Swiss Financial Market Law

Swiss Financial Market Law

Our team supports financial service providers in Switzerland regarding compliance with laws and regulations.

Partner, Audit Financial Services

KPMG Switzerland

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Financial Services Act & Financial Institutions Act (FinSA / FinIA and MiFID / MiFIR)

The Markets in Financial Instruments Directive (MiFID) and its delegating legal acts, which are in force since 2007, are currently subject to a fundamental revision. The MiFID II, the successor of the MiFID, is already published and will together with a directly applicable regulation (MiFIR) enter into force in the EU in January 2017. The MiFID II/MiFIR in particular contain conduct and organizational provisions for the distribution of financial instruments and provision on market infrastructure.

In Switzerland the Federal Council published the dispatch regarding the new Federal Financial Services Act (FinIA) and the Financial Institutions Act (FinIA) in November 2015. The FIDLEG, on the lines of MiFID/MiFID II, governs the prerequisites for providing financial services and offering financial instruments. The FINIG introduces a differentiated supervisory regime for financial institutions.

 

What are the challenges involved?

  • The new provisions suggested by MiFID II and FinIA will have an impact on the whole value chain and require a multitude of fundamental strategic decisions
  • Market access to the EEA
  • Reshaping of the distribution model (client classification, suitability)
  • Firm wide convergence of processes and compliance standards, to reduce compliance costs and use synergies


Articles about MiFID can be found on our Expert Blog.

Financial Market Infrastructure Act (FMIA)

FMIA introduces uniform rules governing the organization and operation of the financial market infrastructure, which includes the following institutions: stock exchange, multilateral trading systems, central counterparties, central custodians, transaction registers and payment systems. Additionally, the FMIA imposes new requirements for organized trading systems.

With the enactment of the FMIA on 1 January 2016, Switzerland adapted its financial regulations to changed market conditions and international standards.

 

What are the challenges involved?

  • Impacts of the regulations on financial institutions
  • Clearing obligations
  • Counterparty classification
  • Reportable data
  • Adjustments of existing derivatives contracts
 

Anti-Money Laundering (AML) / Know your Customer (KYC)

The pressure on combating money laundering and terrorist financing in the financial sector has increased considerably in the last few years. The Federal Act on the Implementation of the in 2012 revised Recommendations of the Financial Action Task Force against Money Laundering (GAFI/FATF) entered into force in 2015. Consequently, the Anti-Money Laundering Ordinance-FINMA (AMLO-FINMA) and the CDB08 will be adjusted as well. These amendments will have a direct impact on the compliance with the KYC and due diligence obligations of financial intermediaries as well as on how they will structure underlying processes.

 

What are the challenges involved?

  • Safety measures for a successful combating of money laundering and terrorist financing have to be observed by financial intermediaries.
  • An independent and well-functioning money laundering organization is needed in order to successfully prevent money laundering and avoid reputational risks
  • In order to evaluate the impacts on existing processes and control mechanisms, an impact analysis is necessary
  • Adjustment of account opening processes and extension of the due diligence requirements.
     

Articles about AML can be found on our Expert Blog.

Alternative Investment Fund Managers Directive (AIFMD) / Fund Distribution

On the one hand, the AIFMD addresses the obligation to hold a license and to be supervised, applicable to all EU-domiciled investment fund managers who are not already subject to the UCITS. On the other hand, it regulates access to the EU market for fund managers coming from non-EU member states, such as Switzerland, and defines the conditions under which asset management may be delegated.

 

What are the challenges involved?

Until 2015, Swiss asset managers of collective investment schemes had only access by observing the relevant national laws on private placement. Under certain circumstances, Swiss asset managers may also benefit from the new passport regime from 2015 onwards. In 2018, the EU Commission will then replace these national laws with the EU passport regime. Thus, following challenges are involved:

  • Strategic implications of the AIFMD on product strategies and business models
  • Requirements for Swiss asset managers regarding the management of EU-domiciled collective investment schemes
  • Activities how can Swiss asset managers be active under the national laws on private placement?
  • Should Swiss asset managers incorporate a branch office in the EU?
     

Articles about AIFMD can be found on our Expert Blog.

How can KPMG support you?

The Regulatory Competence Center has a team of specialists who is well versed in financial market law. Thanks to our industry knowledge and experience from many projects we can advise our customers comprehensively and with a view to crucial details.

 

Our range of services in the context of financial market law include:

  • Situation analysis / gap analyzes
  • Impact / Readiness Assessment
  • Assessment of existing and implementation of new processes
  • Development of policies and guidelines
  • Validation of guidelines and benchmarking
  • Assessment of existing operations, processes and organization
  • Improvement of operational and compliance processes
  • Cross-border advise thanks to our global network

Banking

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Regulatory Competence Center

Regulatory Competence Center

Our team offers services linked to regulatory requirements for the FS industry.

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