomy for which Compliance is
Risk Type ascribed as the 2nd Line of Defence risk type controller (more fully described in the
COI Framework);

Contingent Worker individuals who are working for the Bank, but are not directly employed by the Bank
(including officers, consultants, contractors, Tied Agents and agency workers);

DB Group Entity any legal entity in which Deutsche Bank AG, directly or indirectly, holds more than
50 per cent of the equity or voting capital share (or equivalent);

Employee Any individual with an employment contract directly with the Bank.

Employee Trading personal trading activities of Employees;

Episodic Conflict a Conflict of Interest that arises as a result of an event or change in circumstance,
either during the execution of a transaction or after the closing of a transaction, in
particular where the Bank has ongoing roles and responsibilities in connection with
or related to the transaction or retains an economic interest in the transaction;

Family Member in relation to an Employee, a spouse, civil partner, domestic partner, children or
step-children, parent or parent-in-law, sibling or sibling-in-law, grandparent, aunt,
uncle, nephew, and niece;

Human Resources the Bank’s human resources department;

Inducement paying or receiving any fee, commission monetary or non-monetary benefit, or the
receipt of Performance-based Commissions in relation to the provision of
investment service and/or ancillary service to a Client;

Information Barriers the physical and electronic barriers which help control the flow of information within
the Bank;

Infrastructure the following infrastructure functions within the Bank: the Chief Operating Office;
Functions Chief Financial Office; Group Audit; Human Resources; Legal; Regulation,
Compliance and Anti-Financial Crime; Research; and Risk;

Page 8
Conflicts of Interest Policy – Deutsche Bank Group

Term Definition

Legal the Bank’s legal department;

Management Board the management board of Deutsche Bank AG;

MiFID Business the provision of the Investment and Ancillary Services detailed in Section A and B of
Annex I of MiFID II (EU Markets in Financial Instruments Directive 2014/65/EU)
where MiFID II applies;

Outside Business any interests or activities undertaken by Employees outside their role at the Bank
Interest which are disclosable to the Bank under the Bank’s policies and procedures
including without limitation, external business interest, directorships, external
employment and political office appointments;

Performance-based any variable monetary and/or non-monetary benefit provided to the Bank which is
Commission linked to the Bank’s performance in relation to a particular matter or activity which
may include commissions paid by reference to different variables including
achievement of defined turnovers or sales targets. Such benefits qualify as
performance-based even if they take effect in another assessment period.

Related Party any person or entity who is considered a related party of the Bank under applicable
corporate law of the entity’s country of incorporation. Examples include a parent,
subsidiary or fellow subsidiaries;

Research the Bank’s research department;

Risk the Bank’s risk department;

Rules any laws, regulations, rules, supervisory expectations, codes of conduct/ethics, and
standards of good or best practice relating to Conflicts of Interest applicable to the
Bank;

Senior Management those Employees who are responsible for, or have significant influence over, the
direction and day-to-day management of Deutsche Bank AG (including all
management positions in the two levels below the Management Board) and/or a DB
Group Entity;

Supervisory Board the supervisory board of Deutsche Bank AG;

Third Party any of the following:

Representative a) an appointed representative (or where applicable, Tied Agent) of the Bank
who is involved in the Bank’s provision of services to a Client;
b) an employee of an appointed representative (or where applicable, Tied
Agent) of the Bank as well as any other natural person whose services are
placed at the disposal and under the control of the Bank or a Tied Agent of
the Bank and who is involved in the provision of services by the Bank to a
Client; or
c) natural person who is involved in the provision of services to the Bank or its
appointed representative (or where applicable Tied Agent) under an
outsourcing arrangement;

Tied Agent a legal or natural person who acts on behalf of the Bank under its full and
unconditional responsibility, promotes investment services and/or ancillary services
to clients or prospective clients, receives and transmits instructions or orders from
the client in respect of investment services or financial instruments, places financial
instruments and/or provides advice to clients or prospective clients in respect of
those financial instruments or investment services;

Unit(s) all Business Divisions and Infrastructure Functions;

Vendors vendors, suppliers or service providers, consultants and advisors to the Bank.

