Disclosure of shareholdings

FINMA is responsible for enforcing the duty to disclose shareholdings in listed companies. It also reviews the recommendations made by the exchanges’ disclosure offices when investors request preliminary decisions and exemptions to (or simplified) disclosure requirements.

The Financial Market Infrastructure Act (FinMIA) requires significant shareholdings in listed companies to be disclosed. FINMA has issued implementing provisions for this disclosure obligation in its FINMA Financial Market Infrastructure Ordinance (FinMIO-FINMA). Exchanges must operate a disclosure office (DO) to monitor compliance.

Investigations and enforcement proceedings

FINMA investigates suspected violations of the disclosure obligation based on information received from the disclosure offices, listed companies or third parties. When the facts are clear, it files a criminal complaint directly with the Federal Department of Finance (FDF); otherwise it first conducts written inquiries involving investors and / or banks in and outside Switzerland.

FINMA then decides whether to open proceedings under supervisory law. It normally does so if

  • market integrity is significantly and persistently compromised;
  • institutions subject to prudential supervision are involved in severe violations of supervisory law;
  • disclosure requirements were deliberately violated, for example in connection with a takeover bid.

Possible measures

Where necessary, FINMA can suspend voting rights or ban further purchases by individuals and companies suspected of violating the disclosure requirements until the facts are clear or the requirements are met. Other enforcement instruments include issuing declaratory rulingsconfiscation or ordering the disgorgement of profits and publication of final rulings. However, the full range of enforcement instruments set out in Articles 29-37 FINMASA can be applied at all times to institutions such as banks and securities dealers that are subject to prudential supervision. This involves appointing investigating agents and / or issuing individuals with an industry ban.

The vast majority of cases, however, end in a criminal complaint to the FDF with no prior supervisory proceedings.

Review of disclosure office recommendations

Investors can ask the disclosure office (DO) for a preliminary decision as to whether or not disclosure requirements apply or whether they can be granted an exemption to (or simplified) requirements. The disclosure office responds to such requests with recommendations, which FINMA reviews. FINMA takes action and issues a ruling if

  • it wants to decide on the matter itself;
  • the investor who requested the recommendation rejects it or does not follow it;
  • the disclosure office asks FINMA for a decision.

FINMA rulings supersede the disclosure office’s recommendations and can be contested before the Federal Administrative Court, whose decision can in turn be appealed before the Federal Supreme Court.