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1. About this document

This Financial Services Guide (“FSG”) is an important document. You should read it carefully and make sure you understand it.

This FSG is dated 9 February 2011 and is provided to you by Aliom Pty Ltd A.C.N 123 876 291 (“Aliom”, we, our, us) to inform you of the financial services we are able to provide and to assist you in deciding whether to use any of the services offered in this FSG. This FSG replaces all prior versions.

This FSG explains:

• Other disclosure documents we may give you
• Who we are and how you can contact us
• Financial services and products we are authorised to provide
• How you can instruct us
• How we get paid (remuneration, commissions, benefits)
• How we deal with customer complaints and where you can go for further help
• Our compensation arrangements
• Potential conflicts of interest 
• Records we keep and privacy policy  
• This FSG contains general information. If you have further questions after reading it please contact us.

2. Other Disclosure Documents we may give you

Aliom will provide clients with documentation to facilitate transactions including client agreements, terms and conditions and confirmations.

Aliom can provide you with factual information and research, and facilitate execution requests.

Where we make a recommendation on a product (other than securities listed on the ASX or a managed discretionary account service) to a retail client, we will provide a Product Disclosure Statement (“PDS”) which will assist you in deciding whether to acquire the financial product. The PDS contains important information about the product features, benefits, risks and fees associated with that product. The PDS should be read carefully to enable you to make an informed decision about whether to utilise the product.

You are entitled to receive a Statement of Advice (“SOA”) when we give you personal advice as a retail client. Personal advice is advice that takes into account your personal objectives, financial situation and needs. The SOA will set out the advice and will include information regarding the basis on which the advice was given, any fees or commissions received in providing the advice and a warning where the advice has been provided based on incomplete information. If we provide you with additional advice we may give you a Statement of Additional Advice (“SOAA”). The Statement of Advice and Statement of Additional Advice present the advice and basis on which it was given.

Where you maintain the advice relationship with us, a Statement of Advice may not be provided for further advice situations provided that your circumstances and the basis of the advice are not significantly different. However, we are required to keep a record of the advice. You may request a copy of the Record of Advice (“ROA”) we keep up to 7 years after the advice was given.

3. Who we are

Aliom Pty Ltd A.C.N 123 876 291 (“Aliom”, we, our, us) is responsible for the Financial Services described in this guide. Aliom holds an Australian Financial Services Licence (“AFSL”) AFSL Number 323182.

Aliom is a financial services firm that deals predominately in exchange-traded and over-the-counter derivatives.

Your client advisor is a representative of, and acts on behalf of, Aliom. Aliom does not act as a representative of any other licensee in relation to the services or products we provide.

4. Financial Services we are authorised to provide

Aliom is authorised under its AFSL to provide you with the following range of financial services:

1. provide advice on the following classes of financial products:

• deposit and payment products (limited to basic deposit products);
• derivatives;
• foreign exchange contracts;
• government debentures, stocks or bonds;
• interests in managed investment schemes (excluding investor directed portfolio services);
• interests in managed investment schemes limited to managed discretionary account services; and
• securities;

2. deal in the following classes of financial products by issuing, acquiring, applying for, varying or disposing of those products:

• derivatives;
• foreign exchange contracts; and
• interests in managed investment schemes limited to managed discretionary account services;

3. deal in the following classes of financial products by applying for, acquiring, varying or disposing of those products on behalf of another person:

• deposit and payment products (limited to basic deposit products);
• derivatives;
• foreign exchange contracts;
• government debentures, stocks or bonds;
• interests in managed investment schemes (excluding investor directed portfolio services);
• interests in managed investment schemes limited to managed discretionary account services; and
• securities; and

4. make a market in:

• foreign exchange contracts; and
• derivatives.

Our AFSL authorises us to provide the above services to retail and wholesale clients (within the definition contained in the Corporations Act).

5. Nature of Advice and our Responsibilities

Aliom provides both personal advice and general advice in relation to securities. Personal advice is advice that takes into account one or more of your objectives, financial situation and needs (“your Personal Circumstances”). You should immediately notify your client adviser if your Personal Circumstances change. Each time you receive any personal advice, you will be asked to confirm whether your Personal Circumstances have changed. Your client adviser can only make recommendations based on the information provided by you. Without all the necessary information, the advice given may not be appropriate for your Personal Circumstances.

Please note that although authorised to do so, Aliom does not usually provide personal advice in relation to other financial products, such as derivatives and foreign exchange contracts (other than under Aliom’s managed discretionary account service, discussed in section 7 below). Any general advice we provide to you as a retail client does not take account of your Personal Circumstances. Before acting on any general advice, you must consider the appropriateness of the advice in light of your Personal Circumstances. Newsletters, trade alerts and research papers are examples of general advice we may give you.

