The regulations applying to the provision of financial services and the offering of financial instruments set out in the FinSA and the licensing and supervision requirements for financial institutions set out in the FinIA must be distinguished.
In principle, there are three constellations in which the FinSA is applicable:
Exceptions to the relatively broad scope of application are defined in the Financial Services Ordinance (FinSO). The scope of financial services provided in Switzerland does not include the following:
In addition, there is no offer of financial instruments within the meaning of the FinSA if the provision of information is made at the instigation of the client and is not preceded by advertising within the meaning of the FinSA by the provider or an agent of the provider in relation to the specific financial instrument.
These exceptions refer to so-called reverse solicitation. In contrast to active solicitation, where a customer relationship is based on the initiative of the financial service provider, the regulation of the home country of a financial service provider should not apply if the customer relationship for individual financial services was initiated by reverse solicitation on the initiative of the customer.
The law does not further specify the criteria for reverse solicitation. In our opinion, the following general criteria can be identified:
In any event, a foreign financial services provider seeking to rely on reverse solicitation to avoid FinSA regulations should clearly document the customer's own initiative. Websites deserve special attention. In general, these must not be trimmed to cater to customers in Switzerland and should contain appropriate disclaimers and filters.
As to the licensing and supervision requirements for financial institutions, these generally apply only if the financial institution is based in Switzerland or has a physical presence in Switzerland. Only if and once the service provider has an actual, permanent presence (a de facto presence suffices) in Switzerland (i.e., representation, branch or subsidiary), it becomes subject to the respective licensing requirements. In this context, however, careful attention needs to be paid to the frequency and regularity of visits to Switzerland for professional purposes and business activities in Switzerland (to prevent FINMA from considering these visits and/or activities as amounting to a de facto presence).
In any case, the distribution of collective investment schemes to retail investors or the offering of insurance in Switzerland is subject to authorization by FINMA. The offering of such investment schemes to opt-out professional investors requires a Swiss representative and a Swiss paying agent. Furthermore, foreign stock exchanges without a registered office in Switzerland must be authorized by FINMA before they can allow Swiss securities dealers to access their facilities.
Finally, the granting or brokerage of consumer loans to Swiss consumers on a cross-border basis requires approval from the relevant cantonal authorities under the Federal Act regarding Consumer Credits.
The offering and intermediation of insurance contracts is subject to Swiss supervision if the policy holder or insured person is domiciled in Switzerland or the insured assets are located in Switzerland. Passporting rights apply between Switzerland and Liechtenstein based on a respective international treaty. An additional treaty was agreed but has not been ratified yet between Switzerland and the UK.