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MARTIN CURRIE INC
CODE OF ETHICS
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CODE OF ETHICS FOR MARTIN CURRIE INC
1. INTRODUCTION
WHO DOES THE CODE APPLY TO?
Under Rule 17j-1(a) of the Investment Company Act investment advisers to
any registered US investment companies are required to have a Code of
Ethics. The codes apply to what are termed "Access Persons".
Essentially this is anyone who in the course of their employment has
access to information concerning the purchase or sale of securities on
behalf of, or anyone who makes recommendations to an investment
company. In view of the low volume of personal dealing and due to the
similarity with IMRO's rules on staff dealing it has been determined
that all staff of the Martin Currie group (including their Related
Accounts) other than the non-executive directors of Martin Currie
Limited will be subject to this Code.
2. GENERAL PRINCIPLES
This Code of Ethics ("the Code") is based on the principle that
officers, directors and employees of Martin Currie owe a fiduciary
duty to Martin Currie Inc's clients. Accordingly, you must avoid
activities, interests and relations that might interfere or appear to
interfere with making decisions in the best interests of Martin Currie
Inc's clients or otherwise take unfair advantage of your position. The
specific provisions of the Code must be adhered to as well as the general
principles. This code does not attempt to identify all possible conflicts
of interest and literal compliance with the specific procedures will not
shield you from liability for personal trading or other conduct which
violates your fiduciary duties to Martin Currie Inc's clients. In addition
to this code you are subject to the general requirement not to engage in
any practice that would defraud clients. Your are also subject to the IMRO
principles, IMRO's rules on staff dealing and rules on inducements. The
requirements of IMRO are broadly similar to those of the Investment Company
Act, but in the event of there being any conflict the higher standard will
generally prevail. In such circumstances the General Counsel should be
consulted.
At all times you must:
(i) Place the interests of clients first. As a fiduciary, you must
avoid putting your own personal interests ahead of the interests of
Martin Currie Inc's clients. You may not cause a client to take
action, or not to take action, for your personal benefit rather than
the benefit of the client. For example, you would violate this Code by
causing a client to purchase a security you owned for the purpose of
increasing the price of that security. Another example would be if you
invest in a security that may be appropriate for your clients without
first considering that investment for your clients.
(ii) Avoid taking inappropriate advantage of your position. It is
imperative that you avoid any situation that might compromise, or
call into question the exercise of your independent judgement. The
receipt of investment opportunities, perquisites, or gifts of more
than de minimis value from persons seeking business with Martin
Currie
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could call into question the exercise of your independent judgement.
You may not, for example, use the knowledge of client portfolio
transactions to profit by the market effect of those transactions.
(iii) Conduct all personal securities transactions in full
compliance with this Code. While Martin Currie does not object to
personal investment, you must not take any action which could cause
even the appearance of an unfair or improper action. Accordingly, you
must follow the policies set forth in this Code with respect to
trading on your own or any account which, in your personal capacity,
you have some control/influence over; for example,
children/spouses/relatives accounts ("Related Accounts"). Doubtful
situations should be resolved in favour of clients. Any questions
concerning this Code should be addressed to the General Counsel.
Technical compliance with the Code's procedures will not automatically
insulate from scrutiny any trades that indicate an abuse of fiduciary
duties.
3. PERSONAL SECURITIES TRANSACTIONS
(i) ANNUAL DISCLOSURE OF PERSONAL HOLDINGS
In addition to the trade reporting requirements set out
below, you must disclose on the Personal Securities Holdings Form any
securities you or any related person holds such disclosure must be
made within 10 days of the commencement of employment and annually
thereafter as at 31st July. The Form must be returned to the
Compliance Department. The Form does not need to include details of
transactions over which you had no discretion. The
Form must be returned even where you have no securities holdings.
(ii) DEALING BY EMPLOYEES AND ON BEHALF OF RELATED ACCOUNTS
Prior to instructing an order for a securities transaction on
behalf of your own or a Related Account, you must complete, in
writing, a trade authorisation request form and submit the completed
form to the appropriate Authorisation Officer. The appropriate
Authorisation Officer will be the head of the geographic team in whose
geographic area the intended securities transaction would take place
or in their absence the Chief Investment Officer or the Director of
Investment Planning and Process. Trade authorisation request forms for
the head of a geographic team will be pre-authorised by the Chief
Investment Officer or the Director of Investment Planning and Process.
