Applicable Legal Framework

The Company’s activity is primarily governed by:

• Law no. 236/2018 on insurance distribution
• S.F. Norm no. 22/2021 on insurance distribution
• S.F. Norm no. 23/2021 on the professional training of persons involved in insurance distribution
• Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector (SFDR)
• Commission Delegated Regulation (EU) 2022/1288
• Regulation (EU) 2016/679 (General Data Protection Regulation – GDPR)
• Law no. 361/2022 on the protection of whistleblowers in the public interest

The Company conducts its activity in accordance with these regulations, as well as with any related applicable legislation. Kunden Broker’s success and reputation depend both on the quality of the products and services provided to our customers, as well as on the way we conduct business. Through the continuous increase of performance, the establishment of higher standards and a professional and ethical behaviour, we translate this desire into success. In accordance with the stipulations given by the Financial Supervisory Authority (ASF) and in line with international law, companies are required to create a compliance function. Compliance is a set of rules, regulations and guidelines, which are a permanent task for institutions or companies and are implemented by a specialized department, under the supervision of a designated Compliance Officer. The compliance department has five responsibilities: identification, prevention, monitoring / detection, resolution, and consulting. The Compliance Officer identifies the risks a company faces and recommends appropriate corrective action; develops and implements controls to protect the company from these risks; monitors compliance and reports on the effectiveness of controls in managing the company’s risk exposure. The department also resolves compliance issues as they arise and provides recommendations on rules and control.

The Kunden Broker Compliance and Ethics Guide emphasizes a common vision of standards and practices for our business. The principles presented in this document guide each of us in our daily work. In accordance with the legislation in force, the Compliance and Ethics Guide summarizes a set of detailed rules, regulations, and procedures, which govern the way in which the company and its staff carry out their professional activity. This set of guidelines and policies provides assurance that all staff and shareholders have a common vision of ethical standards and operate in accordance with those standards. The guide sets the minimum standards that must be respected by all employees and collaborators.

Compliance policy

According to the structure of the compliance management system, compliance risks are identified and evaluated and methods for identifying and resolving non-compliant cases are established. Compliance risk represents the risk of affecting/ damaging the company’s integrity and reputation, by non-compliance with laws, regulations, internal procedures and ethical standards, in the course of the daily professional activity and the behaviour of each individual, applicable to staff working for the company Kunden Broker.

Internal anti-corruption and anti-fraud policy

Violation by employees, collaborators or partners of existing legislation, internal procedures, regulations, circulars, and anti-fraud policies adopted by the company may lead to adverse financial penalties. Employee accountability is an integral part of our business model. Our behaviour and attitude dictate how we are perceived by customers and suppliers both at an individual and at company levels. Kunden Broker is committed to comply with national and international law in terms of combating corruption. The rules and principles mentioned in our legislative framework are valid for everyone: employees, partners, collaborators, suppliers, legal representatives, or people who work for the company. Therefore, Kunden Broker Companie de Brokeraj S.R.L. shows zero tolerance for any act of corruption.

Anti-money laundering procedure

Our company has drawn up an internal procedure to combat money laundering and terrorism financing that is in accordance with the provisions of Law no. 129/2019 on preventing and combating money laundering and terrorism financing, as well as amending and supplementing some normative acts and with Regulation no. 13/2019 on the establishment of measures to prevent and combat money laundering and terrorism financing through the financial sectors supervised by the Financial Supervision Authority. When assessing and managing the risk, the nature of Kunden Broker’s activities were considered, namely insurance distribution – activity materialized in the intermediation of insurance products from collaborating insurance companies – and marketing activity of the private pension fund – materialized in the intermediation of the fund’s private pensions. Considering that in the case of life insurances and in the acts of accession to the private pension fund, no receipts and/ or direct payments are made from/ to customers, these being made directly to/ from insurers, the company presents a reduced risk for money laundering and financing terrorism. Measures have also been taken to ensure that the risk management control systems and procedures, especially those related to the application of the correct level of customer awareness, are effective and proportional.

