Press release

Changes in the asset management industry

Developments in Switzerland and abroad are increasing the pressure for institutional asset management industry to be subject to supervision. Currently, only asset management activities of Swiss collective investment schemes are subject to mandatory prudential supervision in Switzerland. There is no mandatory prudential supervision for other asset management activities; voluntary submission is only possible for foreign collective investment schemes under restrictive conditions. Many asset managers are therefore seeking to obtain licences by pro forma launches of statutory supervised activities, a practice which FINMA cannot support.

International standards in institutional asset management have risen following the global financial crisis. For instance, in June 2009 the International Organization of Securities Commissions (IOSCO) Final Report on Hedge Funds Oversight stated that hedge fund managers should be supervised worldwide. Various foreign regulatory proposals also call for all managers of collective investment schemes to be supervised for the first time. By way of example, in the Dodd-Frank Wall Street Reform and Consumer Protection Act the USA has introduced compulsory registration for managers of certain collective investment schemes that were previously not supervised. The new EU Alternative Investment Fund Managers Directive also renders all managers of non-UCITS subject to compulsory supervision.

Equally in Switzerland the pressure on the asset management industry to be subject to supervision is rising. There are increasing demands from clients who wish or are required to work exclusively with supervised asset managers, and regulatory moves have been made seeking to restrict asset management activities to supervised institutions. There are, for example, plans whereby only persons and institutions supervised by FINMA will be allowed to manage occupational pension schemes (seeFINMA Newsletter dated 15 February 2011 on "FINMA's response to the consultation on structural reform to occupational pensions").

Under the Collective Investment Schemes Act, only managers of Swiss collective investment schemes are subject to mandatory supervision, although managers of foreign collective investment schemes may under certain conditions submit to supervision voluntarily. There is no prudential regulation of other asset management activities and no option to be supervised. Where asset managers need supervision (for whatever reasons), they are increasingly attempting to achieve this indirectly by pro forma launching a foreign collective investment scheme. Managing collective investment schemes only represents a marginal part of the business of these institutions, which primarily consists of other asset management activities that are not legally regulated.

FINMA supervises the institutions which come under its regulation on a comprehensive basis, i.e. including unregulated activities. However, it only possesses suitable tools for risk-orientated monitoring in those areas which are legally regulated. It only has restricted abilities to influence permitted but legally unregulated activities conducted by a licence holder. Where these legally unregulated activities are the main activity of a licence holder, FINMA is not able to provide suitable, risk-oriented supervision. However, issuing a licence on the basis of pro forma activities creates the impression in the market that these other activities are regulated, which is not the case. FINMA is therefore unable to supervise asset managers on the basis of pro forma activities knowing that this supervision will contribute to misleading Swiss and foreign authorities and market participants. Instead, a legislative basis must be created that brings previously unregulated activities under supervision.


Tobias Lux, Media Spokesperson, Tel. +41 (0)31 327 91 71,