Regulation on the Anti-Corruption Policy of KS-Development LLC

REGULATION on the Anti-Corruption Policy of KS-Development LLC

1. INTRODUCTION

1.1. This Regulation on the Anti-Corruption Policy (hereinafter referred to as the Anti-Corruption Policy) reflects the commitment of KS-Development LLC (hereinafter referred to as the Company) and its management to the standards of conducting open and honest business, with the aim of preserving and maintaining the business reputation of the Company, and also defines the key principles and requirements aimed at preventing corruption and compliance with the applicable anti-corruption legislation by the Company, members of the Company’s management bodies, and its employees.

1.2. The Company’s Anti-Corruption Policy is a fundamental document defining the main objectives, principles, and directions of anti-corruption activities. The purpose of its creation is to coordinate the activities of the Company’s employees in implementing anti-corruption measures aimed at preventing, detecting, and suppressing corrupt practices within the Company.

1.3. The Company’s Anti-Corruption Policy is intended for use in terms of compliance with the key norms of applicable anti-corruption legislation.

1.4. The Company’s Anti-Corruption Policy applies to the Company’s counterparties and representatives, as well as to other persons when the relevant obligations are stipulated in contracts with them.

1.5. The Policy has been developed in accordance with the current legislation of the Russian Federation, the Company’s Charter, and other local regulatory acts of the Company.

1.6. All employees of the Company must be guided by this Policy and strictly adhere to its principles and requirements.

2. APPLICABLE ANTI-CORRUPTION LEGISLATION

2.1. The Company and all its employees must comply with the norms of Russian anti-corruption legislation, established, inter alia, by the Criminal Code of the Russian Federation, the Code of Administrative Offenses of the Russian Federation, Federal Law No. 273-FZ of December 25, 2008 “On Combating Corruption,” and other regulatory acts, the main requirements of which include the prohibition of the following acts:

Corruption;
Giving a bribe;
Receiving a bribe;
Bribery mediation;
Abuse of authority;
Commercial bribery;
Illegal remuneration on behalf of the Company;
Illegal engagement in labor activities, or for the performance of work or provision of services of a state or municipal employee, or a former state or municipal employee.

3. GOALS AND OBJECTIVES OF THE ANTI-CORRUPTION POLICY

3.1. The goal of the Anti-Corruption Policy is the development and implementation of diverse and consistent measures to prevent, eliminate (minimize) the causes and conditions that give rise to corruption, and to form an anti-corruption consciousness characterized by the intolerance of the Company’s employees, clients, counterparties, and management bodies towards corrupt practices.

3.2. The objectives of the Company’s Anti-Corruption Policy are:

Forming among clients, counterparties, management bodies, and employees of the Company a uniform understanding of the Company’s position of rejecting corruption in any forms and manifestations;
Minimizing the risk of involving the Company and its employees, regardless of their position, in corrupt activities;
Preventing corrupt practices and ensuring accountability for corrupt practices;
Compensating for damage caused by corrupt practices;
Forming an anti-corruption corporate consciousness;
Creating a legal mechanism preventing the bribery of subjects of the Anti-Corruption Policy;
Establishing the obligation of the Company’s employees to know and comply with the principles and requirements of this Policy, and the key norms of applicable anti-corruption legislation;
Creating incentives to fill positions in the Company with incorruptible individuals.

