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Switzerland: Cooperation on AIF cross-border supervision - 04/12/2012


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Within the framework of the AIFMD (“Alternative Investment Fund Managers Directive”), a co-operation agreement was settled between the European Securities and Markets Authority (“ESMA”) and the Swiss Financial Market Supervisory Authority (“FINMA”) for the supervision of alternative investment funds, including hedge funds, private equity and real estate funds. ESMA has negotiated this agreement on behalf of all 27 EU national competent authorities for securities markets regulation.

This co-operation will apply to Swiss alternative investment fund managers (AIFMs) that manage or market alternative investment funds (AIFs) in the EU and to EU AIFMs that manage or market AIFs in Switzerland. The co-operation covers the cross-border supervision of depositaries and AIFM’s delegates. The agreement will take the form of a Memorandum of Understanding (MoU) between the EU securities supervisors and FINMA.

The key elements of this EU-Swiss co-operation agreement are :

  • the supervision of fund managers that operate on a cross-border basis in the EU and Switzerland ;
  • the exchange of information, the cross-border onsite visits and the assistance in the enforcement of the respective law (i.e. the AIFMD and the Swiss Federal Act on Collective Investment Schemes of 23 June 2006);
  • the sharing of relevant information received from FINMA with other EU authorities, ESMA and the European Systemic Risk Board, provided appropriate safeguards apply ;
  • co-operation agreement between EU and non-EU authorities is a pre-condition of the AIFMD for allowing managers from third countries to access EU markets or perform fund management by delegation from EU managers ; and
  • co-operation arrangements are applicable as from  21 July 2013  and enable cross-border management and marketing to professional investors of alternative investment funds.

The content of the MoU follows the IOSCO Principles on Cross-Border Supervisory Co-operation of 2010, and complements the terms and conditions of the IOSCO Multilateral MoU Concerning Consultation and Co-operation and the Exchange of Information of 2002.

ESMA is currently in contact with other non-EU authorities that are members of IOSCO, and is continuing to negotiate co-operation arrangements with the relevant authorities with of having these in place before July 2013. According to the AIFMD, the fund industry from a non-EU country whose securities regulator does not have such co-operation arrangements in place by July 2013 will not be permitted to offer or manage AIFs in the EU.

Here’s a link to the joint ESMA-FINMA press release :

http://www.esma.europa.eu/system/files/press_release_esma_finma.pdf

We trust this information is of assistance and remain at your disposal for any further questions.

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Michael John Flynn
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Deloitte Luxembourg
Job Title:
Directeur - Regulatory Consulting
Phone:
+352 451 452 060
Email
mjflynn@deloitte.lu

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