Precious metals Unallocated gold metal accounts

The General Terms & Conditions for the Opening and Operation of Customer metal accounts

1. General Provisions

1.1. The General Terms & Conditions for the Opening and Operation of Customer metal accounts (General Terms & Conditions) set forth herein regulate metal account transactions between HSBC Bank Armenia cjsc (hereinafter the Bank) and an individual (including a sole entrepreneur) or a legal entity signing the metal account opening form (hereinafter the Customer) –hereinafter also jointly referred as the Parties.

1.2. Signature of the Customer under the metal account opening form shall constitute an acceptance of these General Terms and Conditions as may be amended from time to time by the Bank by duly notifying the Customer in the manner stipulated herein.

1.3. The below mentioned concepts in these General Terms & Conditions shall have the following meaning:

Metal account - Account opened by the Bank in the name of the Customer for the purpose of recording the unallocated gold purchased by the Customer and/or transferred to the Customer, as well as recording transactions with unallocated gold.

Unallocated gold or funds available on metal account – the gold of respective weight, reflected in troy ounces of 999.5 purity recorded on Customer metal account, which is backed by physical gold maintained in London (loco London).

1.4. The Bank shall provide the following services to the Customer with respect to metal accounts:

1.4.1. Opening of metal account for the purpose of recording the unallocated gold of the Customer and conducting transactions by unallocated gold,

1.4.2. Sale of unallocated gold to the Customer and crediting the unallocated gold purchased by the Customer to the Customer metal account,

1.4.3. Purchase of unallocated gold from the Customer and debiting the unallocated gold sold by the Customer to the Bank from the Customer metal account,

1.4.4. Crediting the unallocated gold transferred by the Customer/third parties from metal account maintained by the Bank/other banks to the Customer’s metal account,

1.4.5. Transfers of unallocated gold from Customer’s metal account to the other customers’ metal accounts maintained by the Bank or to Customer/other persons’ metal accounts maintained by other banks.

1.5. The Bank is entitled to refuse acceptance of documents presented by the Customer for conducting any transaction if the form of such documents (and also the content) differs from the one approved by the Bank.

1.6. The Customer authorizes the Bank to use and process his/her data for the purpose of rendering services. The Bank shall be entitled to use the Customer’s electronic mail address, mobile phone number and other communication details for the purpose of sending to the Customer informative and advertising materials related to the services rendered by the Bank. The Customer hereby agrees, that for the purpose of processing the Customer’s data the Bank may use the services of HSBC Group member or other companies and shall be entitled to transfer to the latters such data. The Customer’s data shall be protected in accordance with privacy and security procedures of HSBC Group irrespective of whether such data is processed in or outside the territory of the Republic of Armenia and may be used only according to the instructions of the Bank. The Bank shall be liable for any losses incurred by the Customer if such losses result from negligence/breach of data protection privacy and security standards by these companies.

1.7. The Customer authorizes the Bank without prior notice to the Customer and at its sole discretion to provide his/her data to the companies cooperating with the Bank for the purpose of offering services to the Customers or improving the services rendered to the Customers.

1.8. The Bank reserves the right to make any inquiry on the source of any funds credited to the metal account by/in the name of the Customer. The Bank shall be entitled to block the questioned funds and/or suspend the use and/or disposal and/or possession of funds during such time until presentation of sufficient evidence. The Customer agrees to indemnify the Bank against any losses and claims in connection with the above. The Customer acknowledges and agrees that the Bank is obliged to comply with the requirements of the laws and other legal acts, as well as those of law-enforcement bodies which refer to the prevention of money laundering and terrorism financing. Neither the Bank, nor any other company acting as a partner of the Bank, is liable for any direct or indirect loss incurred by the Customer if such loss resulted fully or partially from fulfillment by the Bank of the requirements related to combating money laundering and terrorism financing.

1.9. The Bank shall not be held liable for any loss, damage of the Customer or delay resulting from any actions by state bodies or from force majeure circumstances, including equipment default or any interruption of electricity supply.

1.10. Any failure or delay by the Bank in exercising protection of its interests in its relations with the Customers may not be viewed as a waiver thereof. The rights stipulated hereunder are cumulative and not exclusive of any other rights provided by the law.

1.11. The information on Customer’s metal account and transactions conducted by such account are information comprising banking secrecy and can be disclosed to third parties, if such disclosure is required under the Law or these General Terms and Conditions or is necessary for protecting the rights and legitimate interests of the Parties or one of the Parties.