Page 9
Conflicts of Interest Policy – Deutsche Bank Group

6. List of Annexes
Annex 1: Conflicts of Interest relationships, scenarios and specific examples
Annex 2: Description of the organisational arrangements relating to Conflicts of Interest
Annex 3: Description of policies, procedures, systems and controls relating to Conflicts of Interest

Page 10
Conflicts of Interest Policy – Deutsche Bank Group

Annex 1: Conflicts of Interest relationships, scenarios and specific examples

1. Relationships giving rise to Conflicts of Interest (non-exhaustive)

Conflicts of Interest under this policy arise in a variety of relationships which are often closely
related and may overlap. This includes Conflicts of Interest that arise between:
i. a Client and the Bank, an Employee or a Third Party Representative;
ii. two or more Clients in the context of the provision of services by the Bank to those Clients;
iii. the Bank and an Employee, Vendor, Third Party Representative or material shareholder;
iv. two or more Units, Employees or DB Group Entities; or
v. Deutsche Bank AG and DB Group Entities.

2. Conflicts of Interest scenarios (non-exhaustive)

A non-exhaustive list of common Conflicts of Interest scenarios is set out below.

2.1. Client-related conflicts

Conflicts of Interest relating to Clients can be broadly described as scenarios where the Bank, an
Employee or a Third Party Representative:
i. is likely to make an inappropriate financial gain or avoid financial loss at the expense of a
Client;
ii. has an interest in the outcome of a service provided to a Client or of a transaction carried
out on behalf of a Client which is different from the Client’s interest in that outcome;
iii. has a financial or other incentive to favour the interest of a Client or group of Clients over
the interests of another Client;
iv. carries on the same business as a Client;
v. receives 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 monies, goods or services, other than a
standard commission or fee for that service; or
vi. has a financial or other incentive to favour the sale of a particular product or service to a
Client which is not in the best interest of the Client.

2.2. Bank-related conflicts

Conflicts of Interest relating to the Bank can be broadly described as scenarios where:
i. an Employee’s interest in the outcome of a particular activity or endeavour differs from the
Bank’s interest;
ii. an Employee (or, where applicable, a Family Member or Close Personal Relationship)
receives a financial or other significant benefit as a result of the Employee’s position at the
Bank that is inappropriate in nature;
iii. an Employee has the opportunity to influence the Bank granting business or making
administrative and other material decisions in a manner that leads to personal gain or
advantage for the Employee or a Family Member or Close Personal Relationship;
iv. an Employee’s existing financial or other interest or previous engagement in an endeavour
or activity or relationship with another person, impairs or could impair their judgment or
objectivity in carrying out their duties and responsibilities to the Bank;

Page 11
Conflicts of Interest Policy – Deutsche Bank Group

v. an Employee favours interest of one Unit of the Bank over another Unit of the Bank which is
inconsistent with the best interest of the Bank including in connection with the selection of
Vendors; or

vi. a Conflict of Interest arises in connection with a transaction or arrangement entered into
between the Bank and a material shareholder or between DB Group Entities due to the
close relationship between the parties.

3. Specific examples of Conflicts of Interest (non-exhaustive)

The below is a sample, drawn from the Bank’s Conflicts of Interest Taxonomy, of specific examples
of transactions and activities at the Bank that may give rise to Conflicts of Interest which require
appropriate management, mitigation or prevention:

A Conflict of Interest may arise between the Bank and a Client if the Bank is
involved in allocating a product, service, loans or securities (e.g. loan offering or
syndication, investments, trades, IPOs, etc.) because the Bank may be incentivised
Allocations to allocate or price the transaction in a manner which favours itself or certain
investor Clients (in return for example, for promises of reciprocal business), which
may result in detriment to the Bank’s issuer/seller/borrower Client or other investor
Clients.

A Conflict of Interest may arise between the Bank, Employees, Clients and other
market users where (i) an Employee is managing a risk position held by the Bank
the value or price of which is determined by a Benchmark (such as LIBOR,
WM/Reuters) or a reference price fixing (such as a futures contract
settlement/close), and therefore has a financial interest in the level of the
Benchmarks
Benchmark or fixing rate, because this may lead to the Employee, alone or in
collusion with others, to attempt to manipulate the market or influence
contributions of submitters for their own or the Bank’s benefit and to the detriment
of a Client; or (ii) a Unit of the Bank manages Benchmark risk and also acts as a
calculation agent or submitter for the Benchmark.