4. PRINCIPLES OF THE COMPANY’S ANTI-CORRUPTION POLICY

4.1. The key principles of the Company’s Anti-Corruption Policy are:

Principle of compliance of the Company’s Anti-Corruption Policy with the current legislation of the Russian Federation and generally accepted norms. Conformity of the implemented anti-corruption measures with the Constitution of the Russian Federation, international treaties concluded by the Russian Federation, the legislation of the Russian Federation, and other regulatory legal acts applicable to the Company.
Principle of personal example from management. The key role of the Company’s management in shaping a culture of intolerance towards corruption and in creating an intra-organizational system for preventing and combating corruption.
Principle of employee involvement. Awareness of the Company’s employees about the provisions of the anti-corruption legislation of the Russian Federation and their active participation in the formation and implementation of anti-corruption standards and procedures.
Principle of proportionality of anti-corruption procedures to the risk of corruption. The development and implementation of a set of measures to reduce the likelihood of involving the Company, its managers, and employees in corrupt activities is carried out taking into account the corruption risks existing in the Company’s activities.
Principle of effectiveness of anti-corruption procedures. Application of such anti-corruption measures in the Company that have a low cost, ensure ease of implementation, and bring significant results.
Principle of responsibility and inevitability of punishment. The inevitability of punishment for employees of the Company, regardless of their position, length of service, and other conditions, in the event they commit corruption offenses in connection with the performance of their labor duties, as well as personal responsibility of the Company’s management for the implementation of the intra-organizational anti-corruption policy.
Principle of business openness. Informing counterparties, partners, and the public about the anti-corruption business standards adopted by the Company.
Principle of constant control and regular monitoring. Regular monitoring of the effectiveness of implemented anti-corruption standards and procedures, as well as control over their implementation.

5. PROCEDURES OF THE COMPANY’S ANTI-CORRUPTION POLICY

5.1. Prohibition of Corruption.
5.1.1. Employees of the Company are strictly prohibited from directly or indirectly, personally or through the mediation of third parties, participating in corrupt actions, offering, giving, promising, soliciting, or receiving bribes, or making payments to simplify administrative, bureaucratic, and other formalities in any form, including in the form of money, valuables, services, or other benefits, to any persons and from any persons or organizations, including commercial organizations, government and self-government bodies, civil servants, private companies, and their representatives, for the benefit of the Company.

5.2. Adequate Anti-Corruption Procedures.
5.2.1. The Company develops and implements adequate procedures to prevent corruption, reasonably responding to identified risks, and monitors their compliance.

5.3. Mission of the Company’s Management.
5.3.1. Officials of the Company must form an ethical standard of uncompromising attitude towards any forms and manifestations of corruption at all levels, setting an example by their behavior and familiarizing all employees with the Anti-Corruption Policy.
5.3.2. The Company establishes the principle of rejecting corruption in any forms and manifestations (the “zero tolerance” principle) in carrying out daily activities and strategic projects, including in interaction with investors, counterparties, representatives of government bodies, self-government, political parties, its employees, and other persons.
5.3.3. Officials of the Company undertake obligations in their professional activities to:

comply fully with the requirements of the current legislation of the Russian Federation and other legal norms, and in the absence of applicable legislation, be guided by the requirements of good faith, reasonableness, fairness, and the provisions of this Anti-Corruption Policy;
refrain from any unfair methods of doing business;
in the event of a risk of losses or reputational risks for the Company, immediately inform the top management of the Company;
not use their official position, confidential information, material and non-material assets of the Company for personal purposes;
not allow unlawful actions in professional activities, or actions that may raise suspicions regarding their legality and ethics;
refrain from unethical methods of competition;
refrain from actions or inactions that give rise to conflicts in business relations, strive to resolve conflicts that arise on the basis of a balance of interests of participants in business relations;
inform the General Director about any positions they hold outside and without the knowledge of the Company, the performance of duties in which creates a conflict of interest with the interests of the Company, and before agreeing to take such positions, they are obliged to notify of their intentions.

5.4. Duties of the Company’s Employees:

refrain from committing and/or participating in the commission of corruption offenses in the interests or on behalf of the Company;
refrain from behavior that may be interpreted by others as a readiness to commit or participate in the commission of a corruption offense in the interests or on behalf of the Company;
immediately inform their immediate supervisor of cases of inducement of the employee to commit corruption offenses;
immediately inform their immediate supervisor of information known to the employee about cases of corruption offenses committed by other employees, counterparties of the Company, or other persons;
inform their immediate supervisor about the possibility of occurrence, or the occurrence of, a conflict of interest for the employee.

5.5. Periodic Risk Assessment.
5.5.1. The Company periodically identifies, reviews, and assesses the possibility of occurrence of corruption risks characteristic of its activities.