1.12. Where any suspicions arise as to the authenticity of any documents, as well as Powers of Attorney (including certified by Notary Public) issued by the Customers in favour of third parties presented to the Bank for carrying out metal account transactions, the Bank shall be entitled to send such documents/Powers of Attorney to the respective authorized body for expertise to prove their authenticity and the Bank shall bear no liability for any loss incurred by the Customer due to the delay caused by such actions.

1.13. The funds available on metal accounts of Individual Customers are not guaranteed by the Deposit Guarantee Fund.

2. Procedure of opening and maintenance of the Metal account

2.1. The metal account is opened upon submission of the necessary documents by the Customer. The list of documents required for opening a metal account by the Customer is defined by the Bank and may be amended by the Bank from time to time.

2.2. The Bank shall open for the Customer a metal account of 999.5 purity unallocated gold. Each unit of the unallocated gold reflected in the operational systems of the bank, as well as in the account statements/transaction vouchers provided to customers represents one thousandth troy ounce of unallocated gold: for example, if according to the account statement provided to the customer, 2,000 units are available on customer’s metal account, then customer’s metal account balance shall be equal to 2 troy ounces of unallocated gold.

2.3. The Customer undertakes to provide to the Bank instructions on unallocated gold purchase/sale/transfer for a minimum of 1 (one) troy ounce weight.

2.4. The Bank shall accept the Customer instructions on the days and at the time defined by itself. The instructions received on any other day and at other time during the day shall be deemed to be received on the next working day following the day of receipt. For processing the instructions, the Bank shall be entitled to request from the Customer additional information/approval related to the instruction and shall process the Customer instruction only upon receipt of such information/approval. If it is not possible to receive the additional information/approval from the Customer the Bank reserves the right to decline to process the Customer instruction. The Customer shall be advised on non acceptance of the instruction verbally and/or in writing.

2.5. Time periods for implementation of Customer’s metal account transactions are defined by RA legal acts and the rules/documents stipulated by the Bank based on abovementioned legal acts.

2.6. The Bank shall implement duly filed authentic instructions for implementation of transactions and operations presented by or on behalf of the Customer. The Customer shall be liable for any risk, possible losses and expenses resulting from non implementation of instructions, and such loss and expenses shall not be subject to compensation by the Bank, nor any of its employees or agents.

2.7. The Bank shall effect the transactions on sale/purchase, as well as transfer of unallocated gold based on Customer instructions in the amount of book-value of funds available in metal account as per the date of effecting the transaction.

2.8. The Customer acknowledges that the monetary value of the unallocated gold may be changed as a consequence of changes in gold market value. The Bank shall not be responsible for any loss of the Customer incurred as a result of changes in gold market value.

2.9. The Bank provides to the Customer services of unallocated gold sale, purchase and transfer within the scope of these General Terms and Conditions. The Customer can credit/debit the metal account only in monetary funds.

2.10. The Customer may implement transactions by metal account in the amount of book-value of the funds available on metal account. The Bank shall not extend loans/overdrafts from Customer metal account.

2.11. The Bank shall not pay interests on funds available on Customer metal account, if the Parties do not agree otherwise.

2.12. The funds available on metal account of the Customer held with the Bank shall be deemed to be a security against the liability of the Customer to the Bank which arose with respect to the metal account maintenance by the Bank or for any other reason whatsoever (including with respect to interest, commission fees and other charges) and the Bank shall have the right of pledge with respect to the latter. The Bank shall be entitled to make a set off against liabilities which arose for any of the reasons described above without any acceptance by the Customer and without compiling any additional document.

2.13. The Bank shall provide to the Customer a statement on transactions effected through metal account in the manner and frequency agreed with the Customer. The Bank is not obliged to provide a statement to the Customer if no debit/credit has been made from/to the Customer metal account during the given month. Information reflected in the statement shall be deemed to be a valid notice of transactions conducted on the metal account. It is the responsibility of the Customer to check the accuracy of the statement and notify the Bank of any errors therein within 30 days of the date of such statement. The Bank shall not be held liable for any losses incurred by the Customer due to errors, theft, loss or for disclosure of information which may arise in connection with the postal delivery of the statements.