A Conflict of Interest arises between the Bank (acting as a Portfolio Manager /

Asset Manager with discretion over a Client’s account), an Employee and a Client
if, instead of fulfilling the Client’s investment goals, the Employee engages to the
Churning
detriment of the Client in “churning” by excessive buying and selling of securities
in the Client’s account, principally to generate commissions for the benefit of the
Bank and the Employee.

A Conflict of Interest arises between the Bank, an Employee and a Client if the
Employee engages to the detriment of a Client in cross selling activities or
Cross-Selling Products
providing multiple service/products to the Client which are not in the best interest
of the Client principally to generate higher fees or revenue on behalf of the Bank.

A Conflict of Interest may arise between the Bank, an Employee and a Client if the
Misuse of Client Bank and/or an Employee is in possession of confidential information or inside
confidential or non-public information relating to a Client, and the Bank, the Employee and/or another Client
information including of the Bank has an interest in the use of that information that is divergent from, and
Inside Information may be detrimental to, the interests of any other Client or other party to whom the
Bank owes an obligation.

A Conflict of Interest may arise between the Bank, an Employee, a Client or a

Vendor if an Employee deals with individuals who are Family Members or Close
Personal Relationships in the course of conducting business for, or on behalf of,
the Bank because the dealings may compromise or otherwise call into question the
Family / Close Personal
Employee’s judgement, ability to act objectively or properly discharge their duties
Relationship
and responsibilities owed to the Bank and/or Clients, or otherwise give rise to the
risk of reputational damage to the Bank, including the risk of, or appearance of,
impropriety how business is awarded to or by the Bank or the Bank having
obtained an improper advantage or treatment.

Page 12
Conflicts of Interest Policy – Deutsche Bank Group

A conflict of interest may arise between the Bank, an Employee, a Client and/or a
third party if the Bank and/or Employees give or receive fees, commissions or other
Inducements monetary and non-monetary benefits that may inappropriately influence the
behaviour of the Bank, Employees, the Client and/or the Client’s employees in a
way that creates a disadvantage for the Bank or its Client.

Opposing side pitches & A Conflict of Interest arises between the Bank and Clients if the Bank is pitching to,
transactions or acts for, opposing sides of the same transaction/situation.

A Conflict of Interest arises between the Bank, an Employee, Clients and other
market users if the content of a Research report or other public statement does not
Research Independence represent the Research analyst's genuinely held beliefs because they are
influenced by the interest of a particular business division of the Bank, the Bank as
a whole, a Client, another third party or the Employee concerned.

a list of issuers involved in pending transactions that have been publicly

Restricted List announced where the Bank has a role and about which the Bank may have, or
appear to have, non-public price sensitive information

A Conflict of Interest may arise between the Bank, an Employee and a Client if the
Employee recommends or advises the Client to purchase products or services
developed by the Bank (‘In-house products’), including recommending these ahead
Use of in-house products
of products or services developed by third parties, because the impartiality of the
Bank’s advice or recommendation may be impaired by the desire on the part of the
Employee to generate higher revenues for the Bank.

A Conflict of Interest arises between the Bank, Employees, Clients and other
market participants if the Bank is buying and selling securities on a portfolio
Window dressing (fund immediately at or near the end of the reporting period to create a false appearance
related) at the end of the reporting period, (for example to make the portfolio look more
profitable or otherwise healthier than it has been), creating a false and misleading
impression to the detriment of Clients or other market participants.

Page 13
Conflicts of Interest Policy – Deutsche Bank Group

Annex 2: Description of organisational arrangements relating to Conflicts of

Interest

1. Internal Governance Arrangements

1.1. Board Governance

The respective terms of reference for the Management Board and the Supervisory Board set out
the obligations of these bodies relating to the management of Conflicts of Interest. The Supervisory
Board is responsible for decisions with respect to Conflicts of Interest of Supervisory Board
members in accordance with applicable law. In addition, minimum governance requirements for the
Bank’s legal entity boards are set forth in the Board Governance Policy.

