Assets And Investment Advisory

Anyone who manages or is responsible for the safekeeping of assets held in collective investment schemes or who represents foreign collective investment schemes in Switzerland or manages assets of occupational pension schemes on a commercial basis must be authorized by FINMA to do so (Art. 5 para. 1 FinIA / Art. 13 para. 1 CISA). The following are required to obtain authorization:

Authorization Requirements

Fund management companies

1. It must be organized as a limited company with its registered office and administrative center in Switzerland.
2. It must meet the minimum capital requirements.
3. The board of directors must have at least three members.
4. The share capital must be divided into registered shares.
5. The company must have an organization appropriate to its role.
6. Those responsible for managing the fund management company must be independent of the custodian bank, and vice versa.

Managers of Collective Assets

1. It must have the legal form of a commercial enterprise.
2. It must have an organization that is appropriate to its role.
3. It must have the required minimum capital and further collateral.
4. The articles of association, partnership agreement, or organizational rules must include a factually and geographically accurate description of its proposed operations.
5. It must manage at least one collective investment scheme or the assets of at least one occupational pension scheme.

Investment Companies with Variable Capital (SICAVs)

1. SICAVs must have assets of at least CHF 5m one year after launch.
2. The company’s name must contain a description of its legal form or the abbreviation “SICAV”.
3. The ratio of company shareholder deposits to total assets must be appropriate.
4. Company and investor shares which do not have a nominal value and are freely transferable must be fully paid up in cash.
5. Investment regulations must be defined.
6. A custodian bank must be designated.
7. The SICAV must choose to be either self-managed (i.e. it handles its own administration and may delegate portfolio management activities) or externally managed (i.e. it delegates both administration and portfolio management activities).
8. Its sole object is to manage its funds/sub-funds.
9. It is prohibited from providing services to third parties in accordance with Arts. 26 and 34 FinIA.
10. It must hold a defined quantity of equity capital.

Investment Companies with Fixed Capital (SICAFs)

1. The ratio of equity capital to total assets must be appropriate.
2. The company’s name must contain a description of its legal form or the abbreviation “SICAF”.
3. Shares must be fully paid up.
4. The issuing of voting shares, participation certificates, dividend right certificates, and preference shares is prohibited.
5. The key provisions concerning investments, investment policy, investment restrictions, and risk diversification, etc. must be set out in the articles of association and the investment regulations.
6. A custodian bank must be designated.
7. An audit firm must be appointed.
8. The company may only manage its own assets.
9. The main purpose of the company must be to generate returns and/or capital gains and not to engage in business activities as such.
10. It is prohibited from providing services to third parties in accordance with Arts. 26 and 34 FinIA.
11. The minimum deposit on foundation must be at least CHF 500,000 in shares, fully paid up.

Limited Partnerships for Collective Investment Schemes (LP)

1. A general partner must be constituted as a limited company with its registered office in Switzerland and must act solely for one LP (unless we are authorized to operate as asset managers of collective investment schemes).
2. General partners must have paid-in capital of at least CHF 100,000.
3. Limited partners must be qualified investors as defined in Article 10 para. 3 and para. 3ter CISA (Art. 98 para. 3 CISA).
4. The partnership exists as soon as it appears in the Commercial Register.
5. The partnership’s name must contain a description of its legal form or the abbreviation “LP”.

Custodian Banks of Collective Investment Schemes

1. It must be a bank in accordance with the Banking Act.
2. It must have an organization that is appropriate to its role as a custodian bank of collective investment schemes.
3. The persons entrusted with the management and with the tasks of the custodian bank must provide the guarantee of irreproachable business conduct.
4. The custodian bank’s staff must have the specialist qualifications required for Our functions.
5. It must have at least three full-time equivalent positions with signatory powers for its activities as a custodian bank.
6. Those responsible for managing the fund management company must be independent of those managing the custodian bank, and vice versa.

Representatives of Foreign Collective Investment Schemes

1. Minimum capital and collateral (Art. 131 CISO).
2. Professional indemnity insurance (Art. 132 CISO).

Licensing Process of Asset Managers

The licensing process roughly consists of the following steps:

1. Registration on the FINMA platform (online tool)
2. Completion of the application questionnaire (in the online tool)
3. Affiliation with a supervisory organization
4. Submission of the licensing application via online tool
5. Preliminary assessment by the supervisory organization
6. Assessment by FINMA
7. Decision

For more information, please contact Neptune Fiduciaries at info@neptunecorporate.com or sales@neptunecorporate.com.