5.6. Handling Appeals from Company Employees, Counterparties, and Other (Individual and Legal) Persons Regarding Corruption Facts.
5.6.1. The Company declares openness in the fight against corruption.
5.6.2. The Company receives appeals regarding corruption facts via mail sent to the Company’s postal address, and in person.
5.6.3. The Company is guided by the principles of an effective system for reviewing and resolving appeals regarding corruption facts within the Company, preparing responses within the time limits established by the legislation of the Russian Federation and the Company’s internal regulatory documents.

5.7. Conflict of Interest Management.
5.7.1. The Company declares the implementation of measures to comply with corporate ethics norms (compliance with the Code of Corporate Ethics), standards of corporate conduct, compliance with internal documents regulating cases of conflict of interest, as well as measures aimed at preventing such cases.
5.7.2. The Company implements measures to prevent conflicts of interest, which are aimed at excluding the possibility, including obtaining personally or through an intermediary, material and/or personal benefits as a result of the employees of the Company, or their family members, or persons in close kinship or affinity with them (parents, spouses, children, brothers, sisters, as well as brothers, sisters, parents, children of spouses and spouses of children) having rights that provide such an opportunity as a result of their use of their official position.
5.7.3. The Company strives to prevent and timely resolve pre-conflict situations among the Company’s employees.
5.7.4. The Company adheres to the following principles of conflict of interest management:

mandatory disclosure of information about a real or potential conflict of interest;
individual consideration and assessment of reputational risks for the Company upon detection of each conflict of interest and its resolution;
confidentiality of the process of disclosing information about a conflict of interest and the process of its resolution;
maintaining a balance of interests of the Company and the employee when resolving a conflict of interest;
protection of the employee from persecution in connection with reporting a conflict of interest that was timely disclosed by the employee and resolved (prevented) by the Company.

5.8. Anti-Corruption Measures.
The Company implements the following anti-corruption measures in order to prevent and combat corruption:
5.8.1. Regulatory support, consolidation of standards of conduct, and declaration of intent.
5.8.2. Development and introduction of special anti-corruption procedures.
5.8.3. Training and informing Company employees on issues of preventing and combating corruption.
5.8.4. The Company strives to have business relations with counterparties that support the requirements of anti-corruption legislation and/or counterparties that declare non-acceptance of corruption.
5.8.5. The Company declares that it refuses to incentivize in any way the employees of counterparties, including by providing sums of money, gifts, free performance of work (services) for them, and other methods not mentioned here, which place the counterparty’s employee in a certain dependence and are aimed at ensuring that this employee performs any actions in favor of the Company.
5.8.6. The Company welcomes the development of partnerships with external clients and counterparties and allows the exchange of modest corporate gifts between partner parties.
5.8.7. The Company allows the receipt and giving of gifts by employees from clients/counterparties with an estimated value of no more than three thousand Russian rubles, unless otherwise provided by a special internal order of the General Director.
5.8.8. Gifts in the form of money are prohibited.

5.9. Participation in Charitable Activities and Sponsorship.
5.9.1. The Company does not finance charitable and sponsorship projects in order to obtain commercial advantages in specific projects of the Company.

5.10. Participation in Political Activities.
5.10.1. The Company does not independently or through its employees finance political parties or public associations in order to obtain or maintain advantages in commercial activities.
5.10.2. Employees of the Company have the right, in their own name, to participate in public associations, such as political parties, public organizations, public movements, public foundations, and other non-profit organizations created in accordance with the current legislation of the Russian Federation, as well as in international public associations, the purpose of which is not to obtain or maintain advantages for the Company in commercial activities.
5.10.3. When participating in public associations, employees of the Company are prohibited from offering, giving, promising, or making payments, contributing property, giving gifts, etc., on behalf of the Company in order to obtain or maintain advantages for the Company in commercial activities.

5.11. Interaction with Public Officials.
5.11.1. The Company does not independently or through its employees pay any expenses (monetary remuneration, loans, services, payment for entertainment, recreation, transport expenses, and other remuneration) for public officials and/or their close relatives in order to obtain or maintain advantages for the Company in commercial activities.
5.11.2. The provision of gifts to public officials must not violate the requirements of the Anti-Corruption Policy and the legislation of the Russian Federation.

