INTRODUCTION

This document is intended to give a thorough understanding of the process by which Blue Suisse Limited (the “Company”) categorises its clients, in accordance with the Markets in Financial Instruments Directive (“MiFID”) and the Investment Services Act and applicable investment services rules (the “Law”). If any of the following text is unclear, you are strongly encouraged to refer to any one of our customer agents.

MiFID requires investment firms to be authorised and to comply with various regulatory requirements, including how business is conducted. One of the cornerstones of MiFID is that investors have different levels of knowledge, skill and expertise. Therefore, the regulatory requirements should reflect this, through the use of categories of client.

In terms of MiFID – there are two main categories of client: Retail and Professional. A third category - Eligible Counterparty applies only to a limited number of businesses. MiFID attaches different regulatory protections to each of these categories. Those falling within the retail category—the less experienced, knowledgeable and sophisticated investors—will be afforded a higher level of protection than that afforded to investors in the professional or eligible counterparty category.

1. INTERPRETATION

“Client” shall mean any natural or legal person to whom the Company provides investment and/or ancillary services.

“Professional client” shall mean a client meeting the criteria laid down in paragraph 3.

“Retail client” shall mean a client who is not a Professional Client or an eligible counterparty.

2. CLIENT CATEGORISATION

MiFID affords different levels of regulatory protection are attached to each category as may be summarized below:

• Retail Clients are afforded the most regulatory protection;

• Professional Clients are considered to be more experienced, knowledgeable and sophisticated as well as able to assess their own risk and make their own investment decisions so they are afforded less regulatory protection;
• Eligible Counterparties are investment firms,

credit institutions, insurance companies, UCITS and their management companies, other regulated financial institutions and in certain cases, other undertakings. They are considered to be the most sophisticated investors or capital market participants.

3. PROFESSIONAL CLIENTS

A Professional Client is a client who possesses the experience, knowledge and expertise to make its own investment decisions and properly assess the risks that it incurs. In order to be considered a Professional Client, the Client must comply with the following criteria:

• Categories of Client who are considered professionals

For the purposes of this Law, the following shall be regarded as professionals in relation to all investment services and activities and financial instruments:

1. Entities which are required to be authorised or regulated to operate in the financial markets. The list below should be understood as including all authorised entities carrying out the characteristic activities of the entities mentioned – entities authorised by a member state under a European Community Directive, entities authorised or regulated by a member state without reference to such Directive, and entities authorised or regulated by a non-Member State:

2. 1. Credit institutions;

3. 2. Investment Firms;

4. 3. Other authorised or regulated financial institutions;

5. 4. Insurance undertakings;

6. 5. Collective investment schemes and management companies of such schemes;

7. 6. Pension funds and management companies of such funds;

8. 7. Commodity and commodity derivatives dealers;

9. 8. Locals;

10. 9. Other institutional investors.

11. Large undertakings meeting two of the following size requirements, on a proportional basis:

12. 10. • balance sheet total at least: 20’000’000 Euro;

1. 11. • net turnover at least: 40’000’000 Euro;

2. 12. • own funds at least: 2’000’000 Euro.

3. National and regional governments, public bodies that manage public debt, central banks, international and supranational institutions such as the World Bank, the International Monetary Fund, the European Central Bank, the European Investment Bank and other similar international organisations.
4. Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitisation of assets or other financial transactions. The entities mentioned above are considered to be professionals.

Any other clients are, by default, Retail Clients

It is the responsibility of the Client, considered to be a Professional Client, to ask for a higher level of protection where it deems it is unable to properly assess or manage the risks involved.

This higher level of protection will be provided when a Client who is considered to be a professional enters into a written agreement with the Company to the effect that it shall not be treated as a professional for the purposes of the applicable conduct of business regime.

• Clients who elect to be treated as professionals

• 1. Identification criteria

Clients other than those mentioned in Part A above, including public sector bodies and private individual investors, may also be allowed to waive some of the protections afforded by the conduct of business rules.

The Company should therefore be allowed to treat any of the above Clients as professionals provided the relevant criteria and procedures mentioned below are fulfilled. These Clients should not, however, be presumed to possess market knowledge and experience comparable to that of the categories listed in Part A above.

A Client who does not fall under any of the categories in Section A above may be also be treated as a professional client upon request. The Company will forward a questionnaire in order to establish whether the client possesses sufficient experience, knowledge and expertise to enable him/her to make his/her own investment decisions and properly assess the risks that such investment incurs. In the course of this assessment two of the following criteria, as a minimum, should be satisfied:

• the Client has carried out transactions, of significant size, on the relevant market at an average frequency of 10 per quarter over the previous four quarters;

• the size of the Client’s financial instrument portfolio, defined as including cash deposits and financial instruments, exceeds 500’000 Euro;

1. • the Client works or has worked in the financial sector for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.

2. Procedure

The Clients defined above may waive the benefit of the detailed rules of conduct only where the following procedure is followed:

• they must state in writing to the Company that they wish to be treated as professional clients;

• the Company must give them a clear written warning of the protections and investor compensation rights they may lose;

• they must state that they are aware of the consequences of losing such protections.

Notwithstanding the aforesaid, the Company may at its unfettered discretion request additional information to assess the statement and understanding of client. The final decision whether or not to accept a request by the Client to be treated as professional, shall lie with the Company.

Professional clients are responsible for keeping the Company informed about any change, which could affect their current categorisation. Should the Company become aware however that the Client no longer fulfils the initial conditions, which made him eligible for a professional treatment, the Company must take appropriate action.

4. ELIGIBLE COUNTERPARTIES

Eligible counterparties are any of the following entities to which a credit institution or an investment firm pro-vides the services of reception and transmission of or-ders on behalf of clients and/or execution of such orders and/or dealing on own account:

1. Investment Firms or other investment firms;

2. Credit institutions;

3. Insurance companies;

4. UCITS and UCITS management companies;

5. Pension funds and their management companies;

6. Other financial institutions authorized by a Member State or regulated under Community legislation or the national law of a Member State;

7. Undertakings exempted from the application of the Law in accordance with MIFID in terms of Article 2(1)(k) and (l) thereof (relating to those undertakings whose main or exclusive business relates to dealing on own account activities);

8. National governments and their corresponding offices, including public bodies that deal with public debt;

9. Central banks and supranational institutions.