2.14. The Bank shall be entitled without further authorization of the Customer or prior notification to the Customer to debit from the metal/bank account all taxes subject to levy by the Bank in accordance with the legislation of RoA.
In case of debiting the amount of tax from the metal account the Bank shall debit from the metal account unallocated gold equivalent to the respective amount based on the unallocated gold buy rate defined by itself on the respective transaction date.

2.15. Deposits and withdrawals to/from Customer’s metal account may be made at any branch of the Bank in the Republic of Armenia subject to availability of satisfactory evidence of identity and authorities of the Customer/ Customer’s representative.

2.16. The Bank shall not bear any responsibility for losses incurred by the Customer in cases, where the Customer instruction on transfer of unallocated gold from the metal account held with the Bank to the Customer’s/third party’s metal account with other bank (beneficiary bank) is rejected by intermediary banks due to impossibility of the beneficiary bank to conduct transactions in London gold clearing market or absence of membership of the beneficiary bank in London gold clearing market. The Bank shall not be liable for the losses of the Customer in cases of rejection/late processing of instructions by fault of the Customer.
The Bank shall not be liable for any loss of the Customer due to suspending the transfer of funds or freezing the funds transferred based on the Customer’s instructions on transfer of funds from metal account in accordance with the legislation of foreign countries.

2.17. The Bank shall have the right at any time to use the unallocated gold available on metal account of the Customer with the Bank for the satisfaction of any indebtedness of the Customer to the Bank irrespective of currency and its legal ground. For the purposes of such set-off, the Bank is authorized, if necessary, to debit unallocated gold from the metal account in the amount equivalent to Customer’s debt and charge the respective amount based on the unallocated gold buy rate defined by itself on the respective transaction date.

2.18. In the event of death, incapacity, dissolution, insolvency or bankruptcy (or other analogous, event or proceedings) of the Customer the Bank shall not be liable for any dealings on the metal account unless and until the Bank has received written notice of the same together with other satisfactory documentary evidence as determined by the Bank. In case of receiving a valid notice, the Bank shall suspend all dealings on the metal account until a the successor or duly authorized representative has been suitably empowered to deal with the metal account.

2.19. The Customer may close the metal account by giving prior written notice at any time to the Bank after payment of all moneys due to the Bank at the time of such closing of the metal account. The Bank may on the bases of court orders or resolutions of the Central Bank terminate or suspend dealings on the metal account in the manner stipulated in the RoA legislation without filing a prior notice to the Customer or presenting a justification. The Bank shall have the right to close the metal account of the Customer at its discretion, if the legal acts or conditions set forth herein have been breached by the Customer.
Metal accounts with zero balances may be closed by the Bank after three months for individuals (including private entrepreneurs) and after six months – for legal entities.
In case of closing the metal account the funds available on metal account shall be paid to the Customer based on the unallocated gold buy rate defined by itself on the respective transaction date or based on the instruction of the Customer shall be transferred to the Customer/third parties’ metal accounts held with the Bank/other banks.

3. Procedure of calculation and payment of fees for metal account maintenance

3.1. The Bank shall charge commission fee from the Customer for services stipulated in these General Terms and Conditions in accordance with the Bank’s Tariff of Charges effective at the moment of rendering services.

3.2. All the charges defined under the Tariff of Charges will be levied in Armenian Drams (AMD). Commission will be charged from the metal account of the Customer by debiting the metal account with appropriate funds and making conversion based on CBA gold accounting rate or the unallocated gold buy rate defined by itself on the respective transaction date.

3.3. The Tariff of Charges is available for the Customers at the Bank’s premises. The Tariff of Charges may be amended unilaterally by the Bank with at least one month prior notice to the Customer thereon: the disclosure/placement of the amended Tariff of Charges at the premises of the Bank/the Bank’s web-site shall be deemed a proper notice to the Customer within the context of these General Terms and Conditions.

4. Other provisions

4.1. These General Terms and Conditions shall be effective for indefinite period until the moment of closure of the metal account by the Customer or the Bank in accordance with clause 2.19. of these General Terms and Conditions or on other grounds stipulated by the legislation of the RA.

4.2. These General Terms and Conditions may be amended unilaterally by the Bank with at one month prior notice to the Customer thereon: the disclosure/placement of the amended Tariff of Charges at the premises of the Bank/the Bank’s web-site shall be deemed a proper notice to the Customer within the context of these General Terms and Conditions.

