Our compliance processes
Our compliance management system ensures that our principles of conduct not only exist, but are effectively implemented in day-to-day business. To this end, we conduct an annual comprehensive compliance risk analysis, in which key risks, including money laundering, corruption, sanctions, fraud and ESG risks, are systematically assessed.
We monitor compliance with legal and regulatory requirements through a multi-level control system consisting of defined control actions (e.g. dual control principle), transaction-related checks, monitoring processes as well as regular random checks and reviews by Internal Audit.
In cases of suspicion, we follow clearly regulated escalation and investigation processes. Violations will be consistently punished and may result in labour, regulatory and civil law measures up to and including termination of the employment or business relationship.
Compliance also provides preventive support to all departments through advice, guidelines, training, control specifications and regular updating of regulatory and internal requirements.
What this means in concrete terms is described for the various topics on the following page.1
Our Code of Conduct
Our Code of Conduct goes above and beyond legal and regulatory requirements and sets out standards for our employees. They also provide guidance for our service providers and suppliers, who must commit to integrity towards us. With the Code of Conduct, we also make it clear to our customers and investors that we are aware of our responsibility and actively shape integrity.
As an integral part of the terms and conditions of employment, all new employees of the Commerz Real Group must confirm in writing that they have read and understood them.
You can find our Code of Conduct here.
Prevention of money laundering and terrorist financing
Compliance’s core tasks include meeting legal and regulatory requirements for the prevention and combating of money laundering and terrorist financing. Both are to be prevented as part of the fight against international terrorism. Here, we act in accordance with the ‘know-your-client’ principle in order to ensure maximum transparency in respect of business relationships and individual transactions. This includes a thorough knowledge and review of our customers and their business processes, with all information of course treated confidentially. Suspicions of money laundering or terrorist financing are reported immediately to the competent authorities in accordance with the legal requirements. Transactions can be blocked or terminated if risks cannot be excluded.
Sanctions and embargoes
Compliance ensures that the economic and financial sanctions relevant to us, as well as supplementary regulatory requirements, are observed. In addition, Compliance issues policies and instructions, informs our various Group units and subsidiaries about sanctions-related restrictions of the business policy, advises on their implementation and monitors their compliance. If business relationships exist in countries affected by sanctions, we as Commerz Real closely monitor them and support them with measures that can extend up to the termination of the business relationship.
Fraud prevention
We take extensive precautions to ensure that clients and employees neither fall prey to nor become involved in fraudulent activity. We also protect our products and processes against misuse. We are emphatically committed to preventive fraud protection across the board and have devised a comprehensive set of measures to prevent, identify and suitably respond to any acts of white-collar crime. We have only one goal: protecting the assets of our customers, Commerz Real and Commerzbank. It is our ultimate maxim to clarify questionable matters and to respond to all economic criminal attempts with zero tolerance without regard for the person. This also means that we welcome any information. Clients, employees and third parties can report any suspicions of fraudulent conduct to us at any time, including anonymously via our whistle-blowing system.
Managing conflicts of interest
Here at Commerz Real, we operate in various fields of business across the globe and are able to offer our clients a plethora of investment and financing products. If our interests run contrary to those of our clients or suppliers, however, this may give rise to conflicts of interest. With the aim of avoiding potential conflicts of interest and resolving conflict situations appropriately, we have introduced a system for managing conflicts of interest that makes decisions transparent and traceable for independent third parties through a standardised procedure and documentation.
To avoid conflicts of interest and improper influence, clear rules apply to all employees regarding the handling of gifts, invitations and other benefits.
- Gifts or hospitality may only be accepted or provided if they are appropriate, transparent and commercially reasonable.
- Value limits and approval processes are mandatory.
- Any form of improper benefit that is likely to influence business decisions is strictly prohibited.
- These regulations apply equally to employees as well as to business partners and third parties acting on behalf of Commerz Real.
Anti-Corruption Policy
Corruption has many faces and occurs in a wide range of areas. Avoiding and combating corruption is our top priority. Our compliance program for combating corruption provides all Commerz Real employees and business partners with the necessary knowledge on how to avoid damage to assets and image due to corruption, fraud, embezzlement, disloyalty, cartel formation or money laundering offences, for example. As such, we ensure that the regulations of applicable anti-corruption legislation are complied with. Preventing corruption in any form is a focal point of our compliance activities and requires each individual to act responsibly so that all activities are in line with applicable laws, voluntary commitments and our internal policies.
Commerz Real prohibits all forms of corruption - including facilitation payments. Facilitation payments are small unofficial payments or benefits made to government agencies or officials with the aim of expediting routine administrative processes or obtaining preferential treatment.
Such payments are strictly prohibited - regardless of their amount, cultural customs or local legislation. This prohibition applies to all employees as well as to all business partners and third parties acting on behalf of Commerz Real.
As part of our due diligence processes, we check that business partners, service providers and intermediaries do not make facilitation payments. Violations will result in disciplinary action up to and including termination of the business relationship.
Facilitation payments are part of our mandatory annual compliance training courses. Employees are trained to recognise and reject such payments based on concrete examples.
