SWITZERLAND Law and Practice Contributed by: Judith Raijmakers and Florian Thomas Willi, Loyens & Loeff
tice, Swiss financial institutions (including banks) that interact with EU-based entities or custom - ers may still need to meet DORA standards. This is particularly important for Swiss firms providing IT services to EU subsidiaries, sister companies, or EU-based clients. As a result, many Swiss financial institutions are preparing for increased alignment with DORA’s operational resilience requirements. Swiss financial institutions, including banks, already adhere to stringent IT security and risk management standards set by FINMA. Key guidelines, such as Circular 2018/3 on outsourc - ing and Circular 2008/21 on operational risks, help ensure robust cybersecurity and opera - tional resilience. Finally, Switzerland often aligns its financial reg - ulations with international standards, which may lead to future adoption of similar rules concern - ing operational resilience and cybersecurity. The recent Credit Suisse crisis, which led to an intervention by Swiss authorities and a rescue by way of a merger with the UBS group, has had an impact on the financial marketplace and is likely to trigger changes to the regulatory framework for banks. Following the collapse of Credit Suisse, first legislative steps have already been taken with respect to the regulatory framework applicable to SIBs. It is likely that in the coming years the capital and liquidity requirements for SIBs will further evolve. Further, in December 2023, FIN - MA published a report with the lessons learned from the Credit Suisse crisis. In this report, FIN - 11. Horizon Scanning 11.1 Regulatory Developments
MA calls for an extension of its powers, including the power to impose fines and the authority to publish information on enforcement proceedings on a regular basis. FINMA also sets out that a senior manager regime, similar to that of the UK, may be advantageous in Switzerland. Generally, this call for an extension of powers has been met with criticism. In December 2023, Switzerland and the UK entered into an agreement with respect to rec - ognition of financial services (the Bern Financial Services Agreement). In essence, this agreement provides for the mutual recognition of equiva - lence in terms of national legislation. Further, it aims to strengthen the cross-border market for financial services between the two nations (also with respect to banking and asset manage - ment). The agreement also provides for closer co-operation between Switzerland and the UK in the area of sustainable finance. It potentially pro - vides a template for similar agreements between Switzerland and other non-EU financial centres. The agreement is expected to enter into force in Switzerland in the course of 2025. As mentioned in 7.1 Capital, Liquidity and Relat- ed Risk Control Requirements , the Swiss Fed - eral Council adopted an amendment to the CAO in November 2023. Further, FINMA published five new ordinances to introduce the final Basel III (or Basel 3.1) standards. Both the amendment to the CAO as well as the new FINMA ordinances are expected to enter into force in January 2025. On 19 June 2024, the Swiss Federal Council published a proposed revision of the FinMIA. The draft bill includes extensive amendments to derivatives trading rules, the Swiss market conduct framework, and market infrastructure, such as payment systems, central securities depositories, and trading venues. It also propos -
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