Withdrawal of authorisation, liquidation and bankruptcy

FINMA can withdraw its authorisation of individuals and legal entities that no longer meet the authorisation requirements or have committed serious violations of supervisory law. The law requires certain licence holders to be liquidated when this happens. FINMA also applies these rules to financial market participants operating without the requisite authorisation.

FINMA does not have to issue a formal warning before withdrawing its authorisation, after which the activities it covered must be stopped. However, its actions must always be proportionate.

When FINMA withdraws authorisation under Article 33 ff BA due to insolvency or determines that a company is overindebted in statutory liquidation proceedings, it opens bankruptcy proceedings against the company and appoints a liquidator.

Unauthorised financial market participants

FINMA most often applies the legal provisions on withdrawing authorisation (as appropriate) to unauthorised financial market participants. Companies that then fail to meet the authorisation requirements are liquidated. Depending on the company’s financial situation, this may be done in accordance with the Swiss Code of Obligations or through bankruptcy liquidation.

Where a number of companies have been involved in the same unauthorised activity, they can be treated as a group for the purposes of supervisory law, depending on the extent to which their staff, finances and organisations are interlinked. The provisions on withdrawing authorisation apply to all companies in such cases.

Information for creditors

FINMA publishes notices about statutory liquidations, resolution and bankruptcy proceedings it conducts and supervises on an ongoing basis.