Before taking any action to acquire any of the financial products or services mentioned in this FSG you should consider whether the product or service is appropriate having regard to your Personal Circumstances. You should also consult the relevant PDS and ensure that you understand the risks associated with the financial products and services you enter into with Aliom.

6. Products we provide

Aliom provides an execution service and/or provides you with general or personal advice in relation to securities and exchange traded derivatives (futures, options, warrants).

Aliom is a market maker when dealing in foreign exchange contracts and derivatives. Accordingly, Aliom acts as principal in all transactions with you in respect of margin foreign exchange contracts (“Margin FX”) and contracts for difference (“CFD”).

Aliom may also arrange for you to be supplied with financial services and products issued by non-related product providers. Aliom may receive a fee or commission payment from these non-related product providers as a result of you investing in one of their products or services. Any remuneration that Aliom may derive is included in the fees and commissions you pay as outlined under the heading “How do we get paid”.

7. Managed Discretionary Accounts

A “managed discretionary account”, or MDA, is an arrangement whereby you authorise Aliom to operate your account and conduct trading activities on your behalf without prior reference to you. Aliom offers an MDA service for exchange-traded derivatives and for securities.

Clients must enter into a formal “MDA Contract” before Aliom can provide MDA services.

The “MDA Contract” with a retail client will include an Investment Program that complies with Division 3 of Part 7.7 of the Corporations Act (concerning Statements of Advice) and will contain information about the following:

• the nature and scope of the discretions Aliom will be authorised and required to exercise and the investment strategy that is to be applied in exercising those discretions;
• any significant risks associated with the MDA service;
• the basis on which we consider the MDA service to be suitable for the client; and
• warnings that the Investment Program may not be suitable for the client if the client has provided us with limited or inaccurate information, and that the Investment Program may cease to be suitable if the client’s relevant personal circumstances change.

Aliom will review the suitability of the Investment Program for the client once every 12 months, however a change in the client’s personal circumstances may mean an earlier review is required.

There are significant risks associated with entering into an MDA Contract. In general the risks of an MDA correspond to the risks of the underlying investments, being derivatives and securities. Derivatives trading in particular has a very high degree of risk, and a client could sustain a total loss of capital and be liable for substantial losses. The risks associated with any particular derivative product traded as part of an MDA service are set out in the relevant PDS for that particular product. There are additional risks associated with the MDA. The client will not control the day-to-day investment decisions in relation to the account, and will be bound by Aliom’s trading decisions. Aliom may undertake a large number of trades for a client, incurring transaction costs. While it is the intention of Aliom to make profits every time we trade the markets, Aliom’s judgment on a particular trade may be incorrect and result in a loss.

Managed discretionary account service arrangements are only suitable for clients who understand financial markets and the risks associated with trading in these markets. Aliom recommends that all clients obtain independent advice before entering into an MDA Contract with us.

Aliom will provide our MDA clients with a report at least daily. This report will detail your investment portfolio, including comprehensive information as to transactions and performance for the period. You will also receive an Annual Report summarising the information provided.

If you wish to instruct Aliom in relation to the financial assets held in your managed discretionary account portfolio, you must do so by the methods set out elsewhere in this FSG.

In the case of the securities MDA, the client will hold custody of portfolio assets as part of their CHESS holdings with the execution and clearing broker. The name and contact details of the execution and clearing broker (which may change from time to time) will be specified in the MDA Contract. Aliom does not provide custodial or depository services in relation to a client’s portfolio assets under the securities MDA.

In the case of the derivatives MDA, derivatives will be acquired on exchanges by licensed participants on behalf of the client, and client funds will be held by Aliom in its client segregated account established under the Corporations Act.

8. How to instruct us

Before transacting with Aliom you must open an account with us.

You may then give instructions to us in any of the following ways:

• by the telephone (note your telephone calls to us may be recorded);
• in writing (including email or facsimile by prior arrangement, note you must confirm with us that such instructions have in fact been received by us); and
• electronically via Aliom’s internet trading platform (“Aliom DealBook”), or via other third party electronic trading applications such as PATS, TT Echo etc (by prior arrangement).

9. How do we get paid?

a. Transaction based fees for products we execute on your behalf

Aliom is remunerated through the fees and commissions that we charge you for executing transactions on your behalf. Fees and commissions charged to you will depend on the type of financial product being traded, the frequency of your trading activity, the type and level of service required and the size of your transaction. Rates are subject to negotiation prior to transacting any business. Fees and commissions, once disclosed and agreed, will be charged to your Trading Account at the time any transaction is executed.

