Yves Schepperle, Head of Product Development and Representative Services

Legal solution to support fund distribution

Thu, 17/04/2014 - 14:06

One of the key requirements under the Swiss Collective Investment Schemes Act (CISA) is for all foreign fund providers to appoint a Swiss legal representative and paying agent, even for those funds distributed to qualified investors only. The transition period for this new requirement ends on 1 March 2015.

UBS Fund Services has moved quickly to support fund managers with the establishment of representative services, allowing it to act as the Swiss legal representative for funds marketed both to qualified and non-qualified investors.
 
As Yves Schepperle (pictured), Head of Product Development and Representative Services, is quick to point out, smaller asset managers, in particular those without a local presence in Switzerland, have not yet fully realised the extent to which the country’s private placement rules have been tightened under the revised CISA and “underestimate the license requirements and their duties at the point of sale. We have created a unique offering for fund providers targeting Swiss investors.”
 
In addition to helping with the fund registration process with the Swiss Financial Markets Authority FINMA, UBS will support managers with all the legal, compliance and tax reporting requirements.
 
“A representative needs to respond in a timely and professional manner to any sort of inquiries – e.g. to provide the most recent legal fund documents, such as the prospectus, to investors. Furthermore, a representative will ensure that all distribution activities are in compliance with the applicable law and the relevant guidelines of the Swiss Funds and Asset Management Association (SFAMA). This includes – amongst others – the duty of the distributor to use specific protocols for client visits, appropriate language in marketing material, using disclaimers containing specific information and adding the required Swiss appendix to the sales prospectus or offering memorandum,” explains Schepperle.
 
Using a trusted and recognised organisation will be key for fund managers: “The representative for AIFs may be contacted by investors and FINMA, so fund managers must be comfortable with their chosen representative. As the name of the representative and paying agent will have to appear on any factsheet or presentation and on all legal documents used for Swiss investors, a fund manager should probably choose a well-known and trusted brand in Switzerland,” notes Schepperle.
 
Clients that use UBS Fund Services will benefit from a dedicated team able to take responsibility for all compliance and regulatory matters under Swiss law. Indeed, having access to their own client relationship manager underpins the bank’s one-stop shop approach.
 
Schepperle explains: “We offer a broad range of ancillary services that help fund managers distribute their funds in Switzerland. For instance, we can organise a TER calculation or a TER validation from a ‘Big 4’ audit firm as requested by more and more Swiss pension funds.
 
“In addition, we closely collaborate with UBS Fondcenter, the largest B2B distribution platform in Switzerland and Europe. To summarise, the fund manager should see us as a valuable partner for its distribution activities in Switzerland, rather than an inconvenience imposed on them.”
 
The fact that UBS Fund Services has a global reach is strategically important as it means any manager, anywhere in the world, who wants to distribute into Switzerland will be able to avail of its representative services.
 
 “No matter whether they are based in Europe, the US or Asia, we have people who will provide fund managers with dedicated support and first-class services,” concludes Schepperle. 


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