Swiss Representation Company
As Switzerland is not in the EU, the distribution of shares is not governed by either the UCITS Directive for retail funds) or the AIFM Directive (for alternative funds) Directives, but rather by specific new legislation and regulations, namely
- The Swiss Collective Investment Schemes Act; and
- The Swiss Collective Investment Schemes Ordinance (together the Rules).
The requirements imposed on managers and their funds depend largely on the type(s) of investors the distribution is aimed at and the Rules identify three distinct investor categories:
- Regulated qualified investors, which includes Swiss regulated financial institutions and Swiss regulated intermediaries;
- Unregulated qualified investors which include certain high net worth individuals (HNWI), pension funds, public entities and corporate bodies with professional treasury management functions; and
- Non-qualified investors, essentially retail investors.
The rules governing the distribution of shares to category 1 investors are not changing in the new Rules and remain light, with no specific additional requirements. This category, however, is very specific and it is unlikely that many foreign funds would wish to restrict themselves to just such investors.
The Swiss market has traditionally been an important one for many managers and the introduction of the new Rules are likely to further open up this market to the managers of foreign funds.
Given these developments, Custom House has established a formal relationship with a Swiss entity that is authorised to provide Representative Agent and Distributor Services to managers seeking to distribute in the Swiss market. It can also advise and assist on all other matters required to comply with the Rules.
 The Rules concern the distribution of shares and, for this purpose, refers to the making of an offer to subscribe for shares or any means of marketing, the objective of which is to procure an investment in a specific fund. Therefore, providing even generic material about a fund or its manager may be considered distribution.