GTJAI Anti-bribery and Corruption Policy

Guotai Junan International Holdings Limited (the “Company”, together with its subsidiaries referred to as the “Group”) is committed to the highest standards of business ethics conduct and has zero tolerance for bribery and corruption practices. All agents including but not limited to directors, employees, senior management and licensed individuals and account executives must be familiar with the relevant bribery and corruption laws, the Group’s Anti-bribery and Corruption policy and any related guidance, as well as any other similar laws and regulations in other countries/jurisdictions when conducting business there or where appropriate.

Here is the summary of the Policy:

1.    Definitions: The Policy provides definitions for key terms such as Agent, Business Partner, Bribery, Corruption, Advantage, Entertainment, and Offers, Solicits, and Accepts an Advantage.

2.    Purpose and Scope: The Policy is designed to uphold the company's reputation and integrity by prohibiting bribery and corruption, which sets the ‘Tone from the Top’ message from senior management stance against all bribery and corruption practices.

The Group believes that conducting business with integrity is critical to its success as a sustainable and responsible business group. Bribery or corruption damages a company’s reputation and undermines its relationship with its regulatory authority, customers, business partners and competitors. It may lead to criminal prosecution or regulatory action against a company or its employees, resulting in the imposition of criminal or civil penalties, including fines and imprisonment, and could damage a company's reputation and business.

We regard honesty, integrity and fair play as our core values that must be upheld by all agent. Under the law, any agent who, without the permission of his/her employer or principal, solicits or accepts an advantage as a reward or inducement for doing any act or showing favour in relation to the any business or affairs of the Group, whether in Hong Kong or elsewhere, commits an offence. The agent offering the advantage also commits an offence unless exempted otherwise.

It applies to all agents of the company and extends to all departments. The company also expects its business partners to comply with this Policy.

3.    Governance Framework: The Policy outlines the roles of different groups within the company, including the Risk Management Committee, Financial Crime Compliance Working Group, Senior Management, Financial Crime Compliance Team and Internal Audit Department, in overseeing and managing anti-bribery and corruption risks.

4.    Areas of Concern: The Policy identifies potential risks such as conflicts of interest, acceptance of advantages, offer of advantages, acceptance and offer of referral fees, consultancy fees, or rebates, and entertainment, and provides guidance on how to handle these situations.

4.1    Conflict of Interest
All agents should uphold the highest standards of professional conduct including openness, fairness, honesty and integrity. They should:

•       Act in a reliable and trustworthy manner

•       Be alert to the ways in which their work and behaviour might affect others and respect the privacy, rights and reputations of other parties and individuals

•       Respect confidentiality

•       Declare conflicts of interest

•       Avoid deception and take steps to prevent or report corrupt practices or professional misconduct

•       Reject bribery and improper influence

All agents are required to declare any personal interest he/she or persons connected to where may have in any significant matter(s) he/she is involved in. Any person or organization who can make choices on someone else’s behalf should avoid conflicts of interest to uphold their ethical credibility and fulfill their legal responsibilities.

4.2    Acceptance of Advantage
Each agent should decline advantages offered in connection with works if the acceptance of advantages could affect the agent’s objectivity or induce the agent to act against the interests of the Group or its clients, lead to bias, the perception or allegation of impropriety or interference with the agent’s independence.

In determining whether or not the acceptance of a particular advantage or personal benefit might be construed as improperly influencing the discharge of duties, agents should seek for advice from local Legal & Compliance Department or equivalent department. Cash and cash equivalents (store coupons, etc.) should never be accepted or retained and should be declined. If it is not practicable or not possible to decline, agent should immediately notify local Legal & Compliance Department or equivalent department

If agent is carrying out the Group’s business, he/she should also comply with any standards or restrictions on the acceptance or offering of advantages that may be set by the client, his/her regulatory authority, or applicable to the jurisdiction where he/she situates.

Once it has been proved that the agent accepted any advantage, believing or suspecting or having grounds to believe or suspect that the advantage was given as an inducement to or reward for or otherwise on account of his/her doing or forbearing to do, having done or forborne to do any acts, it shall be no defence or excuse that:

(a) The offeree did not actually have the power, right or opportunity so to do or forbear;

(b) The offeree accepted the advantage without intending so to do or forbear;

(c) The offeree did not in fact so do or forbear; or

(d) Any such advantage is customary in any profession, trade, vocation or calling.

