FinSA and FinIA: the federal architecture

Before 2020: self-regulation under federal oversight

Until the end of 2019 an independent asset manager in Switzerland needed no prudential licence. Federal law reached him through two channels only. As a financial intermediary under the Anti-Money Laundering Act of 1997, he had to join a selfregulatory organisation recognized by the supervisory authority or submit to direct supervision. The self-regulatory organisation then checked his compliance with the duties of identification, clarification and reporting. If he managed collective investment schemes, he needed a licence under the Collective Investment Schemes Act of 2006. Everything else, from the suitability of investments to the handling of retrocessions, was left to the civil law of mandate and to the codes of conduct of the professional associations.¹

FINMA used one instrument to raise the standard of these codes. Its Circular 2009/1 on the "key points of asset management" (Eckwerte zur Vermögensverwaltung) set minimum standards that the self-regulation of the associations had to meet if it was to be recognized as a minimum standard for asset managers. After the Federal Supreme Court's decisions on retrocessions, FINMA revised the circular with effect from 1 July 2013, tightening the rules on the risk profile of clients, on disclosure and on retrocessions, and gave the self-regulatory organisations until the end of 2013 to adapt their codes. FINMA stated that the standard enforced through supervision should not fall behind the standard set by the civil courts.² A further amendment, in force from 1 August 2016, allowed asset management agreements to be concluded in text form, without a handwritten signature.³ In Ticino the cantonal LFid added a third layer for the financial fiduciaries, so that a Lugano manager before 2020 was subject to cantonal licensing, to anti-money laundering supervision by a self-regulatory organisation and to the code of conduct of his association.

The legislative history

The reform that ended this arrangement began with a consultation in the summer of 2014. The Federal Council adopted its dispatch on the Financial Services Act and the Financial Institutions Act in November 2015, and Parliament passed both laws on 15 June 2018.⁴ The referendum period expired unused on 4 October 2018.⁵ The Federal Council adopted the Financial Services Ordinance (FinSO) and the Financial Institutions Ordinance (FinIO) on 6 November 2019 and put the whole package into force on 1 January 2020.⁶ The stated aims were to strengthen client protection, to establish a level playing field for financial services and to create a coherent supervision of asset management. The model was the European Union's MiFID II directive, which had applied since 3 January 2018, although Switzerland did not seek equivalence and the Swiss rules differ in many details, as Chapter E.IV explains for the relationship with Italy.⁷

The reform divided the subject matter between two statutes. FinSA, SR 950.1, governs the conduct of all financial service providers towards their clients, whether banks, securities firms, portfolio managers or unregulated advisers. FinIA, SR 954.1, governs the licensing and prudential supervision of financial institutions. Portfolio managers and trustees form the lowest tier of FinIA's structure. Their supervision is delegated in part to private supervisory organisations licensed by FINMA under Article 43a of the Financial Market Supervision Act (FINMASA).

Notes

1. Federal Act of 23 June 2006 on Collective Investment Schemes (Collective Investment Schemes Act, CISA), SR 951.31, title and date as shown at https://www.droit-bilingue.ch/en-it/9/95/951.31-index.html; AMLA (above), Art. 14, as amended by the Financial Institutions Act of 15 June 2018 with effect from 1 January 2020, https://www.droit-bilingue.ch/en-it/9/95/955.0-14-24.html; Oliver Arter, "The new Financial Institutions Act (FinIA/FINIG) – Impact on the Activities of Trustees", MLL News, 5 October 2018, https://www.mll-news.com/the-new-financial-institutions-act-finia-finig-impact-on-the-activities-of-trustees/ (absence of prudential supervision before FinIA). ↩
2. FINMA, press release "Eckwerte zur Vermögensverwaltung: FINMA passt Rundschreiben an", 27 June 2013, https://www.finma.ch/de/news/2013/06/mm-rs-eckwerte-vermoegensverwaltung-20130627/. ↩
3. FINMA, press release of 1 July 2016 on the amendment of Circular 2009/1, https://www.finma.ch/de/news/2016/07/20160701-mm-rs-09-01/. ↩
4. PwC Legal, FIDLEG/FINIG – Analyse über die Anforderungen des Finanzdienstleistungs- und Finanzinstitutsgesetzes an Finanzintermediäre, 2018, https://www.pwc.ch/de/publications/2018/FIDLEG-FINIG_def_DE.pdf. ↩
5. Oliver Arter, "The new Financial Institutions Act (FinIA/FINIG) – impact on the activities of trustees", MLL News, 5 October 2018 (updated 23 December 2021), https://www.mll-news.com/the-new-financial-institutions-act-finia-finig-impact-on-the-activities-of-trustees/. ↩
6. Ordinance on Financial Institutions of 6 November 2019 (Financial Institutions Ordinance, FinIO), SR 954.11, title and date as shown at https://lawbrary.ch/law/art/FINIV-v2023.01-en-art-24; Financial Services Ordinance of 6 November 2019 (FinSO), SR 950.11, title and date as shown at https://www.droit-bilingue.ch/en-it/9/95/950.11-index.html. ↩
7. Arter (above) on the aims of the reform; Directive 2014/65/EU (MiFID II) of 15 May 2014, title and date as shown at https://eur-lex.europa.eu/eli/dir/2014/65/oj. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.