Tag Archives: CapLaw-2018-65

Supervision of Portfolio Managers and Trustees

Under current Swiss law, portfolio managers and trustees are not subject to a comprehensive prudential supervision, a situation that will change under the recently passed new Financial Institutions Act (FinIA). After the Swiss parliament passed the new legislation in June 2018, the Swiss Federal Department of Finance released its draft implementing ordinance (Draft-FinIO) for consultation. Under the new legislation, portfolio managers and trustees will have to apply for a license from the Swiss Financial Market Supervisory Authority (FINMA) and they will be subject to ongoing prudential supervision by new supervisory organizations. The FinIO specifies the license requirements for portfolio managers and trustees, taking into account the nature of these businesses and providing a certain amount of flexibility with respect to the requirements to be fulfilled by smaller businesses. While the new rules will come as a challenge for many of the existing portfolio managers and trustees, the FinIA and the FinIO also provide for transitional periods allowing these existing portfolio managers and trustees to transition gradually into the new regulatory regime.

By Patrick Schleiffer / Patrick Schärli (Reference: CapLaw-2018-65)