The Financial Management Agreement is essential for establishing professional financial management relationships under German law. It is typically used when a financial institution, asset manager, or investment firm undertakes to manage financial assets on behalf of clients, whether private individuals, corporations, or institutional investors. The agreement must comply with strict German regulatory requirements, including the Banking Act (KWG), Investment Code (KAGB), and Securities Trading Act (WpHG), as well as EU regulations such as MiFID II and GDPR. The document comprehensively covers investment guidelines, risk management, fee structures, reporting obligations, and regulatory compliance requirements, providing a robust legal framework for the financial management relationship while ensuring appropriate client protections under German law.

1. Parties: Identification of the financial manager and the client, including their full legal names, addresses, and registration details

2. Background: Context of the agreement and brief description of the parties' intentions

3. Definitions: Definitions of key terms used throughout the agreement

4. Appointment and Scope of Services: Formal appointment of the financial manager and detailed description of services to be provided

5. Authority and Discretion: Extent of the financial manager's authority to act on behalf of the client

6. Investment Guidelines and Restrictions: Agreed-upon investment strategy, limitations, and risk parameters

7. Fees and Expenses: Detailed fee structure, calculation methods, and payment terms

8. Reporting and Communication: Frequency and content of reports, communication protocols

9. Representations and Warranties: Legal assertions made by both parties regarding their capacity and authority

10. Duties and Obligations: Specific responsibilities of both the financial manager and the client

11. Risk Disclosures: Mandatory risk warnings and acknowledgments as required by German law

12. Confidentiality and Data Protection: Obligations regarding confidential information and GDPR compliance

13. Term and Termination: Duration of the agreement and termination provisions

14. Liability and Indemnification: Extent of liability and indemnification obligations

15. Governing Law and Jurisdiction: Confirmation of German law application and jurisdiction