Policy on the Management of Conflicts of Interest Arising in the Activities of the Crypto Exchange

I. GENERAL PROVISIONS

1.1. This Regulation on the procedure for managing conflicts of interest arising in the activities of a crypto-exchange (hereinafter referred to as the Regulation) has been developed in accordance with the Rules for trading crypto-assets on a crypto-exchange, approved by Order No. 33 of the Director of the National Agency for Prospective Projects of the Republic of Uzbekistan dated July 18, 2022, registered by the Ministry of Justice of the Republic of Uzbekistan on August 15, 2022 (registration No. 3379).

1.2. This Regulation defines the procedure for identifying, preventing, and resolving conflicts of interest arising in the activities of the crypto-exchange, including conflicts of interest arising when the crypto-exchange participates in crypto-asset trading as a trading participant. 

1.3. This Regulation uses the terms and definitions established in the Rules for trading crypto-assets on a crypto-exchange, as well as the following concepts: 

Conflict of interest means a situation in which the personal interest (direct or indirect) of employees of the crypto-exchange, its founders (participants), the ultimate beneficial owner, or members of its management and control bodies affects or may affect the proper, objective, and impartial performance of their official duties and exercise of their powers, and may also cause harm to the rights and legitimate interests of the crypto-exchange’s clients.

Personal interest means the possibility for an employee of the crypto-exchange, its founders (participants), the ultimate beneficial owner, or members of its management and control bodies to receive income in the form of money, other property, including property rights, property-related services, results of completed work, or any benefits (advantages).

Insiders means persons possessing insider information about crypto-assets in accordance with paragraph 21 of the Rules for trading crypto-assets on a crypto-exchange. 

1.4. This Regulation is mandatory for all employees of the crypto-exchange, regardless of their position, as well as for the founders (participants), ultimate beneficial owners, and members of the management and control bodies of the crypto-exchange.

1.5. The crypto-exchange shall post this Regulation on its website in accordance with paragraph 3 of the Appendix to the Rules for trading crypto-assets on a crypto-exchange.

II. BASIC PRINCIPLES OF CONFLICT OF INTEREST MANAGEMENT

2.1. The crypto-exchange’s activities in managing conflicts of interest are based on the following principles:

2.1.1. Priority of clients’ interests over the interests of the crypto-exchange in carrying out its activities.

2.1.2. Ensuring fair treatment of all clients of the crypto-exchange.

2.1.3. Preventing the prioritization of the interests of one or several clients over the interests of other clients.

2.1.4. Mandatory disclosure of information about an existing or potential conflict of interest.

2.1.5. Confidentiality of the process of disclosing information on a conflict of interest and the process of its resolution.

2.1.6. Maintaining a balance between the interests of the crypto-exchange and its clients when resolving a conflict of interest.

2.1.7. Protection of a crypto-exchange employee from retaliation in connection with reporting a conflict of interest that was timely disclosed by the employee themselves.

2.1.8. Individual review of each case of conflict of interest and its resolution.

III. SITUATIONS OF CONFLICT OF INTEREST

3.1. The following conflict of interest situations may arise in the activities of the crypto-exchange:

3.1.1. When the crypto-exchange participates in crypto-asset trading as a trading participant in accordance with paragraph 22 of the Rules for trading crypto-assets on a crypto-exchange. [

3.1.2. When the crypto-exchange enters into transactions in its own name and in its own interests using the client’s funds and crypto-assets in accordance with paragraph 27 of the Rules for trading crypto-assets on a crypto-exchange. 

3.1.3. When the crypto-exchange grants clients the right to use the crypto-assets of the crypto-exchange to execute and settle transactions with them in accordance with paragraph 28 of the Rules for trading crypto-assets on a crypto-exchange.

3.1.4. When the crypto-exchange enters into transactions for the purchase, sale, and/or exchange of crypto-assets in the interests of clients on the basis of intermediary relations in accordance with paragraph 37 of the Rules for trading crypto-assets on a crypto-exchange.