5.12. Payments Through Intermediaries or in Favor of Third Parties.
5.12.1. The Company and its employees are prohibited from engaging or using intermediaries, partners, agents, joint ventures, or other persons to commit any actions that contradict the principles and requirements of the Company’s Anti-Corruption Policy or the norms of applicable anti-corruption legislation of the Russian Federation.
5.12.2. The Company ensures the availability of procedures for checking intermediaries, partners, counterparties, and other persons to prevent and/or detect the violations described above in order to minimize and suppress the risks of involving the Company in corrupt activities.

5.13. Maintaining Accounting Books and Records.
5.13.1. All financial transactions of the Company must be accurately, correctly, and with a sufficient level of detail reflected in the Company’s accounting records, documented, and available for verification.
5.13.2. The Company appoints employees responsible, as provided by the current legislation of the Russian Federation, for the preparation and submission of complete and reliable accounting reports within the established time limits.
5.13.3. Distortion or falsification of the Company’s accounting reports is prohibited in accordance with the current legislation of the Russian Federation.

5.14. Corruption Prevention.
5.14.1. The Company conducts an introductory briefing for all newly hired employees, which includes informing them about anti-corruption legislation, the measures taken by the Company for these purposes, as well as the provisions and requirements of this Anti-Corruption Policy.
5.14.2. The Company declares that no employee will be subject to sanctions (including dismissal, demotion, or deprivation of bonuses) if they report an alleged fact of corruption, or if they refuse to give a bribe, commit commercial bribery, or act as an intermediary in bribery, even if, as a result of such refusal, the Company incurred, among other things, lost profits or failed to obtain commercial and competitive advantages.
5.14.3. The Company requires its employees to comply with the Anti-Corruption Policy, informing them of the key principles, requirements, and sanctions for violations. All employees of the Company must be guided by the Company’s Anti-Corruption Policy and strictly adhere to its principles and requirements. From the moment this Anti-Corruption Policy comes into force, each employee of the Company must sign a commitment (agreement) to comply with the principles and requirements of the Company’s Anti-Corruption Policy and the norms of anti-corruption legislation upon concluding an employment contract.
5.14.4. If any employee has doubts about the legality or conformity with the goals, principles, and requirements of the Anti-Corruption Policy of their own actions, as well as the actions (inactions) or proposals of other employees, counterparties, or other persons interacting with the Company, they must report this to their immediate supervisor, who will, if necessary, provide recommendations and clarifications regarding the situation.
5.14.5. Due to the possible change over time of corruption risks and other factors affecting economic activity, the Company monitors the implemented adequate procedures for preventing corruption, controls their compliance, and if necessary, revises and improves them.

5.15. Informing.
The Company places this Anti-Corruption Policy in the public domain on the Company’s corporate website on the Internet, openly declares its rejection of corruption, welcomes and encourages compliance with the principles and requirements of the Anti-Corruption Policy by all counterparties, its employees, members of management bodies, and other persons.

6. RESPONSIBILITY FOR VIOLATION

6.1. The General Director and employees of all structural divisions of the Company, regardless of their position, are responsible for compliance with the principles and requirements of the Company’s Anti-Corruption Policy, as well as for the actions (inactions) of persons subordinate to them that violate these principles and requirements.

6.2. Measures of responsibility for corrupt practices in the Company include: measures of criminal, administrative, and disciplinary liability in accordance with the legislation of the Russian Federation, and measures of corporate action in accordance with the legal acts of the Company.

6.3. The Company has the right to conduct internal investigations into every reasonable suspicion or established fact of corruption within the limits permitted by the legislation of the Russian Federation.

7. FINAL PROVISIONS

7.1. The Anti-Corruption Policy is approved by the General Director of the Company and comes into force from the moment the order for its implementation is issued.

7.2. Upon identifying insufficiently effective provisions or upon changes in the requirements of applicable legislation of the Russian Federation, the Company organizes the development and implementation of an action plan to update the Company’s Anti-Corruption Policy.

7.3. Amendments and additions to the Company’s Anti-Corruption Policy are made by preparing a draft of the Company’s Anti-Corruption Policy in a new edition and approving it in the established manner.