The Financial Institutions Act entered into force on 1 January 2020 together with the Financial Services Act (FinSA). FinSA governs how financial services are provided to clients; FinIA governs who may provide them as an institution and under which supervision.
Institutions covered
The act sets out a licensing cascade: portfolio managers, trustees, managers of collective assets, fund management companies and securities firms. A licence for a higher level generally covers the activities of the lower ones. Banks remain governed by the Banking Act.
What changed for portfolio managers and trustees
Before 2020, independent asset managers only needed membership of a self-regulatory organisation for AML supervision. Since then they need a FINMA licence and are supervised on an ongoing basis by a supervisory organisation. The licence requires, among other things, an appropriate organisation, qualified management providing assurance of proper business conduct, risk management with a compliance function and minimum capital. The transition periods for existing institutions have expired.
The line to family offices
A single family office managing only one family’s assets may be exempt from licensing because it does not act for third parties within the meaning of the act. Where exactly the line lies depends on who counts as a family member, how the structure is organised and whether services to third parties are added. That question belongs in a legal assessment, not an assumption. A multi-family office serving several families generally requires a licence.
What matters day to day
For licensed institutions FinIA is not a one-off licensing project but an operating model: compliance function, risk management, FinSA conduct rules, AML duties and annual or risk-based audits. Keeping these duties in separate spreadsheets doubles the work; documenting them per mandate passes audits without special effort.