The Authorisation Officer is responsible for reviewing the
completed trade authorisation request form and they will determine
whether or not to authorise the proposed securities transaction. No
approvals will be granted for employee deals where there is a pending
order for a client or where a transaction is currently being
seriously considered or is likely to be, or has been executed within
7 days unless is it is determined by the Authorisation Officer that
such transaction in no way conflicts with the interests of the
Client. This 7 day limit cannot and is not intended to cover
situations which cannot be predicted, for example, the offering of
an unexpected line of stock which was not being contemplated for
purchase prior to that event. The Authorisation Officer will check
that the security is not on the insider list. The
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Authorisation Officer will in considering whether a conflict exists
look at the liquidity of the issue the size of any client deals and
the size of any staff deals. In the case of new issues the
Authorisation Officer will need to ensure that the staff member has
not been allocated shares (in the type of new issues where shares are
pre-allocated) on the basis of their position at Martin Currie and
that their acquiring shares would not reduce the amount of shares
available for clients.
It is unlikely that the firm will be dealing in unquoted securities
for clients but if approval for a transaction in an unquoted company
is sought consideration needs to be given to the likelihood of that
company becoming quoted and if it is likely that in the future the
company may be one that we may invest in on behalf of clients. If
investment staff held securities in unquoted securities they are
precluded from making any investment decision on behalf of the
clients in these securities. In such circumstances any decision
relating to the securities must taken by a disinterested Investment
Director or the Chief Investment Officer. The General Counsel must
be notified when such situations arise.
The authorisation and date and time of the authorisation must
be completed on the trade authorisation request forms. The person
seeking the trade authorisation will take the completed form to the
Private Client Department. No order for a securities transaction for
which authorisation is sought may be placed prior to the receipt of
written authorisation of the transaction showing the date and time of
the authorisation by the relevant Authorisation Officer. VERBAL
APPROVALS ARE NOT PERMITTED. Staff are expected to execute deals as
soon as reasonably practical following the grant of authorisation.
Trade authorisations are valid until the earlier of (1) the close of
business on the day after the authorisation is granted or (2) your
discovery that the information in the trade authorisation request
form is no longer accurate. If the Authorisation Officer becomes
aware of circumstances which would result in him not granting
approval, he should immediately notify the member of staff and the
Private Client Department who should ensure that the trade is not
carried out. Should the trade have been executed by the time the
Authorisation Officer contacts the Private Client Department the
time at which they were notified should be recorded on the trade
authorisation request form. If the securities transaction is placed
but has not been executed within three trading days after the
authorisation is granted (as, for example, in the case of a limit
order), a new authorisation is unnecessary unless the person placing
the original order for the securities transaction amends it.
Unless otherwise indicated on the form, all trades will be
instructed by the Private Client Department. They will then pass the
trade authorisation request form and copy contract notes to the
Compliance Department for inclusion in the central Staff Dealing
Register. Where the trade is to be completed by a third party broking
firm, it is the responsibility of the employee whose trade has been
authorised to ensure that the trade authorisation forms and copies of
the contract notes are sent to the Compliance Department. Compliance
are responsible for updating the list of holdings on the Staff Dealings
Register and for checking that trade authorisations have been given
for all trades executed by staff and Related Persons.
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(iii) DISCRETIONARY ACCOUNT
Employees are permitted to have discretionary accounts with Martin Currie
or independent investment advisory firms. You are permitted to have your
investments managed on a discretionary basis either by Martin Currie
Private Client Limited or another investment advisory firm. In such
circumstances the Compliance Department must be notified of the
existence of such accounts and a record will be maintained in the staff
dealings records of the existence of the account and with which firm
it is maintained. It is not necessary to obtain authorisation for
transactions in discretionary accounts. If in terms of the discretionary
agreement or in practice you participate in the investment decision
making for your own or any Related Account then all trades will require to
be authorised in accordance with the procedures of this code. The Private
Clients Department will therefore not execute any trades for employees'
discretionary accounts or their Related Accounts where the member of
staff has had any involvement in suggesting, recommending or requesting
trades unless a completed Trade Authorisation Form had been received.
