Licensing, supervision, implementation, regulation

FINMA supervises the financial market by issuing licences and monitoring licence holders on an ongoing basis; it also implements measures and - where necessary - uses means of enforcement in the event of a violation of the law. Where authorised to do so, FINMA issues its own regulations.

FINMA supervises the financial market in Switzerland as set out in the Financial Market Supervision Act and other financial market laws for each specific sector of the respective industry.

Licensing

A FINMA licence authorises natural persons and legal entities to engage in financial market activity. Financial market legislation sets out varying levels of strict requirements for the different forms of licensing; these range from a licence with intensive prudential supervision to simple registration with no subsequent ongoing supervision by FINMA.

Supervision

Licensed banks, securities dealers, insurance companies, collective investment schemes and their asset managers and fund management companies are subject to prudential supervision; in other words, they are monitored in a comprehensive, ongoing manner in accordance with a risk-based approach. FINMA’s mandate is to protect creditors, investors and insured persons against the consequences of a company becoming insolvent, unfair commercial practices or unequal treatment. At the same time, FINMA is responsible for ensuring that the financial markets continue to function effectively.

Implementation

If FINMA finds evidence of any violation of supervisory legislation, it will investigate, taking all measures necessary to restore compliance with the law. If required, FINMA will use all the means of enforcement available under administrative law Enforcement to implement supervisory legislation.

Regulation

FINMA is committed to principles-based, internationally compatible regulation. FINMA only regulates where necessary and where expressly provided for by the legislation, such as in respect of low-level technical details or particularly dynamic circumstances.

Cooperation

At the national level, FINMA maintains a constant dialogue with partner authorities, as well as with the supervised institutions and their professional associations. At the international level, FINMA represents the interests of the Swiss financial centre and supervisory system vis-à-vis foreign counterparts by participating ininternational standard setting bodies. FINMA also responds to requests for assistance from foreign supervisory authorities.