NR Private Market categorises approved investors as either Professional Clients or Elective Professional Clients as follows:
Professional Clients: a client that is either a per se professional client or an elective professional client. A professional client is a client who possesses the experience, knowledge and expertise to make his/her own investment decisions and properly assess the risks that he/she incurs. Categories of clients who are considered to be professionals per se:
1. An entity which is required to be authorised or regulated to operate in financial markets. Examples of entities carrying out the characteristic activities are:
a) Credit institutions,
b) Investment firms,
c) Other authorised or regulated financial institutions,
d) Insurance companies,
e) Collective investment schemes and management companies of such schemes,
f) Pension funds and management companies of such funds,
g) Commodity and commodity derivatives dealers,
h) Locals: firms which provide investment services and/or perform investment activities consisting exclusively in dealing on own account on markets in financial futures or options or other derivatives and on cash markets for the sole purpose of hedging positions on derivatives markets or which deal for the accounts of other members of those markets or make prices for them and which are guaranteed by clearing members of the same markets, where responsibility for ensuring the performance of contracts entered into by such firms is assumed by clearing members of the same markets, and/or,
i) Other institutional services.
2. Large undertaking meeting two of the following size requirements on a company basis:
a) balance sheet total at least EUR 20,000,000; and/or,
b) net turnover at least EUR 40,000,000; and/or,
c) own funds at least EUR 2,000,000.
3. Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitization of assets or other financing transactions.
Elective Professional Clients - NR Private Market may treat a client as an elective professional client if the following process is followed. Elective Professional Client – Clients which meet certain criteria may request to be opted-up to be treated as an Elective Professional client (which includes any individual investor who is a natural person). To elect to be treated as a professional client, an Investor must be subject to an adequate evidenced based assessment taking into account; the clients experience and knowledge in relation to the specific type of investment opportunity (related instruments) and the risks involved. The Client receiving loss of protection notification in relation to the consequences of the elective professional categorisation and a separate confirmation from the client accepting the categorisation. In the case of any business to which MIFID relates, information relating to frequency of transactions and the size of the client’s investable portfolio will also be required to be disclosed and assessed. Please see the full rules as contained in the FCA handbook COBS 3.5.3R.
Promotions in relation to non-quoted securities are referred to as “non-readily realisable securities” (NRRS), these opportunities are made available to Certified and self-certified sophisticated investors and certified High Net Worth Investors.
Self-Certified Sophisticated Investor - The Client is a self-certified sophisticated investor because at least one of the following criteria are satisfied:
1. They are a member of a network or syndicate of business angels and have been so for at least the last six months prior; and/or,
2. They have made more than one investment in an unlisted company, including via NR Private Market, in the two years prior; and/or,
3. They are working, or have worked in the two years prior, in a professional capacity in the private equity sector, or in the provision of finance for small and medium enterprises; and/or,
4. They are currently, or have been in the two years prior, a director of a company with an annual turnover of at least £1 million.
Certified High Net Worth Investor - Is an investor to which the following criteria applies, and whom has signed a certified statement;
1. Throughout the financial year immediately preceding the date signed, an annual income value of £100,000 or more. Annual income for these purposes does not include money withdrawn from my pension savings (except where the withdrawals are used directly for income in retirement).
2. held, throughout the financial year immediately preceding the date below, net assets to the value of £250,000 or more. Net assets for these purposes do not include:
(a) the property which is my primary residence or any money raised through a loan secured on that property; or
(b) any rights of mine under a qualifying contract of insurance; or
(c) any benefits (in the form of pensions or otherwise) which are payable on the termination of my service or on my death or retirement and to which I am (or my dependants are), or may be, entitled; or
(d) any withdrawals from my pension savings (except where the withdrawals are used directly for income in retirement).
Certified Sophisticated Investors -
1. Will be in receipt of a signed certificate dated within the last 36 months by a firm confirming the individual has been assessed by that firm as sufficiently knowledgeable to understand the risks associated with engaging in investment activity in non-mainstream pooled investments and NRRS; and
2. who has signed, within the period of twelve months ending with the day on which the communication is made, a statement in the following terms:
“SOPHISTICATED INVESTOR STATEMENT
I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified sophisticated investors and I declare that I qualify as such.
I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me to seek advice from an authorised person who specialises in advising on non-mainstream pooled investments.
An investor is deemed to be 'approved' once having completed the KYC/AML on-boarding process on the NR Private Market platform - further details can be found on this process in the Terms & Conditions.