Compliance with human rights and environmental risks in accordance with the German Supply Chain Due Diligence Act (LkSG)
We are keenly aware of our corporate responsibility to observe environmental and human rights-related legislation. With this in mind, we are committed to compliance with such legislation – both in our own area of business and along the supply chain – and to helping those affected by environmental and human rights-related violations access support. As part of the Commerzbank Group, Commerz Real is also subject to the declaration of principles published by our parent company. This states that any person who is potentially affected by human rights or environmental rights violations in Commerz Real’s business area or within the supply chains can report via the whistleblower system, regardless of whether this takes place in Germany or abroad.
The Commerzbank AG policy statement can be found here.
Compliance Training
An essential part of our compliance management is the empowerment of our employees. With compliance training, we ensure clarity about laws, regulations and company policies that apply to their daily professional responsibility. At Commerz Real, IT-supported training courses (so-called web-based training courses) are carried out, which enable all employees to acquire relevant knowledge. Within Commerz Real, the Compliance unit acts as the training owner for the compliance training courses and assesses the training requirements at local level, taking into account the legal and regulatory requirements. The following compliance topics are covered:
- Prevention of money laundering
- Sanctions
- Market compliance (including conflicts of interest)
- Fraud prevention
- Anti-bribery and corruption
- Compliance with the German Supply Chain Act
- Combating tax evasion assistance
These are partly divided into “basic” and “advanced” training courses and are assigned depending on the level of knowledge required in the respective function. Participation in the training courses is mandatory for all Commerz Real employees.
Anti-competition law
Commerz Real undertakes to strictly comply with all competition and antitrust law requirements. We expressly prohibit:
- Pricing agreements
- Market or customer splits
- Coordinated conduct with competitors
- Prohibited disclosure of information
- Bid rigging or coordinated bid submissions
- Agreements that could restrict fair competition.
This prohibition applies to all employees and all business partners acting on behalf of Commerz Real. Competition violations will not be tolerated and will lead to consequences under labour or civil law.
We actively protect ourselves against antitrust risks through mandatory training on competition and antitrust law, clear internal guidelines for participation in industry initiatives and associations, the four-eyes principle for external communication situations, upstream compliance approvals for public statements, cooperations or ESG initiatives in which competitors are involved, and monitoring and escalation mechanisms by Compliance & Legal.
These measures ensure that our business is always conducted fairly, lawfully and in accordance with international and European competition laws.
Integrity of financial reporting
We are committed to providing complete, accurate and timely reporting of all financial and business-related information.
- Manipulation, misrepresentation or withholding of material information is expressly prohibited.
- Our internal control system (ICS) and internal auditing ensure that financial reports and disclosures are carefully reviewed and reliable.
- The annual financial statements of Commerz Real AG are audited annually by independent external auditors.
- Employees are obliged to record all business-relevant data correctly, comprehensibly and in accordance with internal guidelines and legal requirements.
Tax Compliance Client
Tax honesty is a key component of our understanding of responsible business conduct. Commerz Real does not support any models or structures aimed at tax avoidance or evasion.
- Risk-based tax compliance checks: As part of our Know Your Customer and AML process, we carry out a tax-related risk analysis for all customers. This includes checking tax residence, beneficial owners, complex ownership structures and other tax-relevant risk factors.
Mandatory proof of tax compliance: We require all customers to provide binding tax declarations and documents, including:
This proof is a prerequisite for entering into or continuing a business relationship.
- Monitoring and updating: Tax-relevant data is checked and updated regularly. Suspicions or discrepancies are documented, analysed and - if necessary - reported to the competent authorities in accordance with the legal requirements. In the event of serious deviations, we reserve the right to terminate the business relationship.
Internal control system & compliance procedure: Our internal control system includes:
- Regular monitoring of FATCA and CRS compliance
- risk-based random checks
- Systematic monitoring of tax risk characteristics
- Systematic monitoring of tax risk characteristics
- Clearly defined escalation and reporting channels
- Training of relevant employees: All employees in Sales, Customer Service and Compliance receive regular training on tax due diligence obligations, FATCA/CRS rules, KYC and AML processes, as well as on the identification of tax non-compliance.
Whistle-blowing
Violations of laws, regulatory requirements and relevant internal regulations or even criminal acts cannot be tolerated.
That is why Commerz Real supports and protects all whistleblowers who report whistleblowing cases. Whistleblowing reports to Compliance can be submitted through several internal channels, including the web-based BKMS whistleblowing system, which is accessible 24/7 and enables completely anonymous communication via a protected mailbox. The system is operated on secure servers, encrypted and independently administered.
The identity of the whistleblowers is treated as strictly confidential and only disclosed on a need-to-know basis. People who report in good faith are protected from any form of discrimination or retaliation. This protection also extends to persons who support whistleblowers or are closely associated with them.
At the same time, the data subject or accused person is also protected with regard to their identity during the investigation of the whistleblowing case.
All incoming reports are checked by the local compliance units of Commerz Real. There are clear and Group-wide defined procedures for investigating suspected cases, including escalation to independent bodies within the Commerzbank Group in the event of a conflict of interest.
Whistleblowers receive confirmation of receipt within a maximum of seven days and feedback on the processing status within three months at the latest, insofar as legally permissible.
