Please note that this page provides only general and not exhaustive information, which is subject to amendments and/or additions over time. The Financial Services Act allows financial intermediaries and supervisory authorities two years to develop and adjust their procedures and practices in order to comply with it. For more information about this law, please refer to the Federal Council website.
Objectives and timing
This Act seeks to protect the clients of financial service providers and to establish comparable conditions for the provision of financial services by financial service providers, and thus contributes to enhancing the reputation and competitiveness of Switzerland's financial centre.
To this end, it establishes the requirements for honesty, diligence and transparency in the provision of financial services and governs the offering of financial instruments.
All financial service providers (whether under prudential supervision or not) must apply FinSA as of 1 January 2020, with a maximum 2-year transition period for certain aspects.
Scope
FinSA applies in Switzerland to all professional financial service providers, including banks, and issuers of financial instruments.
Financial services include for example:
- Sale or purchase of financial instruments
- Receipt and transmission of orders on financial instruments
Client classification
FinSA stipulates that clients must be classified in one of the three following categories:
Retail clients
Retail clients are clients who are neither Professional nor Institutional clients (see definitions below). They are given the highest level of protection, which means stricter information requirements for the Bank, but also limited access to certain financial instruments and services.
Professional clients
Professional clients are deemed to possess sufficient knowledge and experience to take investment decisions in full knowledge of the nature and extent of the associated risks, and be able to bear the financial consequences of those decisions. They are afforded limited protection. Among Professional clients are large companies or companies with professional treasury operations.
Institutional clients
Institutional clients are deemed to possess knowledge and experience comparable to that of financial services providers. According to FinSA, the legal rules of conduct, particularly the duty of information by financial intermediaries, are not applicable to these clients. Institutional clients include banks, insurance companies and other financial intermediaries subject to prudential supervision in Switzerland or abroad.
Change of client category classification
Under FinSA clients are entitled to change categories upon written request, provided they meet the conditions.
Change to a category offering a reduced level of protection (Opting Out)
High net worth clients or private investment structures created for high net worth clients without professional treasury operations may request to be treated as Professional clients if:
1. The client or private investment structure
a) owns assets of at least CHF 500,000 and
b) have the necessary knowledge to understand the risks associated with financial investments on the basis of their training, education and professional experience, or on the basis of comparable experience in the financial sector.
Or
2. The client or private investment structure owns assets of at least CHF 2 million
These amounts do not include assets such as real estate, social security claims or pension fund assets.
Swiss or foreign collective investment schemes or their management companies, without prudential supervision, may request to be considered Institutional clients.
Companies and occupational pension schemes and institutions whose purpose is to service occupational pensions may request to be considered Institutional clients provided they have professional treasury operations.
Change to a category offering extended protection (Opting In)
Professional clients may request to be treated as Retails clients and Institutional clients may request to be treated as Professional clients.
Code of conduct
FinSA includes the following conduct rules (note that this is not an exhaustive list, these are the only ones applicable to IG Bank S.A.):
Duty to provide information:
The duty to provide information encompasses factual data relating to the financial service provider as well as information on the financial services it offers.
The financial service provider must inform its clients on:
- Its name and address
- Its field of activity and the supervision to which it is subject
- The option of initiating mediation proceedings before a recognised mediation body
- The general risks associated with certain financial transactions
For these information, please refer to our terms and conditions page.
Retails clients are provided with a key information document (KID) for each FinSA-covered financial instrument recommended to them personally. Each KID contains information on the characteristics, risks and costs of a given financial instrument, allowing easier comparison between financial instruments.
Appropriateness checks
IG Bank S.A: is submitted its client to an appropriateness check at the opening of the account even if this is not required by FinSA. The risks related to Contract for Difference (CFDs) are significant and the product may not appropriate for everyone. For more information about IG Bank S.A. appropriateness check, please refer to our Risk Disclosure Notice.
Duty to document and to report
Financial service providers must document the financial services agreed with clients and the information collected about them.
Transparency and due diligence in the execution of client orders
Financial service providers shall ensure best execution of their clients’ orders, i.e. that the best possible outcome is achieved in terms of cost, timing and quality. For more information on this topic, please refer to our Best Execution page.
This code of conduct rules do not apply for Institutional clients.