1.2. Segregation of Functions and Duties

The Bank structurally segregates its Business Divisions and Infrastructure Functions to allow for
their independence. This segregation is reflected in the composition of the Management Board, its
terms of reference and the Management Board’s Business Allocation Plan. Under the Risk
Management Principles, the Bank also operates an internal control environment underpinned by a
“Three Lines of Defence” framework that requires the independence of control functions, including
Compliance, Risk, and Audit.
Additionally, Business Divisions implement policies and procedures and systems and controls so
that one person or Unit does not execute all phases of a transaction, including applying a “four
eyes” principle to avoid or mitigate the risk of asset or information loss.

1.3. Committee Governance

Each committee of the Bank is required by the Bank’s Committee Governance Policy to have terms
of reference in place. These terms must include the requirement for members of committees to
consider potential Conflicts of Interest when determining the composition of the committee, taking
into account the tasks and responsibilities of that committee. Further, the terms of reference must
require committee members to disclose potential Conflicts of Interest on an ongoing basis to the
chairperson and for the chairperson to take appropriate action to resolve such Conflicts of Interest.

2. Conflicts of Interest Group-wide Minimum Standards Framework

The COI Framework for the oversight and governance of Conflicts of Interest consists of the four
elements set out below.

2.1. Bank Conflicts of Interest Register

The Bank maintains a register that records the types of Conflicts of Interest that have arisen or may
arise in the course of the Bank’s regulated services and activities or otherwise by virtue of the
Bank’s structural or business practices. Where applicable, such Conflicts of Interest are cross-
referenced against the relevant MiFID Business.

2.2. Business Selection and Conflicts Office

The Conflicts Office is a global function that is independent of the Bank’s Business Divisions and
has four primary responsibilities under the COI Framework:
i. oversight of the operation of the Bank’s transactional conflict clearing and business
selection process, as well as other means of transactional conflict resolution;
ii. assisting in the management and resolution of Episodic Conflicts that may arise outside of
the conflict clearing process;

Page 14
Conflicts of Interest Policy – Deutsche Bank Group

iii. general oversight of, and annual reporting to the Management Board on, Conflicts of
Interest oversight and governance activities conducted by Units; and
iv. the creation and maintenance, in conjunction with Compliance, of the Conflicts of Interest
Taxonomy.

2.3. Units Conflicts Oversight and Governance

The COI Framework sets out minimum standards for Conflicts of Interest oversight and governance
in each Unit, including:
i. the operation of an oversight body;
ii. regular reporting to the Unit’s executive committee;
iii. maintenance of a Conflicts of Interest register, mitigation procedures and controls, and
clearly defined escalation processes;
iv. conduct of regular risk assessments;
v. provision of training to Employees of the Unit;
vi. the establishment of appropriate organisational and supervisory arrangements; and, where
applicable,
vii. management of disclosure of Conflicts of Interest to Clients.
In addition, Business Divisions are required to undertake product reviews, new product and
transactional approvals and assessments of suitability and appropriateness as applicable, all of
which are targeted at identifying, escalating and managing Conflicts of Interest.

2.4. Compliance
Compliance, as a 2nd Line of Defense function, is the “Risk Type Controller” for the Conflicts of
Interest Risk Type. In this capacity, Compliance is responsible for the development of related
policies, the testing of controls implemented by Business Divisions and the regular risk assessment
of Conflicts of Interest Risk Type management by the Bank.
Compliance is also responsible for certain aspects of the Bank’s overall conflicts management,
including processes relating to Employee Trading and Outside Business Interests, as well as those
operated by the Compliance Control Room.

Page 15
Conflicts of Interest Policy – Deutsche Bank Group

Annex 3: Description of policies, procedures, systems and controls relating to

Conflicts of Interest
The Bank employs a number of systems, controls, policies and procedures to manage Conflicts of
Interest, including those summarised below.

