{
    "type": "ETF",
    "ucits": true,
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": false,
    "inverse": false,
    "complex_factors": [],
    "classification": "non-complex",
    "supporting_data": "The HSBC Japan Sustainable Equity UCITS ETF is classified as non-complex under MiFID II for the following reasons: 1) It uses physical replication (as confirmed in the monthly factsheet) with no synthetic replication or swap-based strategies. 2) The KIID explicitly states the fund may use derivatives for efficient portfolio management (up to 10% in total return swaps) but this is not expected to exceed 5%, which is well below the threshold that would typically trigger complexity classification. 3) There is no leverage, inverse exposure, or capital protection features. 4) The underlying index (FTSE Japan ESG Low Carbon Select Index) is a straightforward equity index with no complex derivatives or structured products. 5) The risk profile is clearly communicated as category 6 (higher risk) but this is consistent with equity market exposure. 6) The fund is UCITS-compliant and has a transparent, liquid structure. While the KIID mentions potential derivative usage, the actual implementation appears to be minimal and for risk management purposes only, not as an inherent part of the investment strategy. The monthly factsheet confirms physical replication is used, further supporting the non-complex classification.",
    "confidence": 95
}