Client conflicts

As a general rule, when a Client Conflict exists (sometimes referred to as a "legal conflict"), we cannot act or, if acting, must cease to act for one and potentially all relevant clients. The use of €˜information barriers' cannot resolve a Client Conflict. There are, however, two possible exemptions which can allow us to act:

1. Substantial common interest exemption - This exemption applies where conflicting clients have a substantial common interest. We need informed consent in writing from the relevant clients before we can continue to act.
2. Auction bid exemption - This exemption applies where conflicting clients are competing for the sole right to buy a single asset/group of assets. However, this exemption should be used sparingly as it is still possible, even with information barriers, for an Information Conflict to exist (see below).

It is important to note that the exceptions set out above may only be used with the written consent of the Director of Operations and Compliance or MLRO where we are confident that we can represent both or all clients even-handedly, in their respective best interests and without any one of them being prejudiced by the lack of separate legal representation. In the case of representing different clients competing for the same asset or group of assets (e.g. an auction), the clients must be €˜sophisticated users of legal services'.

Hint: Where you detect a potential conflict (e.g. when acting for two clients whose interests may later diverge), it is important to include the required wording to address the risk of needing to withdraw. You can use this template conflicts rider. You should also contact the MLRO to discuss this before sending out the amended Engagement Letter.