GDPR security policies and procedures

We have drawn up special policies and we have adopted GDPR security procedures in accordance with the provisions of EU Regulation no. 679/2016, regarding the protection of individuals in the context of the processing of personal data and the free movement of such data. The procedure describes the conditions and the manner of carrying out the activity regarding the security of personal data processing. The procedure applies both within the Company Kunden Broker Companie de Brokeraj S.R.L., hereinafter referred to as “Operator”, and by the natural and/ or legal persons empowered by the “Operator” to process personal data on its behalf.

Procedure for receiving and resolving petitions

Kunden Broker has drawn up the internal procedure establishing the rules and procedures for the registration, administration and storage of petitions, in accordance with the provisions of the Norm of the Financial Supervision Authority no. 18/2017 on the procedure about resolving petitions regarding the activity of insurance and reinsurance companies and insurance brokers. The purpose of the procedure is to regulate the registration and settlement of notifications, petitions and requests received from customers, according to the legal provisions in force, as well as the period of time in which they will be resolved within the company. The procedure contains the basic principles, rules, and terms regarding the responsible and prompt administration of petitions within the company, its provisions being applicable to Kunden Broker employees, brokerage assistants and collaborators. To properly resolve and within the legal term of the petitions addressed to it, Kunden Broker Companie de Brokeraj S.R.L. holds at both headquarters and territorial headquarters, written procedures for receiving and resolving petitions, approved by the executive management.

Information and communication resources security policy

This security policy defines a set of rules, requirements and instructions applicable at the company level, which are the basis of the security infrastructure and set the limits of an acceptable, legal and efficient behaviour in the use of Information and Communication Resources (ICR). Kunden Broker’s security policy aims to ensure the confidentiality, integrity, and availability of information. Confidentiality means protecting data against unauthorized access. Electronic files created, sent, received or stored using our own ICR system, managed or in the custody and control of Kunden Broker are confidential and can be accessed only by authorized company employees, only under the conditions provided by law and established in the company’ Internal Regulations. The user is personally responsible for ensuring the confidentiality of the data entrusted through the ICR access procedures. Integrity refers to the measures and procedures used to protect data against unauthorized alteration or destruction. Availability refers to ensuring the continuous operation of all ICR components. Different applications need different levels of availability depending on the impact or damage caused by the proper malfunction of the ICR.

Procedure for insurance products intermediation

Due to Kunden Broker’s continuous concern, as a Brokerage Company, with the protection of clients’ rights, the necessary steps in the process of conducting insurance distribution are elaborated, with the aim of avoiding operational and conduct risk. In carrying out the activity of distribution of insurance products and voluntary pensions, the company’s management will permanently monitor the distribution process, to avoid the risk of conduct in the relationship with customers. All those involved in the distribution process (brokerage assistants and individual marketing agents) will act in such a way as to ensure fair and equitable treatment of customers and to avoid incorrect, unfair, fraudulent, or abusive practices.

Advisory Process and Needs Assessment

Within its intermediation activity, the Company carries out, upon request, a structured advisory process aimed at the proper identification of the client’s requirements, needs and objectives, in order to formulate appropriate recommendations. The advisory process primarily involves:

• collecting relevant information from the client, to the extent necessary for identifying an appropriate product;
• clarifying the client’s interests, priorities and objectives pursued through the conclusion of an insurance or private pension product;
• assessing the level of risk acceptance, the desired level of protection and, where applicable, sustainability preferences;
• analysing the products available within the portfolio of the Company’s contractual partners;
• formulating a reasoned recommendation, based on the information provided by the client and on the characteristics of the available products.

The Company’s recommendations are based exclusively on the information communicated by the client and the documents made available by the client. Consequently, the suitability of the recommendation depends directly on the accuracy, completeness and timeliness of the information provided. The Company seeks to ensure that the advisory process is carried out in a clear, fair and transparent manner, so that the client can understand:

• the essential characteristics of the recommended product;
• the associated benefits, limitations and risks;
• the relevant contractual terms and conditions;
• any applicable costs, fees or financial implications.