(iv) JOINT ACCOUNTS
Investments held jointly with any other person will also be subject to
the authorisation approval requirements.
(v) INVESTMENT CLUBS
Membership of an investment club requires to be approved by the
Compliance Department. It is unlikely that permission to join will be
granted unless all trades are subject to the Company's trade
pre-authorisation requirements.
(vi) TRANSACTIONS EXEMPT FROM TRADE PRE-AUTHORISATION REQUIREMENTS
Certain transactions in an employee or Related Account do not require
approval. These are as follows:-
(a) The Purchase of units in any UK authorised unit trust including any
unit trust managed by Martin Currie Unit Trusts Limited.
(b) Futures or Options contracts on indices.
(c) Government Bonds.
(d) UK securities issued via open public offer, for which a general
approval has been granted. These would generally include issues such
as Government privatisations.
(e) Corporate action transactions, any acquisition of securities
through stock dividends, dividend reinvestments, stock splits,
mergers consolidations or other similar corporate reorganisations or
distributions generally applicable to all holders of the same class
of securities.
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(f) Rights. Any acquisition of securities through the exercise of rights
issued by an issuer pro rota to all holders of a class of its
security to the extent the rights were acquired in the issue.
(g) Martin Currie Investment Trust Regular Savings, ISA or PEP Plans. Any
transaction in investment trusts' savings ISA or PEP plans of trusts
managed by any Martin Currie Group company except that no
transactions or adjustments to regular payments may be made during
closed periods.
There are certain securities transactions in employee and related accounts
that are prohibited.
(a) Inside information - Securities transactions by any person while in
possession of material non-public information regarding the
securities or the issuer of the security.
(b) Market manipulation transactions intended to raise, lower or
maintain the price of any security or to create a false appearance
of active trading.
(c) Others - Any other securities transactions deemed by the relevant
pre-authorization officer to involve a conflict of interest,
possible diversion of a corporate opportunity or the appearance of
impropriety. In some cases, trades may be rejected for a reason that
is confidential. The relevant pre-authorisation officer is not
required to give any explanation for refusing to authorise a
securities transaction.
Review and availability of information provided. All information supplied in
connection with employee or Related Account transactions will be subject to
review by the General Counsel and the Compliance Department and may form part
of compliance reports. All information supplied will be available for
inspection by the Securities & Exchange Commission, IMRO or any other
self-regulatory organisation of which Martin Currie or any of its group
companies is a member and any state securities commissions.
3. FIDUCIARY DUTIES
(a) CONFIDENTIALITY
You may not reveal any information relating to the investment
intentions, activities or portfolios of clients or securities that are
being considered for purchase or sale except to those persons who
need to know that information in order to carry out their duty or
provide advice in relation thereto.
(b) GIFTS
Extraordinary or extravagant gifts are not permissible and must be
declined or returned. Gifts of a de minimus value and customary
business lunches, dinners, entertainment etc at which both you and
the giver are present and promotional items (e.g. pens, mugs,
umbrellas etc) may be accepted.
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If you are in any doubt as to whether or not you may accept a gift
you should consult the General Counsel. All gifts must be recorded
in the gifts book which is held in the Compliance department. Under
no circumstances should you solicit gifts or entertainment. It is
permitted to provide reasonable entertainment to persons associated
with securities or financial organisations or clients provided that
both you and the recipient are present.
(c) UNDUE INFLUENCE
You may not cause or attempt to cause any advisory client to
purchase, sell or hold any security for the purpose of creating any
personal benefit for your, or a Related Account.
If you or a Related Account stand to benefit materially from an
investment decision for an advisory client that you are recommending
or participating in, you must disclose that interest to the General
Counsel. Disclosure should be made prior to the investment being made
and should be documented.
(d) SERVICE AS DIRECTOR ON BOARDS OUTSIDE THE GROUP
Investment Staff are prohibited from acting as a director on the
boards of publicly traded companies absent a prior authorisation from
the General Counsel. Such exemption will only be granted if it is
determined that the service would not be inconsistent with the
interests of Martin Currie Inc's clients.
APRIL 1st 2000