3.1.5. When the crypto-exchange holds crypto-assets owned by the crypto-exchange, its employees, a founder (participant), or the ultimate beneficial owner, in cases provided for by paragraph 6 of the Appendix to the Rules for trading crypto-assets on a crypto-exchange.

3.1.6. When insider trading and price manipulation of crypto-assets are carried out in accordance with paragraph 21 of the Rules for trading crypto-assets on a crypto-exchange. 

3.1.7. In other circumstances where the personal interest of employees of the crypto-exchange, its founders (participants), the ultimate beneficial owner, or members of its management and control bodies may result in improper performance of obligations toward clients.

IV. MEASURES TO PREVENT CONFLICTS OF INTEREST

4.1. In order to prevent conflicts of interest, the crypto-exchange shall take the following measures:

4.1.1. It ensures separate accounting and storage of the funds and crypto-assets of the crypto-exchange and of clients held by the crypto-exchange, in accordance with paragraph 3 of the Rules for trading crypto-assets on a crypto-exchange. 

4.1.2. It does not allow the commingled accounting of funds and crypto-assets of two or more clients in accordance with paragraph 3 of the Rules for trading crypto-assets on a crypto-exchange. 

4.1.3. It establishes a prohibition for crypto-exchange employees on using insider information about crypto-assets to participate in trading in their own name and at their own expense, as well as on transferring such information to third parties, except in cases provided for by law, in accordance with paragraph 21 of the Rules for trading crypto-assets on a crypto-exchange. 

4.1.4. It implements internal control procedures and mechanisms ensuring the identification and prevention of cases of price manipulation of crypto-assets.

4.1.5. When entering into transactions with a client’s funds and crypto-assets in its own name and in its own interests, it acts in accordance with the conditions provided for in paragraph 27 of the Rules for trading crypto-assets on a crypto-exchange, including:

• obtaining the client’s consent;

• entering into transactions only to ensure liquidity or where there is a reasonable belief that the funds will be returned in full;

• ensuring the return of the client’s funds within the agreed period.

4.1.6. When participating in crypto-asset trading as a trading participant, the crypto-exchange discloses information about its participation in accordance with paragraph 22 of the Rules for trading crypto-assets on a crypto-exchange. 

4.1.7. When entering into transactions in the interests of clients, it performs the obligations provided for in paragraph 38 of the Rules for trading crypto-assets on a crypto-exchange, including:

• acting in good faith, reasonably, and competently;

• informing clients of the risks;

• entering into transactions on the best terms and at the best price for clients;

• not entering into transactions at a price that differs significantly from the market price unless otherwise agreed with the client.

4.1.8. It discloses information about crypto-assets admitted to trading that are owned by the crypto-exchange, its employees, a founder (participant), or the ultimate beneficial owner, in cases provided for by paragraph 6 of the Appendix to the Rules for trading crypto-assets on a crypto-exchange.

4.1.9. It ensures a functional separation of duties of crypto-exchange employees that excludes conflicts of interest, including by establishing a system for restricting access to confidential information.

4.1.10. It creates an organizational structure that clearly delineates areas of responsibility, powers, and reporting lines.

4.1.11. It establishes rules for crypto-exchange employees to conduct transactions with crypto-assets on the electronic platform of the crypto-exchange.

V. PROCEDURE FOR IDENTIFYING AND RESOLVING CONFLICTS OF INTEREST

5.1. For the purpose of identifying conflicts of interest, the crypto-exchange carries out the following procedures:

5.1.1. Upon hiring, each employee of the crypto-exchange fills out a conflict of interest declaration reflecting information on the existence of personal interest that affects or may affect the proper performance of their official duties.

5.1.2. Annual completion of conflict of interest declarations by employees holding managerial positions.

5.1.3. Creating conditions for crypto-exchange employees to report the occurrence or possibility of a conflict of interest, including through anonymous reporting mechanisms.

5.1.4. Monitoring transactions carried out on the electronic platform of the crypto-exchange in order to identify cases of price manipulation of crypto-assets and the use of insider information.