4.3. The communication between the Parties in connection with these General Terms and Conditions shall be made in the manner and based on contact details agreed between the Parties. In case of sending notifications via post or courier the Customer will be deemed to be duly advised on the date of providing the respective communication or other similar document by the Bank to the postal service or the courier. The Customer shall advise the Bank without delay of any change in address, as well as in the information and documents submitted to the Bank. If the Customer fails to advise the Bank on any such change the Bank shall not be liable for any loss incurred by the Customer as a result of making transactions with metal account based on the documents/information available at the Bank.

4.4. These General Terms & Conditions are made and construed in accordance with the legislation of RoA. Any relations with respect to the services stipulated herein and not regulated under these General Terms & Conditions will be subject to the legislation of RoA.

4.5. Any disputes between the Parties in respect of these General Terms and Conditions shall be settled through negotiations. In case of failure to settle such dispute through negotiations it shall be subject to the jurisdiction of courts of Armenia in accordance with the procedure stipulated by the legislation of RoA.

4.6. Individual Customers in cases stipulated by the law have a right to submit the claims in connection with the services hereunder to the Financial System Ombudsman. The explanatory bulletin for dispute settlement arising between the Bank and Individual Customers is attached to these General Terms and Conditions and makes inseparable part thereof (Appendix 1).

4.7. These General Terms and Conditions are made in Armenian and English languages. In case of discrepancies between English and Armenian versions of these General Terms and Conditions Armenian version shall prevail.

Explanatory bulletin on dispute resolution

In case of filing a claim to the Court the dispute between you “HSBC Bank Armenia” CJSC (hereinafter the Bank) will be settled by the court. You can file a claim to the court at any stage of examination of the complaint. The court decision can not be reviewed by the Financial System Mediator.

In case of applying to the Financial System Mediator the dispute between you and the Bank will be settled by the Mediator through the procedure defined by the Law “On the Financial System Mediator” of the Republic of Armenia. The services of the Mediator are free of charge. If you have a compliant, firstly you have to apply to the Bank. The Bank is obliged to reply to your complaint within 10 working days. After the receipt of the response from the Bank you can apply to the Financial System Mediator.

The Financial System Mediator can not examine your complaint, if:

1. the period of 10 working days after the submission of complaint has not expired;
2. you do not claim for any monetary or other property compensation, the amount of compensation claimed by you exceeds AMD 10 million (or its equivalent in other currency); or
3. more than six months have passed since the receipt of the response from the Bank; or
4. the action or inaction complained by you has taken place before 02 August, 2008.

* Dear Customer, please kindly be advised that the Bank has waived its right to appeal the decisions of the Financial System Mediator, if the property claim requested by you does not exceed AMD 250,000 (two hundred and fifty thousand) or its equivalent in other currency and the amount of the transaction does not exceed AMD 500,000 (five hundred thousand) or its equivalent in other currency.

This means that the Bank can not appeal the decisions made by the Financial System Mediator against the Bank through the judicial system if the amount argued does not exceed AMD 250,000 (two hundred and fifty thousand) or its equivalent in other currency and the amount of the transaction does not exceed AMD 500,000 (five hundred thousand) or its equivalent in other currency.

Office of the Financial System Mediator
The Mediator: Piruz Sargsyan
Address: 26/1 Vazgen Sargsyan Street,
“Erebuni Plaza” Business Center, 4-th floor, 411 room, Yerevan 0010
Telephone: (37410) 582321, 582322, Fax: (37410) 582421
E-mail: info@fsm.am
website: www.fsm.am

You can also file a claim to the Central Bank of Armenia
Please be informed that it is not the responsibility of the Central Bank to settle the disputes between You and the Bank, however the Central Bank can impose penalties upon the Bank if it becomes evident that the Bank has breached the law.

Central Bank of the Republic of Armenia
Address: 6 Vazgen Sargsyan Street, Yerevan 0010
Telephone: (37410) 592697
Fax: (37410) 565496
E-mail: chairman@cba.am
website: www.cba.am

* Dear Customer, please kindly be advised that if you have signed an arbitration agreement with the Bank, the disputes arising out the contract signed between you and the Bank are subject to settlement by arbitration tribunal. You are banned from the right to appeal disputes arising out of the contract before the court. As a rule, the decisions of arbitration tribunal are not subject to judicial review.

Note: In case of discrepancies between the Armenian and English versions of this page, the Armenian version shall prevail.

Last updated on: 24/05/2011 14:00