Portfolio managers are persons who are eligible to accept assets belonging to others on the basis of a power of attorney, and who carry out this activity on a commercial basis, or who manage the assets of collective investment schemes or occupational pension schemes below the defined thresholds. Portfolio managers require a licence from FINMA before they commence their commercial activities.
The same applies to trustees, who on a commercial basis manage or hold a separate fund for the benefit of the beneficiaries or for a specified purpose based on the instrument creating a trust. Trustees also require a licence from FINMA before they commence their commercial activities.
A detailed description of the licensing process can be found here. Transitional provisions apply for portfolio managers and trustees who commenced their activity on a commercial basis before 1 January 2021.
FINMA will grant a licence if portfolio managers and trustees meet the legal requirements. These are set out in the Financial Institutions Act (FinIA), the Financial Institutions Ordinance (FinIO) and the FINMA Financial Institutions Ordinance (FinIO-FINMA). Further details can be found on the ‘Portfolio managers’ and ‘Trustees’ pages.
Portfolio managers and trustees must meet a number of personal, financial and organisational requirements. In particular, they are required to provide proof that they are domiciled in Switzerland, are suitably organised, and have adequate financial guarantees.
Moreover, members of the body responsible for management or of the body responsible for governance, supervision and control must be able to provide a guarantee of irreproachable business conduct, enjoy a good reputation and hold the required professional qualifications.
FINMA assesses enquiries from individuals and legal entities with regard to whether the intended business activities require a licence and are therefore subject to supervision. This involves appraising the legal aspects of a specific case before a licence application is submitted.
These assessments generally incur a fee. Enquiries should be addressed to the Authorisation section of FINMA’s Asset Management division.
A supervisory organisation (SO) is responsible for ensuring portfolio managers and trustees comply with licensing requirements. The SO is licensed and supervised by FINMA. Portfolio managers or trustees within domestic group companies are exempt from this rule, as they can be exclusively supervised by FINMA within its group supervision role once they have obtained their licence.
The statutory licensing requirements must be complied with at all times. Licensed portfolio managers and trustees must report any change in circumstances that affects their FINMA licence. There are two different types of changes.
In the case of significant changes, prior approval from FINMA is required. Significant changes include:
The relevant form on the EHP survey and application platform contains additional explanations. The licence change process is essentially the same as the licensing process. First, a licence change request must be sent to the supervisory organisation (SO) and a response obtained. In the request, portfolio managers and trustees must specify the nature of the changes involved, describe the changes and the reasons for them, and submit the relevant documents. The response from the SO should then be submitted to FINMA via the EHP together with the licence change request.
If the changes are not significant, they can be reported to the supervisory organisation, which periodically forwards the information to FINMA.