A conflict of interest (a “conflict of interest”) arises when Kenjee Capital Inc. (“Kenjee”) or one of its representatives has multiple interests, financial or otherwise, and the exercise of one of these interests could conflict with the obligation to act in the best interest of the client. Such a situation can lead to a risk that the interests of Kenjee or its representatives are not fully aligned with those of the client.
In accordance with National Instrument 31-103 respecting Registration Requirements, Exemptions and Ongoing Registrant Obligations and Companion Policy 31-103, Kenjee has an obligation to identify material conflicts of interest, manage them appropriately, clearly disclose them to the client, and address these conflicts by prioritizing the client’s interest. When a material conflict of interest cannot be adequately managed in the client’s interest, Kenjee must avoid it.
Kenjee provides this information to enable clients to understand the nature of the conflicts of interest likely to arise in the context of the client relationship, their potential impacts, and the measures put in place to mitigate and manage them in accordance with applicable regulatory requirements.
There may be an incentive for us to select a broker or custodian based on the advantages they could provide us rather than based on the quality of services offered to the client.
Impact on the client: You could obtain less favorable execution terms or services.
Management measures: We conduct an annual review of the best execution policies of the brokers and custodians with whom we do business to ensure that the execution of transactions is fair and in accordance with the interests of the clients.
When one Kenjee client sells a security and another Kenjee client buys the same security, we may facilitate a cross trade.
Impact on the client: The interests of one client could be favored over those of another client.
Management measures: Any cross trade must be subject to a review and prior approval by the Chief Compliance Officer (CCO). Such transactions are infrequent.
When an investment opportunity is limited (for example, a high-demand new issue), there may be a risk of favoring one client over another.
Impact on the client: You might not receive a fair share of available investment opportunities.
Management measures: We apply a fair allocation policy, supervised by the compliance function, to ensure that investment opportunities are distributed in a just and equitable manner among eligible clients.
Our representatives are generally compensated based on the capital they raise, which could incentivize them to recommend products too insistently.
Impact on the client: You could be encouraged to invest amounts higher than what is appropriate given your situation.
Management measures: All fee and compensation terms are subject to a review by the compliance function. We monitor accounts to assess the appropriateness of transactions and address any fee structure that exceeds market practices or standards.
Our representatives could be influenced by gifts or benefits offered by third parties.
Impact on the client: The advice provided could be biased in favor of providers offering such benefits.
Management measures: All gifts and benefits must be declared in accordance with our internal policies. Gifts whose value exceeds $100 are prohibited.
Kenjee may distribute securities of issuers that are related or connected to it.
Impact on the client: Kenjee may have a financial interest in recommending these securities.
Management measures: Written information will be provided to you before any investment in a related or connected issuer. Such securities will only be recommended if they are deemed appropriate given your situation and in your best interest.
Some representatives may engage in other professional or business activities.
Impact on the client: There could be confusion as to the capacity in which the representative is acting (on behalf of Kenjee or in another capacity) or a risk of divided loyalties.
Management measures: All outside activities must be subject to prior approval by the Chief Compliance Officer (CCO) and be declared to regulatory authorities when required.
If our representatives borrow funds from clients, lend them funds, or maintain personal business relationships with them, conflicts of interest may arise.
Impact on the client: Such transactions could harm the representative’s professional objectivity or create a power imbalance in the client relationship.
Management measures: Personal financial transactions with clients are prohibited, except with prior written authorization from the Chief Compliance Officer (CCO), in accordance with Kenjee’s internal policies and applicable regulatory requirements.
Our employees may conduct transactions in securities for their own accounts.
Impact on the client: There is a risk that employees use confidential information for personal purposes.
Management measures: We monitor employees’ personal trading accounts and apply strict policies aimed at preventing any inappropriate use of information, in accordance with applicable regulatory requirements.
Errors can occur in the pricing of securities or in the execution and recording of transactions.
Impact on the client: If these errors are not corrected fairly, they could result in prejudice to the client.
Management measures: KENJEE has put in place policies and procedures to identify, correct, and address errors promptly and fairly, in order to avoid any undue advantage for KENJEE or any disadvantage for the client.
KENJEE may enter into referral arrangements with third parties, under which fees or other benefits may be paid or received.
Impact on the client: A client referral could be made because of the associated compensation rather than in the client’s best interest.
Management measures: All referral arrangements are documented and subject to written disclosure to the client, which specifies in particular the nature of the relationship, the fees or benefits involved, and how this arrangement may have an impact on the client.
Representatives may receive different levels of compensation depending on the product distributed (for example, one product may result in higher investment fees).
Impact on the client: Representatives could be incentivized to recommend one product over another because of the associated compensation, rather than based on the appropriateness of the investment for the client.
Management measures: KENJEE reviews all compensation structures and monitors the recommendations made to ensure they remain appropriate for each client.
Kenjee may recommend or use service providers (lawyers, accountants, valuation experts, fund administrators, etc.) with whom it maintains business relationships.
Impact on the client: The provider might not be the most independent or the most advantageous option in terms of costs.
Management measures: KENJEE ensures that service providers are qualified to provide the required services and discloses in writing any referral or fee-sharing arrangement, if applicable, in accordance with applicable regulatory requirements.
Kenjee may have access to material non-public information concerning issuers or clients which, if used inappropriately, could benefit another client or the company.
Impact on the client: Certain decisions could appear biased or inconsistent when information cannot be communicated to the client due to confidentiality obligations.
Management measures: KENJEE has put in place strict confidentiality policies and information barriers to prevent any inappropriate use of information.
Kenjee may simultaneously represent several issuers seeking financing.
Impact on the client: Kenjee’s resources and attention could be prioritized to the benefit of larger issuers or those of a more strategic nature.
Management measures: All mandates are subject to internal supervision to ensure fair treatment of issuers and investors.
Since KENJEE collects investment fees only when the investment is completed, there may be an incentive to minimize or mitigate the scope of unfavorable findings arising from the due diligence process.
Impact on the client: The client could be exposed to investments involving higher risks than those that were disclosed.
Management measures: KENJEE applies rigorous due diligence standards and documents each review process in detail to protect the interests of clients. When appropriate, KENJEE also calls upon qualified external third parties to supplement and strengthen its due diligence work.
You have the right to be informed of the existence of actual or potential conflicts of interest.
We will disclose to you in writing any material conflict of interest before it occurs or at the time it occurs.
We will only proceed with a transaction if the conflict of interest can be managed in your best interest.
When a material conflict of interest cannot be adequately managed in the client’s interest, we will avoid it.
Our policy regarding conflicts of interest is subject to a formal review at least once a year and is updated as necessary to reflect any changes in our business model, regulatory requirements, or industry practices.
If you have questions or concerns regarding conflicts of interest at Kenjee, we invite you to discuss them with your registered representative or to contact our Chief Compliance Officer directly.
Kenjee Capital Inc. | 30 Rue des Sapins, Mercier, QC, J6R 1X9 | compliance@kenjee.ca | (438)-993-7940
