Third country rules under the new Swiss Financial Services Act (“FIDLEG”)
The Swiss Federal Council has opened the consultation period for the new Financial Services Act (commonly known as „FIDLEG“) and the new Financial Institute Act (commonly known as „FINIG“) on June 27, 2014.
The consultation period will end on October 17, 2014 and the final version of FIDLEG is planned to enter into force in 2017.
FIDLEG foresees for the first time cross-border regulations for the import of Financial Services from foreign Financial Services Providers into Switzerland. The new third country rules under the FIDLEG are applicable to any foreign Financial Services Provider rendering Financial Services to Swiss domiciled customers. Any such cross-border provision of Financial Services by foreign Financial Services Providers will trigger a duty to register the foreign Financial Services Provider in the register for foreign Financial Services Providers, unless the foreign Financial Services Provider is in Switzerland already licensed as a Representative Office or Branch and/or the provision of the Financial Services has been requested exclusively by the Swiss domiciled customer (“reverse solicitation principle”). The relevant Relationship Managers employed by the foreign Financial Services Provider must also be entered into the new register for Relationship Managers. The registered Relationship Managers will have to comply with FIDLEG’s behavioral rules, rules regarding assessment of suitability and appropriateness, and documentation and accountability as well as the other applicable behavioral rules under the applicable Swiss financial market legislation. There is also a duty to have sufficient expertise in the area of activity and to engage in continuing education. Both registers are public, but information about entries can only be requested based on individual requests.