Asset managers and other financial service providers operate in a highly regulated environment. Licensing, supervision, codes of conduct, anti-money laundering measures, and internal organization are all interrelated and must be consistently implemented in day-to-day business operations. We provide support in interpreting these requirements from a legal perspective and in their practical implementation within business models, client relationships, processes, and corporate organization.
Approval is just the starting point
Asset managers operating on a commercial basis generally require a license from FINMA. However, obtaining a license marks the beginning of ongoing regulatory responsibilities: The licensing requirements must be met on an ongoing basis, changes must be assessed in a timely manner, and the internal organization must be adapted to the actual business model. For independent asset managers, ongoing supervision is generally carried out by a supervisory organization authorized by FINMA.
FINIG and FIDLEG serve different functions
In particular, FINIG governs the requirements for certain financial institutions and their organization. FIDLEG, on the other hand, relates to the provision of financial services and includes, among other things, requirements regarding client segmentation, disclosure, auditing, documentation, and organization. For asset managers, these regulatory frameworks often overlap directly and must be incorporated into processes, client documentation, and internal controls.
The business model and the organization must be aligned
Regulatory requirements cannot be assessed in isolation from the business model. Customer segments, investment processes, delegations, partnerships, compensation models, systems in use, and external service providers all influence the legal classification. A robust compliance structure must therefore reflect the company’s actual operations and be able to scale with its size, risks, and activities.
Changes may have regulatory implications
New services, changes in management, significant changes in ownership, organizational adjustments, or new outsourcing models can have an impact on licensing or ongoing supervision. Therefore, it is important not to assess regulatory implications only after the fact, but to consider them early on when significant changes are made.
For asset managers, particular emphasis is placed on requirements related to organization, risk management, and internal controls; financial requirements; guarantees; and the professional qualifications of the responsible individuals. The scope of business must be clearly defined, and actual operations must align with the approved structures. These requirements must be met on an ongoing basis even after a license has been granted.
Licensed asset managers are subject to ongoing supervision. Relevant changes should therefore be reviewed in a timely manner to determine whether they must be reported to the supervisory authority in advance and, if necessary, additionally approved by FINMA. In day-to-day operations, this applies, for example, to changes in the organization, the persons in charge, the business area, or significant adjustments to control and risk structures.
Anyone who provides financial services must incorporate the applicable FIDLEG obligations into their client processes. Depending on the service and client segment, these include, in particular, information, appropriateness, or suitability assessments, documentation, and accountability. These requirements should be integrated into advisory and investment processes, contractual documents, forms, and internal guidelines.
The classification of clients into retail, professional, and institutional categories affects the scope of various regulatory obligations. Opt-in and opt-out options, informational materials, asset management agreements, and other client documents should therefore be tailored to the specific client structure and the actual service model.
Asset managers and numerous financial service providers are subject to anti-money laundering obligations. These include, in particular, identification, determining the beneficial owner, risk-based due diligence, transaction monitoring, documentation, and internal organization. Increased risks and unusual business relationships must be identified and addressed appropriately.
Regulatory requirements must be embedded in the organization. Responsibilities among the board of directors, executive management, risk management, and compliance should be clearly defined. Depending on the size and business model, special consideration should be given to conflicts of interest, delegation of authority, control mechanisms, and segregation of duties. It is crucial that the documentation aligns with the organization’s actual practices.
Asset managers often rely on external providers of IT, cloud, compliance, portfolio, or administrative services. This gives rise to additional requirements regarding selection, instruction, monitoring, data protection, and information security. Depending on the function, criticality, and institution, additional regulatory requirements regarding controls, access rights, business continuity, and exit strategies must also be taken into account.
The FIDLEG requires financial service providers to be affiliated with a recognized ombudsman office, provided that the legal requirements are met. In addition to the formal requirement for affiliation, it is also important to inform customers about the mediation process. Complaints and disputes should also be integrated into internal escalation and documentation processes.
The first step is to determine which activities are actually performed and what regulatory roles arise from them. This classification forms the basis for licensing, organization, and customer processes.
Regulations, guidelines, risk management, compliance processes, and responsibilities must be aligned with one another. Documents should not merely exist on paper but should reflect the institution’s actual operations.
FIDLEG and GwG requirements must be integrated into onboarding, advisory services, asset management, documentation, and ongoing monitoring. It is important to ensure a consistent link between contracts, forms, and internal processes.
New products, personnel, outsourcing models, or business areas can alter the regulatory landscape. Regular legal reviews and targeted legal compliance audits help to review processes and documentation and to assess significant changes from a regulatory perspective at an early stage.
Findings from audits, inspections, or inquiries by the regulatory authority should not be addressed in isolation. It is often worthwhile to conduct a structural review to determine whether processes, documentation, and responsibilities need to be adjusted.
Regulatory obligations may change as a result of new customer groups, additional services, or partnerships. Growth should therefore be managed not only from an operational perspective but also from a regulatory and compliance standpoint.
Changes to the board of directors, executive management, compliance, or risk management may have implications under licensing and supervisory regulations. In addition to professional qualifications and reliability, representation and the separation of duties play an important role.
New portfolio systems, cloud solutions, automated processes, and external providers drive efficiency but also change risks and control requirements. Contracts, data protection, and governance must keep pace with technological developments.
Findings by audit firms or supervisory bodies may trigger legal, organizational, and operational adjustments. FINMA investigations or other regulatory proceedings also require a consistent analysis of the facts and a clear procedural strategy. Clear prioritization and documented implementation facilitate dialogue with the supervisory authorities.
Institutional and service regulation are considered together because they are closely intertwined in day-to-day operations.
Regulatory documentation is effective only if it aligns with the company's actual organizational structure and operational processes.
When implementing changes and undertaking projects, we consider early on what questions may arise regarding regulatory bodies or FINMA.
Contracts, FIDLEG documentation, AML processes, and internal guidelines are not considered in isolation, but rather within the context of the customer process.
Regulatory requirements should remain manageable and implementable in day-to-day operations without creating unnecessary complexity.
Authorized institutions are evolving. Compliance structures should therefore be adaptable to changes in the organization, technology, and business model.
