Swiss FINMA issues first licenses to supervisors of portfolio managers and trustees

Maria Nikolova

FINMA has granted OSIF and OSFIN the first licences for organisations, responsible for the supervision of portfolio managers and trustees.

The Swiss Financial Market Supervisory Authority (FINMA) today announces that it has granted the Organisme de Surveillance des Instituts Financiers based in Geneva (OSIF) and the Organisation de Surveillance Financière based in Neuchâtel (OSFIN) licences as supervisory organisations (SOs) with effect from July 6, 2020.

The two organisations submitted their applications to FINMA in January 2020. The SOs will be responsible for the supervision of portfolio managers and trustees. FINMA is currently reviewing three further SO applications, which were submitted later.

With the enactment of the Financial Institutions Act (FinIA) and the Financial Services Act (FinSA) the supervision of portfolio managers and trustees became subject to new regulation. Independent portfolio managers and trustees now require authorisation from FINMA. However, they will be monitored by the SOs with regard to compliance with the obligations laid down in the FinIA and FinSA, as well as compliance with AMLA rules. The SOs also require authorisation from FINMA and will be supervised by FINMA. If there are any violations FINMA is responsible for enforcing financial market law.

The portfolio managers and trustees must apply for a licence from FINMA before the end of 2022 and prove that they are affiliated to a supervisory organisation. They had to notify FINMA by June 30, 2020. By this cut-off date FINMA had received notifications from 1,934 portfolio managers and 272 trustees who are interested in a licence. FINMA adds that 121 institutions have reported that they will not be submitting a licence application since they are either giving up their business or will merge with others.

FINMA also authorised BX Swiss AG as the first registration body for client advisers. The authorization is effective from July 20, 2020. It is to be expected that further registration bodies will be authorised. The registration bodies maintain a register of advisers as defined in the FinSA. Client advisers of financial service providers must register there if they are not subject to supervision and provide their services in Switzerland. The registration bodies will check that the client advisers have completed the necessary training and further education measures.

FINMA is responsible for authorising the registration bodies, but not for their prudential supervision.

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