The brokerage rates below are the maximum that Aliom may charge and are provided as a guide only. A detailed description of the fees, charges and commissions payable are contained in the PDS for the relevant financial product. Aliom will provide you with details of the rates applicable to you at the time you enter into the client agreement.

Aliom, acting reasonably may change these rates from time to time. Such changes will be notified to you by email, in writing or where you have agreed by us posting a notice to our website, www.aliom.com.au. We recommend that you seek advice from a professional tax agent.

*In some cases fees may be exempt from GST where the supply is made to a non-Australian resident.

b. Transaction based fees for products issued by Aliom

For products issued by Aliom we will charge you a per transaction fee. Fees charged to you will depend on the type of financial product being traded, the frequency of your trading activity, the type and level of service required and the size of your transaction. Rates are subject to negotiation prior to transacting any business. Fees, once disclosed and agreed, will be charged to your trading account when you buy and sell at the time your transaction is executed.

The fees below are the maximum that Aliom may charge and are provided as a guide only. A detailed description of the fees, charges and commissions payable are contained in the PDS for the relevant financial product. Aliom will provide you with details of the rates applicable to you at the time you enter into the client agreement.

Aliom, acting reasonably may change these fees from time to time. Such changes will be notified to you by email, in writing or where you have agreed by us posting a notice to our website, www.aliom.com.au. For a full list of all relevant charges including interest, financing charges and other service fees (if applicable), please view the relevant product PDS. We recommend that you seek advice from a professional tax agent.

c. Fees for our Managed Discretionary Account service

The fees below are the maximum that Aliom may charge in respect of our managed discretionary account service. These fees are provided as a guide only. A detailed description of the fees, charges and commissions payable in respect of the financial product traded under the managed discretionary account service will be detailed in the MDA Contract. Aliom will provide you with details of the rates applicable to you at the time you enter into the MDA Contract.

Aliom, acting reasonably may change these fees from time to time. Such changes will be notified to you by email, in writing or where you have agreed by us posting a notice to our website, www.aliom.com.au. We recommend that you seek advice from a professional tax agent.

*In some cases fees may be exempt from GST where the supply is made to a non-Australian resident.

d. Fees for some limited Full Service Accounts

The fees below are the maximum that Aliom may charge in respect of some limited full service accounts operated by Aliom on a non-discretionary, general advice basis. These fees are provided as a guide only. Aliom will provide you with details of the rates applicable to you at the time you enter into the service.

Aliom, acting reasonably may change these fees from time to time. Such changes will be notified to you by email, in writing or where you have agreed by us posting a notice to our website, www.aliom.com.au. We recommend that you seek advice from a professional tax agent.

*In some cases fees may be exempt from GST where the supply is made to a non-Australian resident.

e. Fees for advising on and arranging dealing in securities

Aliom will not charge clients any fees for providing personal financial product advice or preparing Statements of Advice.

Brokerage will be charged to your Equity account by Aliom’s Execution and Clearing Broker. Brokerage will be between 0.06% and 1.25% of the contract value (depending on the size of the contract value), subject to a minimum brokerage of $16.50 (all inclusive of GST). The brokerage will be shared between Aliom and Aliom’s Execution and Clearing Broker such that Aliom will receive from its Execution and Clearing Broker a commission equal to the brokerage less an amount to be retained by its Execution and Clearing Broker. Some trade examples are detailed below which show the impact of brokerage and the commission Aliom may receive.

You expect SUNCORP-METWAY LIMITED (SUN) to announce good profit results to the market and anticipate its price could rise by 7% over the next sixteen days.

f. Administration Charges

Administrative services provided by Aliom to which fees may apply are outlined in the following table.

g. Commissions, remuneration and other benefits received by Aliom

Aliom is entitled to retain any interest it earns on client money held in the segregated accounts it must maintain pursuant to the Corporations Act. The rate of interest is determined by the provider of each segregated account.

Our employees and directors are remunerated by way of salary and other employee benefits. They may also be eligible for a discretionary bonus related to business objectives. Certain employees, directors and representatives may also receive up to 100% of all fees and commissions generated from their clients depending on the level of salary and the aggregate revenue that they earn for Aliom. Such payments are discretionary and are generally made in the form of monetary benefits and are paid quarterly or annually.

h. Commissions, remuneration and other benefits paid by Aliom

You may have been referred to us by a service provider who may receive financial or non-financial benefits from us. These should be disclosed to you by the service provider in question. Please note that such benefits will not impact transaction fees or the rates you will be offered for financial products or services undertaken with Aliom.

i. Soft dollar benefits

Aliom may from time to time receive a benefit from preferred product providers including educational seminars, conferences, and training days. Details of benefits valued at AUD$300 or above received by us will be maintained on a register.