- Swiss securities exchanges;
- securities dealers;
- public offers for take-overs; and
- the disclosure of shareholdings in a listed company.
The provisions on exchanges and securities dealers are now in force whereas those on take-overs and the disclosure of shareholdings will enter into force around mid-1997. Until now the regulation of Swiss stock exchanges and securities dealing has been governed by the laws of several cantons and there has been no federal law.
Exchanges will need an authorisation under the BEHG and, for this purpose, have to file an application with the Swiss Federal Banking Commission. There is no doubt that the Swiss Exchange will be granted the authorisation.
Under the BEHG, securities dealing requires a prior authorisation from the Swiss Federal Banking Commission. The following activities are regarded as securities dealing:
- the business of a market maker;
- the business of a broker;
- the business of a dealer;
- the business of an underwriter;
- and the derivatives engineering.
The derivatives engineering and the activities of a dealer or underwriter are subject to the BEHG only, however, if the respective institution's activity lies primarily in the financial services area so that industrial enterprises are not subject to the law although they may be important participants in the securities markets.
The BEHG does not apply to agents which only arrange the opportunity to conclude a contract between other parties which enter into the contract in their own names and for their own account (intermediaries). Assets managers are subject to a prior authorisation unless the accounts and deposits are held with third parties and the asset manager is simply entitled to manage those assets by a power of attorney.
Foreign securities dealers, i.e. institutions organised under a law other than Swiss laws, are subject to the requirement of a prior authorisation if they employ personnel in Switzerland which operate a branch or representative office in Switzerland. Therefore, the cross-border marketing activities from offices abroad into Switzerland are not subject to a prior authorisation under the BEHG as long as the activities are not carried out through personnel employed in Switzerland. However, the Federal Banking Commission is empowered to notify such cross-border activity to the competent foreign supervisory authority.
Entities which qualify as securities dealers must register with the Federal Banking Commission until 30 April 1997 and notify this authority of whether they will continue such activity after the transitional period ending on 31 January 1999. Insofar as banks are concerned, their auditors must report to the Swiss Federal Banking Commission whether the bank meets the requirements for an authorisation as securities dealer until 31 July 1997. Institutions which do not apply for an authorisation or do not meet the requirements for authorisation must stop securities dealing by 31 January 1999.
The content of this article is intended to provide general information on the subject matter and is not a legal advice. An individual matter requires legal advice according to the specific circumstances.
