LSerFi and LIsFi are new Swiss federal laws that, for the first time, essentially govern the cross-border supply of financial services provided by Italian suppliers and the creation of Italian-produced financial instruments for customers in Switzerland.
Swiss and Italian financial service suppliers that fall into the LSerFi’s field of application must observe a series of obligations involving information, clientele classification, appropriateness, adequacy and documentation. These financial service suppliers must also abide by organizational obligations, for example, rules for avoiding conflicts of interest and on the subject of retrocession.
The new law also requires that new Italian delegates producing financial instruments to be distributed on the Swiss market are, in turn, subject to a series of obligations. On issuing a public offer of securities, they are essentially obliged to produce a prospectus which must be verified or recognized by a supervisory body.
Financial instrument distribution to private customers is subject to drafting a basic information sheet and even the creation of structured products is bound by a series of rules. In other words, the LIsFi law establishes surveillance rules differentiated by financial institutes (asset managers and trustees, collective asset managers, fund managements and stockbroking firms). The main news is that financial instrument providers that manage assets on behalf of individual customers or insurance institutes, as well as trustees, will be subject to the authorization of the federal, financial market supervisory authority (FINMA).
The latter will refer to an accredited supervisory body. In regard to LSerFi, this law sets rules for all financial service suppliers on the supply of these services and on the financial instrument offer and makes it easier for customers to exercise their rights.
These provisions particularly focus on obligations to inform customers and to collect information regarding them as well as standard requirements regarding a prospectus for all the securities offered to the public or negotiated on a trading platform. LSerFi also obliges financial service suppliers to publish documents with a brief description of the financial instruments being offered to private customers.
The LSerFi and LIsFi laws entered into force on 1 January 2020 with a two-year transitional period, at the same time as the implementing ordinances adopted by the Federal Council.
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