A portfolio manager is a person mandated to manage assets on a commercial basis in the name of and on behalf of clients or who may dispose of clients’ assets in any other manner (Art. 17 FinIA). Portfolio managers manage individual portfolios.
Managers of collective assets who manage the assets of collective investment schemes or occupational pension schemes below the defined thresholds (see Art. 24 para. 2 FinIA) are also deemed to be portfolio managers.
A trustee is a person who on a commercial basis manages or disposes of a separate fund for the benefit of a beneficiary or for a specified purpose based on a restricted grant given namely in the instrument creating a trust within the meaning of the Hague Convention of 1 July 1985 on the Law Applicable to Trusts and on Their Recognition. The trustee manages the separate fund, ensures its value is maintained and employs it in a restricted manner.
Portfolio managers and trustees must be authorised by FINMA.
PMs and trustees who started their commercial activity before 1 January 2020 must submit a request for authorisation to FINMA before the end of 2022. They can continue to operate until a decision is reached regarding their authorisation, provided that they are affiliated to a self-regulatory organisation (SRO), as defined in Article 24 of the Federal Act on Combating Money Laundering and Terrorist Financing (AMLA), and are supervised by this SRO in relation to compliance with the relevant requirements.
PMs and trustees who commenced operations in the course of 2020 must meet the authorisation conditions from the date on which they commenced operations, with the exception of the requirement to affiliate to a supervisory organisation (SO). They must be affiliated to an SO by 6 July 2021 at the latest and submit a request for authorisation to FINMA. They can continue to operate until a decision is reached regarding their authorisation, provided that they are affiliated to an SRO, as defined in Article 24 AMLA, and are supervised by this SRO in relation to compliance with the relevant requirements.
The FinIA recognises two categories of managers of collective assets, namely managers of the assets of occupational pension schemes and managers of the assets of collective investment schemes.
Managers of the assets of collective investment schemes who were not previously subject to the CISA because they did not reach the thresholds specified in the CISA now have to be authorised by FINMA as portfolio managers or PMs (see Art. 24 para. 2 let. a FinIA).
They must meet its requirements by the end of 2022 and submit a request for authorisation. They can continue to operate until a decision is reached on their authorisation, provided that they are affiliated to an SRO, as defined in Article 24 AMLA, and are supervised by this SRO in relation to compliance with the relevant requirements.
Portfolio managers of occupational pension schemes who were previously authorised by the OPSC now require authorisation from FINMA as managers of collective assets provided that they manage occupational pension scheme assets of more than 100 million francs or manage more than 20% of the assets of an individual occupational pension scheme (see Art. 24 para. 2 let. b FinIA).
If these portfolio managers manage occupational pension scheme assets amounting to no more than 100 million francs and no more than 20% of the assets of an individual occupational pension scheme (see Art. 24 para. 2 let. b FinIA), they now require authorisation from FINMA as portfolio managers.
Institutions which are already authorised as securities dealers (as defined in Art. 2 let. d SESTA) when the FinIA enters into force will not require any new authorisation as investment firms. They must, however, meet the requirements of the FinIA within one year of its entry into force.
Apart from foreign fund management companies, foreign financial institutions may establish branches and representative offices in Switzerland.
Pursuant to Art. 52 para. 1 FinIA, FINMA authorisation is required for financial institutions based abroad (foreign financial institutions) wishing to establish a branch in Switzerland in which they employ persons who regularly perform the following functions on a commercial basis in the name of the foreign financial institution in Switzerland or from Switzerland:
a. manage assets or act as a trustee;
b. manage the assets of collective investment schemes or pension schemes;
c. trade in securities;
d. conclude transactions; or
e. maintain customer accounts.
Representative officeForeign financial institutions require FINMA authorisation if they employ persons in Switzerland who work for them permanently and on a professional basis in Switzerland or from Switzerland in a manner other than in accordance with Article 52 paragraph 1 FinIA, in particular by forwarding client orders to them or representing them for commercial or other purposes.
Financial institutions that have their registered office abroad and by reason of a branch or representation in Switzerland have become subject to an authorisation requirement must notify FINMA within six months of the FinIA coming into force. This notification takes place exclusively via a registration form available on the EHP survey and application platform.
These Financial institutions must self-register to gain access to the EHP. They can do this via the FINMA homepage. Following self-registration and the review by FINMA, they will be able to access the EHP through the FINMA portal via two-factor identification.
Institutions which are already authorised as fund management companies (as defined in Art. 13 para. 2 let. a CISA) when the FinIA enters into force will not require any new authorisation. They must, however, meet the requirements of the FinIA within one year of its entry into force.
With the entry into force of the revi sed CISA, the obligation to appoint a representative and a paying agent will no longer apply to foreign collective investment schemes offered exclusively to qualified investors in Switzerland. Only foreign collective investment schemes which are offered in Switzerland to non-qualified investors or qualified investors in accordance with Art. 5 para. 1 FinSA (professional clients) must continue to appoint a representative and paying agent in Switzerland.
For representatives representing exclusively foreign collective investment schemes which are offered in Switzerland only to qualified investors, but not to professional clients pursuant to Art. 5 para. 1 FinSA, the authorisation requirement and thus the FINMA licence will cease to apply when there is compliance with the conduct and organisational requirements of FinSA (Art. 105 para. 3 let. e and Art. 106 para. 3 let. 3 FinSO).
However, individuals who provide financial services on behalf of their institution must register as client advisors in an advisor register.
The provisions relating to distributors of collective investment schemes in the CISA will be deleted in their entirety. Once the FinIA enters into force, the corresponding authorised entities will no longer be subject to supervision by FINMA. Distributors, like all other financial service providers, will have to comply with the new code of conduct provisions as set out in FinSA and may also have to add their names as client advisers to an adviser register.