5.1.5. Conducting internal inspections and audits in order to identify potential or existing conflicts of interest.

5.2. Procedure for disclosure of a conflict of interest:

5.2.1. Disclosure of information on a conflict of interest shall be made in writing by sending a notice addressed to the head of the crypto-exchange or the person responsible for conflict of interest management.

5.2.2. Initial disclosure of a conflict of interest shall be made:

• upon hiring;

• upon appointment to a new position;

• upon the emergence of a new conflict of interest.

5.2.3. Disclosure of a conflict of interest may also be carried out during annual conflict of interest declarations or based on the results of inspections.

5.3. Procedure for review and resolution of a conflict of interest:

5.3.1. For consideration of information on a conflict of interest and its resolution, a Conflict of Interest Resolution Commission (hereinafter referred to as the Commission) shall be established at the crypto-exchange by order of the head in each case.

5.3.2. The Commission shall review the received information on the conflict of interest within 5 working days from the date of receipt of the notice.

5.3.3. Based on the review, the Commission shall adopt one of the following decisions:

• the situation does not constitute a conflict of interest;

• a conflict of interest exists and measures must be taken to resolve it.

5.3.4. If a conflict of interest is identified, the Commission shall develop recommendations for its resolution, which shall be approved by the head of the crypto-exchange.

5.4. Methods of resolving a conflict of interest:

5.4.1. Restricting a crypto-exchange employee’s access to specific information that may affect their personal interests.

5.4.2. Voluntary recusal of a crypto-exchange employee, or their removal (permanent or temporary), from participation in discussions and decision-making processes on matters that are or may be influenced by a conflict of interest.

5.4.3. Reviewing and amending the official duties of a crypto-exchange employee.

5.4.4. Temporary suspension of an employee from their position if their personal interests conflict with their official duties.

5.4.5. Transfer of an employee to a position involving the performance of official duties not related to the conflict of interest.

5.4.6. Refusal by an employee of their personal interest giving rise to a conflict with the interests of the crypto-exchange and its clients.

5.4.7. Dismissal of an employee at the employer’s initiative for disciplinary misconduct in accordance with labor legislation.

5.4.8. Refusal by the crypto-exchange to enter into a transaction that may lead to a conflict of interest.

5.4.9. Disclosure of information about the conflict of interest and obtaining clients’ consent to enter into the transaction.

VI. LIABILITY FOR VIOLATION OF THE REQUIREMENTS OF THIS REGULATION

6.1. All employees of the crypto-exchange, its founders (participants), the ultimate beneficial owner, and members of the management and control bodies shall be responsible for compliance with the requirements of this Regulation.

6.2. For violation of the requirements of this Regulation, the persons specified in paragraph 7.1 may be subject to the following types of liability:

6.2.1. Disciplinary liability (remark, reprimand, dismissal) — for employees of the crypto-exchange;

6.2.2. Civil liability (compensation for damages) — for all persons specified in paragraph 7.1;

6.2.3. Administrative or criminal liability — in cases provided for by the legislation of the Republic of Uzbekistan.

6.3. The crypto-exchange shall have the right to apply disciplinary sanctions to employees who violate the requirements of this Regulation, regardless of whether damage was caused to the crypto-exchange and its clients as a result of such violations.

VII. FINAL PROVISIONS

7.1. This Regulation shall enter into force from the moment of its approval by the head of the crypto-exchange.

7.2. Amendments and supplements to this Regulation shall be introduced by order of the head of the crypto-exchange.

7.3. The crypto-exchange shall ensure that all employees, founders (participants), the ultimate beneficial owner, and members of the management and control bodies familiarize themselves with this Regulation against signature.

7.4. In all other matters not regulated by this Regulation, the crypto-exchange shall be governed by the Rules for trading crypto-assets on a crypto-exchange and other regulatory legal acts of the Republic of Uzbekistan. 

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© JSC «ASTERIUM», 2026.