1. General Policies, Procedures, Systems and Controls

1.1. Information Barriers and the Control Room

In accordance with the Information Barriers Policy, the Bank maintains Information Barriers that are
designed to restrict information flows between different areas of the Bank. These restrictions
enable the Bank and Employees to carry out business on behalf of Clients without being influenced
by other information held within the Bank which may give rise to a Conflict of Interest. For the
avoidance of doubt, and consistent with the Bank’s need-to-know principle, where an Employee is
required by any other policy or procedure of the Bank to share information with other Employees
(including Employees in different group entities or different business lines), the Employee is
required to do so in accordance with such policy or procedure provided that such sharing of
information does not breach this Conflicts of Interest Policy or any related policies and procedures.
The Bank’s Compliance Control Room helps maintain the integrity of these Information Barriers by
identifying non-public information through a watch list, monitoring the flow of this information
within the Bank and, where necessary, restricting activities based on this information through the
Bank’s Restricted List. These measures enable the Bank to identify and manage potential Conflicts
of Interest arising from sales, trading and Research activities in the period before, during and after
investment banking transactions.

1.2. Disclosure and Client Consent

In certain circumstances, the Bank may determine that its arrangements to prevent or manage
Conflicts of Interest may not be sufficient to protect a Client’s interest from material damage and
the Client must be made aware of this. Alternatively, the Bank may decide in particular
circumstances that a Client should be made aware of the potential for a Conflict of Interest and the
arrangements that will be put place to manage the conflict. Where permissible under Rules and
appropriate, disclosure to an affected Client may be made to inform the Client of the arrangements
and/or to specifically seek Client consent to act.
Where the Bank is conducting MiFID Business, disclosure of a Conflict of Interest to a Client as the
sole means of managing the Conflict of Interest is not permitted except as a measure of last resort.
Such disclosure:
i. must be made prior to the provision of the relevant MiFID Business in a durable medium
and in sufficient detail to enable the Client to make an informed decision as to whether to
accept the provision of the relevant service;
ii. must state that it is being provided to the Client because the Bank’s organisational and
administrative arrangements established to prevent or manage that Conflict of Interest are
not sufficient to ensure, with reasonable confidence, that the risk of damage to the interests
of the Client will be prevented;
iii. should take into consideration the nature of the Client and include a specific description of
the Conflict of Interest that has arisen in connection with the proposed service; and
iv. must include an explanation as to the general nature and source of the Conflict of Interest,
the risks to the Client that arise as a result of the Conflict of Interest and a description of the
steps undertaken to mitigate these risks.

Page 16
Conflicts of Interest Policy – Deutsche Bank Group

1.3. Escalation
The Bank operates internal escalation processes for Conflicts of Interest, with each Unit having the
responsibility of defining and documenting their respective processes under the COI Framework.
The escalation processes are required to enable the Conflict of Interest to be escalated on a timely
basis and considered at an appropriate level of seniority and by the correct stakeholders to arrive at
the most appropriate resolution.

1.4. Whistleblowing
The Bank provides appropriate channels through the Raising Concerns (including Whistleblowing)
Policy for the reporting/whistleblowing of Conflicts of Interest within the Bank where an Employee
considers this to be the appropriate channel to draw the matter to the attention of the Bank.

2. Policies, Procedures, Systems and Controls relating to specific activities

2.1. Client Order Handling

A Conflict of Interest may arise where an Employee receives, transmits, executes or otherwise
handles a Client order. The Bank has policies in place to manage such Conflicts of Interest and
thereby protect Client’s interests, requiring Employees to act honestly, fairly and professionally in
accordance with the best interests of a Client and prohibiting improper conduct by the Bank’s
traders, such as front-running Client orders.

2.2. Benchmarks
A Conflict of Interest may arise where the Bank and its Employees engage in Benchmark activities.
In accordance with the Benchmark Policy, the Bank maintains procedures to be followed in order to
manage these Conflicts of Interest, including inter alia:
i. requirements relating to the remuneration of Employees involved in Benchmark submission;
ii. procedures and training to prevent or control information flows involving Employees
engaged in Benchmark activities; and
iii. a specific escalation and resolution mechanism where material Conflicts of Interest are
identified.

2.3. Research Independence

A Conflict of Interest may arise where the content of Research reports or other public statements
by a Research analyst do not represent the analyst’s genuinely held beliefs because they have been
influenced by the interests of a particular Business Division of the Bank. In order to manage such
Conflicts of Interest, the Research Policies and Procedures Manual - Global is designed to promote
and safeguard the integrity and independence of Research. No one may place inappropriate
pressure on a Research analyst with respect to the content or timing of a Research report or a
public statement made by that analyst. The supervisory structure, reporting lines and compensation
criteria for Research and Research analysts are designed to maintain the independence of
Research from other areas of the Bank.