To the extent provided by law and depending on the nature of the distributed product, the Company may use questionnaires, demands and needs analysis forms, client statements or other internal assessment tools, intended to document the advisory process and to ensure the traceability of the recommendation made. The Company does not guarantee that the recommended product represents the only option available on the market, but only that it has been identified as suitable from among the products available within the Company’s contractual relationships, based on the information provided by the client. The advisory process is documented and, where applicable, archived in accordance with the applicable legal requirements and internal procedures, for the purpose of ensuring compliance, traceability and the protection of the interests of both the client and the Company.

Rules of compliance and ethics

The brokerage assistants/ marketing agents conduct and ethics code

We carry out our activity considering our conduct and ethics code, emphasizing the management of all relationships with fairness, decency, and good intentions. The conduct and ethics code sets clear directions, regarding the way we act and presents details about the professional behaviour that each of us must have. By respecting it, we prove to everyone that we carry out our activity in accordance with the company’s values. Our goals are to achieve operational performance, which places us among the best in the industry, creating lasting value and providing complete and accurate financial information.

Internal Regulations

Social relations with employees are clearly regulated by the compliance and ethical code. Human resource is the most important capital of our company; capable, dedicated, and motivated employees playing a key role in the development and consolidation of the company. Therefore, the company’s management is concerned with the permanent development of employees and ensuring a favourable climate for business, including by promoting the Internal Regulations. Based on the statement regarding the handling of employees’ complaints, they are encouraged to promptly report any practices or actions that they consider to be incompatible with the policies set out in the company’s Compliance and Ethics Guide.

Procedure for the training and development of staff and brokerage assistants

The training and development process of Kunden Broker’s staff as a Brokerage Company is a planned and systematic process that aims to close the gap between the existing and desired level of performance. At the company level, there is a structured training plan for employees/ brokerage assistants/ marketing agents, which will help maintain the requirements of our clients and partners. The staff training is performed by:

• Integration programs for newly hired staff;
• Training and development programs for the existing staff;
• Training and development programs for promoted or reassigned staff (internal recruitment);
• Training programs for brokerage assistants/ marketing agents.

We want to consistently provide efficient services and tailored solutions to our customers, while meeting the highest standard of professional training. The mission of the Kunden Broker team, summarized in the slogan “we care for your future”, is to guide those who choose to become our clients or partners to have more confidence in their future. Thus, we build together with them plans for a secure present and a stable future, from a financial point of view. The brand strategy created by Kunden Broker, on which the company’s entire activity is based, is founded on the idea of always respecting the company’s three values: Professionalism, Orientation towards solutions, and Consistency. We have a long-term commitment to conduct our business in accordance with the applicable laws and regulations and in accordance with the highest ethical principles. This commitment helps maintain our reputation in terms of the honesty, quality and integrity that we demonstrate.

Remuneration and Incentives

The Company is primarily remunerated through intermediation commissions paid by product providers (insurance companies and private pension fund administrators), on the basis of contractual agreements concluded with them. Such remuneration: is included in the cost structure of the distributed products; does not normally generate additional direct costs for the client, unless expressly stated otherwise; may vary depending on the type of product, its characteristics, and the commercial policy of the provider. In certain cases, the Company may also receive other forms of remuneration or benefits, including: additional commissions related to business volume or performance; commercial bonuses granted by providers; non-financial benefits (e.g., participation in training programs, conferences, access to platforms or working tools). Such benefits are granted in accordance with applicable legislation and professional conduct principles, without affecting the Company’s obligation to act honestly, fairly, and in the client’s best interest. The Company implements internal policies and procedures designed to prevent situations in which the remuneration structure could give rise to conflicts of interest or negatively influence the objectivity of recommendations provided to clients. In this regard: remuneration is not structured in a way that encourages the recommendation of one product over another when it is not suitable for the client; persons involved in distribution are subject to compliance and monitoring requirements, including regarding the manner of presenting and recommending products; internal control mechanisms are implemented to verify compliance with the principle of suitability and the client’s best interest. Where the nature or amount of remuneration could give rise to a potential conflict of interest, the Company takes the necessary measures to manage it and, where applicable, will inform the client prior to the provision of the service.

