Impact of Covid-19 on Financial Service Providers such as Asset Managers and providers of financial instruments

The coronavirus is on everyone's lips and worldwide parliaments, governments and authorities pass laws and regulations and other publications about it. As of 27 March 2020, on the ESMA website alone, 28 publications on COVID-19 can be found here.



When do I have to do a suitability test and what does exactly need to be assessed?

The new Financial Services Act (FinSA) and the implementing Financial Services Ordinance (FinSO), which entered into force on 1 January 2020, contain several new duties of conduct for those providing financial services. During the legislative process, of all these new duties, the duty to run a suitability test and the duty to run an appropriateness test caught the most attention. For this reason, our FIDLEG SOLUTION - News 10/2019 dealt with the appropriateness test. This FIDLEG SOLUTION News 02/2020 explains in detail, when a suitability test needs to be done, what exactly needs to be assessed and what the consequences are if this duty is violated.


When do I have to do an appropriateness test and what does exactly need to be assessed?

THE CURRENT STATUS OF THE ACTS AND ORDINANCES

The new Financial Services Act (FinSA) and the implementing Financial Services Ordinance (FinSO), the final version of which is expected to be released on 6 November, 2019 contain several new duties of conduct for those providing financial services. During the legislative process, of all these new duties, the duty to run a suitability test and the duty to run an appropriateness test caught the most attention. For this reason, this FIDLEG SOLUTION News 10/2019 explains in detail, when an appropriateness test needs to be done and what exactly needs to be assessed hereunder.

In a next, separate FIDLEG SOLUTION News, we will analyze as well the suitability test.


Client segmentation according to FinSA

Similar to MiFID II, art. 4 para. 1 of the new Financial Services Act (FinSA) stipulates that all financial service providers under FinSA, including asset managers, have to classify their clients, for whom they provide financial services, such as investment advice or asset management, as follows:

  1. Private clients
  2. Professional clients
  3. Institutional clients (subgroup of professional clients)

The table below provides an overview of the client categorization under FinSA.


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