2.4. Underwriting and Placing

A Conflict of Interest may arise between an issuer Client, investor Clients and the Bank in the
context of the Bank’s underwriting and placing activities. The Bank has in place policies, procedures
and arrangements so that the syndication process, including book-building, allocations and pricing,
is conducted in accordance with the issuer Clients’ interests. The Bank is prohibited from putting its
own interest, or the interest of an investor Client, ahead of the issuer Client, or inappropriately
favouring one investor Client over another.

Page 17
Conflicts of Interest Policy – Deutsche Bank Group

2.5. Inducements
A Conflict of Interest may arise where the payment or receipt of an Inducement would create an
incentive for the Bank to act in a way other than in the best interests of its Client. The Bank has
established policies, procedures and controls with regard to the payment and receipt of
Inducements in order to assess their appropriateness and manage any Conflict of Interest that may
arise.

2.6. Remuneration Practices

A Conflict of Interest may arise where the Bank’s remuneration practice could incentivise an
Employee to act contrary to their responsibilities, regulatory requirements or the Bank’s Code of
Conduct. Under the Compensation and Benefits Policy - Deutsche Bank Group, the Bank has a
compensation framework in place to align compensation practices to avoid such an incentive.
The Bank has also implemented a supplementary Compensation Policy for Investment, Banking
and Credit Services which specifically addresses remuneration in connection with the provision of
investment services and ancillary services under MiFID. The purpose of this policy is to avoid Client
interests being adversely affected by the Bank’s incentive and remuneration practices.

2.7. Outside Business Interests

A Conflict of Interest may arise between an Employee’s Outside Business Interests and the
interests of the Bank and its Clients. The Outside Business Interests Policy - Deutsche Bank Group
imposes disclosure and approval requirements, enabling the identification, management and,
where necessary, prohibition of Outside Business Interests that may give rise to Conflicts of
Interest. An electronic register of Outside Business Interests is maintained by the Bank, reviewed
periodically and utilised for conflicts management purposes.

2.8. Employee Trading

A Conflict of Interest may arise between an Employee and the Bank or its Clients by virtue of
Employee Trading. The Personal Account Dealing Policy - Deutsche Bank Group requires
disclosure and approval for personal trading accounts and pre-clearance for specific trading
activity. The approval or rejection of an Employee Trading request is based on consideration of the
Bank’s group-wide activities and engagement with its Clients in order to identify and thereby
manage or avoid any Conflicts of Interest.

2.9. Gifts and Entertainment

A Conflict of Interest may arise where an Employee receives or offers a gift or entertainment that
constitutes an inappropriate incentive for an Employee, Third Party Representative, Client or
Vendor to act in a certain way. The Gifts, Entertainment and Business Events Policy - Deutsche
Bank Group – Deutsche Bank Group does not permit the offering or acceptance of gifts or
entertainment by an Employee unless it is reasonable, proportionate and for a legitimate business
purpose. Where applicable, Employees must obtain pre-approval for gifts and entertainment and
approval will depend, among other criteria, on whether it may give rise to a Conflict of Interest.

2.10. Vendors and Third Party Representatives

A Conflict of Interest may arise in the Bank’s interaction with Vendors and Third Party
Representatives where, for example, an Employee involved in the procurement or hiring process
has a close relationship with a particular Vendor or Third Party Representative. The Bank has
a Procurement Policy - Deutsche Bank Group - and operates multiple systems, controls, policies
and procedures to manage these interactions, including due diligence requirements, contractual
arrangements and an obligation on Employees to disclose matters that might give rise to a Conflict
of Interest. In addition, where a Vendor is also an actual or potential Client of the Bank, the Bank
seeks to manage these relationships independently and on an arm’s length basis under rules of
Page 18
Conflicts of Interest Policy – Deutsche Bank Group

engagement established between the Bank, Vendors and Clients in order to manage any Conflicts
of Interest.

Page 19