SBA statement concerning the FINMA Position Paper on "Regulation of the production and distribution of financial products"

  • The SBA is in favor of an appropriate, practical form of investor protection; however, it was surprised by the contents of the Position Paper. The majority of the comments from the consultation process were not taken into account. As such, the Position Paper is not oriented at practical needs, and is to a large extent less differentiating than the original distribution report.
  • The Position Paper largely assumes that clients are vulnerable and badly informed, and it underestimates the degree to which they are responsible for their own actions.
  • One unhelpful aspect of the Paper, for example, is the requirement for comprehensive product documentation for all standardised financial products offered in Switzerland (particularly equities and bonds), including details on producers, involved third parties and the products themselves, which must, however, remain concise and understandable. The content of the product documention should be defined on a product-specific basis at a self-regulatory level; this is an approach that has been successful in the past. Strict legal regulations stifle product innovation.
  • In pursuing a sustainable strategy of professionalization and improvement of quality standards, specialized, highly educated and well trained staff benefit the financial centre. Any potential measures must take into consideration the diversity in client advisory services.
  • The SBA welcomes the creation of a financial services act. Such an act must be in accordance with international standards and ensure the same conditions of competition for all financial service providers.
  • The SBA also welcomes that independent assets managers shall become subject to supervision by FINMA and must comply with the same due diligence obligations, codes of conduct and requirements with respect to education and training as supervised financial intermediaries.
  • The SBA will now examine the Position Paper more closely.