Until the credit crisis of 2008 an estimated one third of all hedge fund assets were allocated via Switzerland. But also after the crisis, Switzerland remains one of the most important destinations for hedge funds and alternative investment managers. However, as of March 2015, substantial changes to the rules for distributing investment funds (CISA) to Swiss investors came into force.
The new rules leave no room for manoeuvre: While in the past, foreign funds could be distributed easily via private placement, today all foreign managers wanting to market to any Swiss pension, family office, HNI or independent wealth manager are required to designate a Swiss Representative and a Paying Agent (bank). This representation is now a mandatory compliance function while "reverse solicitation" has become almost impossible to demonstrate in practice and is not an option.
The good news is that the industry has found that compliance with CISA and the process of on boarding a Swiss Rep and Paying Agent is a lot easier and more painless than anticipated. In fact, over 1000 foreign managers have already designated a Swiss Representative. This is almost the double than the approximately 600 firms who so far have qualified as AIFM within the European Union's directive. With Switzerland being outside of the EU, AIFM compliance is not required for domestic distribution.
Hear Anne Simond, founder and CEO of ARM Swiss Representatives talk about:
• Why foreign funds find it much easier to comply with Swiss than EU distribution requirements
• The Role and Functions of the “Swiss Rep” and the Paying Agent
• Requirements to market to Swiss pensions, family offices, HNI and independent wealth managers
• Investor Classification: the one remaining challenge for foreign funds
Anne Simond is a qualified English solicitor with almost 20 years in alternative investment industry. She has extensive experience in legal, compliance and product development for alternative asset managers as well as legal and structuring expertise for derivative products in investment banking. Anne held various senior legal positions with such firms as EIM, UBP, Credit Suisse and Morgan Stanley. She has a Master of Law from the Université des Sciences Sociales in Toulouse and is also a founding member of the Geneva chapter of 100 Women in Hedge Funds