Discretionary Investment Advisory Agreement Template for Philippines

The Discretionary Investment Advisory Agreement is a crucial document used when establishing a professional relationship where an investment adviser is granted authority to make investment decisions on behalf of clients in the Philippines. It is primarily used by licensed investment advisory firms managing portfolios for high-net-worth individuals, corporations, or institutional clients. The agreement must comply with the Securities Regulation Code and SEC regulations, including specific requirements for investment adviser registration, client disclosures, and conduct standards. This document typically includes detailed provisions on investment strategy, risk management, fee structures, reporting requirements, and fiduciary obligations. It's particularly important in the Philippine context where financial markets are becoming increasingly sophisticated and regulatory oversight is strengthening. The agreement serves as the foundation for the ongoing relationship between the adviser and client, clearly defining the scope of discretionary authority and protecting both parties' interests.

1. Parties: Identification of the investment adviser and the client, including registration details of the adviser and complete client information

2. Background: Context of the agreement, including adviser's regulatory status and client's intention to appoint the adviser

3. Definitions: Key terms used throughout the agreement, including investment-related terminology and regulatory references

4. Appointment and Scope of Services: Formal appointment of the adviser and detailed description of discretionary investment management services

5. Investment Objectives and Strategy: Client's investment objectives, risk profile, and agreed investment strategy

6. Discretionary Authority: Extent and limitations of the adviser's discretionary powers in managing the client's portfolio

7. Fees and Charges: Comprehensive fee structure, including management fees, transaction costs, and payment terms

8. Client's Representations and Warranties: Client's confirmations regarding their status, authority, and understanding of investment risks

9. Adviser's Representations and Warranties: Adviser's confirmations regarding licenses, capabilities, and regulatory compliance

10. Risk Disclosures: Mandatory risk warnings and acknowledgments as required by Philippine regulations

11. Reporting and Valuations: Frequency and content of portfolio reports, valuation methods, and performance reporting

12. Compliance with Laws: Obligations regarding regulatory compliance, including anti-money laundering and data privacy

13. Term and Termination: Duration of the agreement and circumstances for termination

14. Confidentiality: Protection and handling of confidential information and client data

15. Liability and Indemnification: Extent of adviser's liability and mutual indemnification provisions

16. Governing Law and Jurisdiction: Philippine law as governing law and jurisdiction for disputes

17. Notices: Method and addresses for formal communications between parties

18. General Provisions: Standard boilerplate clauses including amendments, assignment, and severability