HSBC France € 20,000,000,000 Euro Medium Term Note Programme

No limitation on issuing or guaranteeing debt ranking senior or pari passu with the NotesThere is no restriction on the amount of debt which the Issuer may issue or guarantee. The Issuer andits subsidiaries and affiliates may incur additional indebtedness or grant guarantees in respect ofindebtedness of third parties, including indebtedness or guarantees that rank pari passu or senior to theobligations under and in connection with the Notes. If the Issuer's financial condition were todeteriorate, the Noteholders could suffer direct and materially adverse consequences, including loss ofinterest and, if the Issuer were liquidated (whether voluntarily or not), the Noteholders could suffer lossof their entire investment. In addition, the Notes do not contain any "negative pledge" or similar clause,meaning that the Issuer and its subsidiaries and affiliates may pledge its or their assets to secure otherobligations without granting similar securities in respect of the Notes.3. Risks related to Notes generallySet out below is a brief description of certain risks relating to the Notes generally:Modification of the ConditionsExcept as otherwise provided by the relevant Final Terms, the Noteholders will, in respect of allTranches in any Series, be grouped automatically for the defence of their common interests in a Masse,as defined in Condition 12, and a General Meeting can be held. The Terms and Conditions permit incertain cases defined majorities to bind all Noteholders including Noteholders who did not attend andvote at the relevant General Meeting and Noteholders who voted in a manner contrary to the majority.The General Meeting may deliberate on any proposal relating to the modification of the Conditionsincluding any proposal, whether for arbitration or settlement, relating to rights in controversy or whichwere the subject of judicial decisions, as more fully described in Condition 12.TaxationPotential purchasers and sellers of the Notes should be aware that they may be required to pay taxes orother documentary charges or duties in accordance with the laws and practices of the country where theNotes are transferred or other jurisdictions. In some jurisdictions, no official statements of the taxauthorities or court decisions may be available for the tax treatment of financial instruments such as theNotes. Potential investors cannot rely upon the tax summary contained in this Base Prospectus butshould ask for their own tax adviser’s advice on their individual taxation with respect to the acquisition,holding, sale and redemption of the Notes. Only such adviser is in a position to duly consider thespecific situation of the potential investor. This investment consideration has to be read in connectionwith the taxation sections of this Base Prospectus.EU Savings DirectiveOn 3 June 2003, the Council of the European Union adopted the Directive 2003/48/EC regarding thetaxation of savings income in the form of interest payments (the Savings Directive). The SavingsDirective requires Member States, as from 1 July 2005, to provide to the tax authorities of otherMember States details of payments of interest and other similar income within the meaning of theSavings Directive made by a paying agent within their jurisdiction to (or under certain circumstances tothe benefit of) an individual resident in another Member State or certain limited types of entitiesestablished in another Member State, except that Luxembourg and Austria are instead required tooperate a withholding system for a transitional period unless the beneficiary of interest payment electsfor the exchange of information.If a payment were to be made or collected through a Member State which has opted for a withholdingsystem and an amount of, or in respect of tax were to be withheld from that payment, neither the Issuernor any paying agent nor any other person would be obliged to pay additional amounts with respect to37