SWITZERLAND Law and Practice Contributed by: Jürg Frick, Luca Dal Molin, Philippe Gobet and Carla Bertossa, Homburger
2.4 Tax Regime for Funds Direct Taxes
FinSA must include a “Swiss wrapper” in their pro - spectus, which contains information on the Swiss representative and paying agent, among other Swiss- specific information. Publication and exemptions The prospectus and the KID may be published in newspapers or in the Swiss Official Gazette of Com - merce, by free-of-charge distribution in printed form at the issuer’s registered office or from the office involved in the issue, or in electronic form on the issuer’s web - site or on the websites of other specified entities (eg, the trading venue). Prospectuses of AIFs must be published in one single document. AIFs structured as an L-QIF are not required to pro - duce a prospectus. In addition, FINMA may in some cases exempt AIFs that are only open to qualified investors from the prospectus requirement. Other Disclosures In addition to the prospectus and KID, AIFs must make available by law various information to investors as specified in the CISA and the CISO. For example, real estate funds must publish the market value of the fund’s assets and the resulting net asset value of the fund units. The media of publication for this type of information must be specified in the prospectus of the AIF, where - by print media or electronic platforms that are publicly accessible and recognised by FINMA are permitted. Annual and Semi-Annual Report Open-ended AIFs and LPCIs must publish an audited annual report within four months of the end of the financial year and a semi-annual report within two months after the end of the first half of the financial year. Both the annual and semi-annual reports are made available for inspection free of charge to inter - ested parties for ten years. Similar reporting requirements apply to foreign AIFs that are not offered exclusively to qualified investors.
Contractual funds, SICAVs and LPCIs, provided they do not hold direct ownership of immovable prop - erty ( direkter Grundbesitz ), are not subject to private income and wealth tax, nor to corporate income and capital tax, as they are treated transparently for tax purposes. Contractual funds, SICAVs and LPCIs are liable to corporate income and capital tax, and may be subject to real estate gains and transfer taxes, for direct ownership of immovable property. SICAFs are taxed like a corporation (opaque treat - ment). Hence, they are subject to corporate income In contrast to direct taxes, contractual funds, SICAVs and LPCIs are treated as opaque for purposes of with - holding tax. The same applies to SICAFs. Distributions are in principle subject to withholding tax at a rate of currently 35%. Distributions of (i) capital gains, pro - vided they are separately disclosed in the financial statements of the fund, and (ii) income from direct ownership of immovable property are not subject to withholding tax. If at least 80% of the income of a contractual fund, SICAV or LPCI is from a foreign source, the withhold - ing tax liability of foreign investors can be fulfilled by way of a declaration of domicile (so-called affidavit procedure). and capital tax. Withholding Tax Contractual funds, SICAVs and LPCIs that only have domestic qualified investors can fulfil their withholding tax liability by way of notification. Since contractual funds, SICAVs and LPCIs are treat - ed as opaque, they can reclaim Swiss withholding tax based on unilateral Swiss law, provided the income is recorded in the fund accounting. 2.5 Loan Origination In Switzerland, AIFs can engage in loan origination activities, but they must adhere to specific regulatory requirements to ensure compliance with Swiss finan - cial laws. For example, loan origination by funds may trigger licensing requirements under the Swiss Bank -
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