Conflict of Interest Policy

The Company applies appropriate internal policies and procedures to identify, prevent, manage, and, where applicable, disclose conflicts of interest that may arise in the course of its distribution activity. In this respect, the Company implements organizational and administrative measures including, but not limited to: identifying situations where the interests of the Company, persons involved in distribution, or contractual partners may conflict with the client’s interests; periodic assessment of conflict of interest risks, including with regard to remuneration structures, commercial relationships, and distribution practices; functional separation, where appropriate, of duties that may generate conflicts of interest; periodic training of staff and brokerage assistants regarding conduct obligations and conflict management; monitoring of the activity of persons involved in distribution, including through internal control and compliance mechanisms; implementation of internal procedures for reporting and documenting conflict of interest situations. The Company aims to prevent conflicts of interest from the very stage of activity organization, so that they do not affect the quality of services provided and the client’s interest. Where a conflict of interest cannot be avoided through implemented measures, the Company shall:

• assess its nature and potential impact on the client;
• take measures to mitigate adverse effects;
• inform the client in a clear, complete, and timely manner prior to the provision of the service, so that the client may make an informed decision.

The information provided to the client shall include a general description of the conflict of interest, its source, and the measures taken to mitigate associated risks. All identified conflict of interest situations are documented and archived to ensure traceability and to allow verification by competent authorities, including the Financial Supervisory Authority (A.S.F.).

Whistleblowers (Integrity Reporting)

In accordance with Directive (EU) 2019/1937 and Law no. 361/2022 on the protection of persons reporting breaches of Union law, the Company ensures an appropriate internal framework for reporting, investigating, and resolving breaches of the law, promoting an organizational culture based on legality, integrity, transparency, and accountability. The Company encourages the good-faith reporting of any illegal, unethical, or non-compliant acts, without such reports being considered denunciations, but rather legitimate contributions to compliance with legal provisions and professional standards. Reports may be submitted, under the law, by:

• employees of the Company;
• former employees;
• collaborators and brokerage assistants;
• contractual partners;
• suppliers;
• other persons who have obtained information in a professional context.

Types of breaches

The following may be subject to reporting, by way of example:

• economic or financial offences;
• corruption (bribery, influence peddling);
• fraud, forgery, or use of forged documents;
• money laundering or terrorist financing;
• conflicts of interest;
• breaches of applicable legislation (including in insurance and private pensions);
• serious disciplinary misconduct or breaches of ethical and professional rules;
• any actions or omissions contrary to the purpose or spirit of applicable legislation.

Reporting channels

The Company has established a dedicated internal channel for submitting reports, separate from ordinary operational channels. Reports may be submitted:

• by e-mail to: avertizor@kundenbroker.ro;
• in writing, by delivery to the Company’s registered office;
• in person at the Company’s premises, with registration of the report.

Reports may be submitted with or without identification of the reporting person, in accordance with the law.

Reporting procedure

The Company ensures a structured internal process for handling reports, including:

• registration of the report in an internal register;
• acknowledgment of receipt within the legal deadline;
• preliminary admissibility assessment;
• objective and impartial investigation of the reported facts;
• adoption of appropriate measures, if a breach is confirmed;
• communication of a response to the whistleblower, within legal limits.

Protection of whistleblowers

The Company guarantees:

• confidentiality of the whistleblower’s identity and any third parties mentioned in the report;
• protection against any form of retaliation (dismissal, sanctioning, discrimination, etc.);
• good-faith handling of reports in accordance with applicable legislation;
• restricted access to information, limited only to authorized persons.

Confidentiality and data protection

Reports and related personal data are treated confidentially and in compliance with GDPR provisions. Data are processed exclusively for the purpose of handling the report and are retained only for the period necessary to fulfil this purpose, in accordance with legal obligations.

External reporting

In accordance with applicable legislation, whistleblowers may also use external reporting channels, including competent authorities, where they consider that internal reporting is not appropriate or effective.

Abusive reporting

Reports made in bad faith or abusively may result in disciplinary, administrative, or criminal liability, in accordance with the law.