4.3    Offer of Advantage
Under no circumstances should an agent offers advantages to any individual or company for the purpose of influencing such individual or company in directing business or clients to the Group or other advantage.

When having business dealings with public servant, namely, principal official, employees, office holder, member of any council, board, commission, committee or other body of the public bodies, agent should also refrain from offering them any advantages.

Once it is proved by evidence that the agent offered any advantage to any person as an inducement to or reward for or otherwise on account of that other person’s doing or forbearing to do, or having done or forborne to do, any act in relation to the Group businesses or affairs, it shall be no defence or excuse that such other person had no such power, right or opportunity to do so.

4.4    Acceptance and Offer of Referral Fee, Consultancy Fee or Rebate
Subsidiary must be properly licensed or authorized by the relevant regulatory authority to conduct regulated business when accepting any referral fee, consultancy fee or rebate for introducing existing or potential clients or business to other companies.

Any person or company who introduces business or clients to the Group’s licensed corporations and demands or solicit for referral fee, consultancy fee or rebate in return must be licensed or authorized by relevant regulatory authority if license or authorization is required in such jurisdiction, where appropriate while the Group’s subsidiary must be licensed to conduct the relevant regulated business.

The acceptance and offer of referral fee, consultancy fee or rebate must also comply with all legal and regulatory requirements and shall be arranged with relevant agreement. If it is not permitted in such jurisdiction, the Group should not enter into any referral arrangement with such person/company.

4.5    Entertainment
Entertainment shall be limited to proper entertainment in a proper establishment where the entertainment is provided. Although entertainment is an acceptable form of business and social behaviour, all agents should avoid providing and accepting lavish or frequent entertainment offered to and from companies or its agent with whom the Group has business dealings (e.g. counterparties, bankers, clients, listing applicants, Business partners etc.) to avoid placing himself/herself in a position of actual or potential conflict of interests and feeling obliged to return any favour.

4.6    Red flags
A “red flag” is a fact, event, or set of circumstances, or other information that may indicate a potential legal and compliance concern for illegal or unethical business conduct, particularly with regard to corrupt practices and non-compliance with anti-corruption laws. If any red flags are identified during the Group business activities, agents should report to local Legal & Compliance Department or equivalent department. The following is a non-exhaustive list of red flags:

• Flawed background or reputation

• Requests for Kickbacks

• Offer a sexual favors

• Overpaying for purchases

• Transaction or Intermediary suggested by a Public Official

• Close business, personal or family relationship with a Public Official who has discretionary authority

• Party to a transaction or contract makes unreasonable/unsupported objections

• Use of non-transparent corporate structure

• Requires payment of a commission

• Requests for unusual contract terms

• Requests for payment in cash, advance payments, payment to an individual or entity that is not the contracting individual/entity.

• Requests for payment into a country that is not the contracting individual/entity's principal place of business or the country where the services are performed

• Adjustment of remuneration demand during the course of the engagement

• Vague or unsupported book keeping

• Heavy reliance on cash/cryptocurrency

• Complaint from bidders, agents, business partners and/or other parties

5.    Whistleblowing: The Policy encourages agents and external parties to report any actual or suspected bribery or corruption incidents. The whistleblower's identity is protected, and retaliation is prohibited.

6.    Risk Assessment: Regular risk assessments are to be initiated by the Financial Crime Compliance Team, with mitigating controls implemented for identified risks.

7.    Agent Training and Undertaking: The Policy stipulates that new and existing agents must undergo training on anti-bribery and corruption, and to submit annual declaration that confirming the compliance of all requirements and standards of the Policy.

8.    Business Partners: Business partners are required to have relevant policy, program or control in relation to Anti-Bribery and Corruption that is in full compliance with all applicable laws and regulations. Due diligence checks are to be conducted on business partners to assess their suitability and potential risk.

9.    Record Keeping: All agents are required to ensure that all documents submitted to the company accurately represent the facts, events, or business transactions.

10.  Disciplinary Action: The Policy also outlines the potential disciplinary actions for violations, including termination of employment, and the process of reporting corruption/bribery incidents to the relevant authorities.

The Policy applies to all departments of the Group to the fullest extent applicable. All departments of the Group must ensure their own operational manuals, policies and procedures are consistent with the Policy.

Updated in September 2024