SWITZERLAND Law and Practice Contributed by: Nicolas Béguin, Joseph Merhai, Thomas Pasquier and Benjamin Vignieu, Aegis
Investment Companies Not Governed by CISA Article 2, para 3 of CISA provides for some exceptions whereby an investment company is not governed by CISA, and in particular is not considered as a SICAF. The first exception is an investment company in the form of a Swiss limited company ( société anonymeAktiengesellschaft ), the shares of which are listed on a Swiss exchange. The second exception requires the fulfilment of two cumulative conditions: • only qualified investors are shareholders of the investment company and are entitled to participate in the company; and • the shares of the investment are registered shares. The notion of qualified investors is important for investment companies in order to determine whether the second exception above can apply. This notion is introduced in CISA and is specifi - cally defined by Article 10, paras 3 and 3ter to encompass four types of qualified investors: • professional clients pursuant to Article 4, para 3 and 5 of FinSA; • institutional clients pursuant to Article 4, para 4 of FinSA; • retail clients who opted out in accordance with Article 5, paras 1 and 2 of FinSA; and • retail clients with an asset management or investment advice agreement (Article 10, para 3ter CISA). In addition, Article 2, para 2, lit a–g of CISA pro - vide for seven types of entities that are not gov - erned by CISA.
This is particularly the case for operating compa - nies that are engaged in entrepreneurial activities pursuant to Article 2, para 2, lit d of CISA. For the purpose of applying CISA and irrespective of their legal status, such operating companies meet the following requirements: • they have either their registered office as defined by their articles of association or their actual registered office in Switzerland, or are established in Switzerland if their registered office as defined by their articles of associa - tion is located in another state; • they pursue their activities on a commercial basis or on a scale that requires commercially organised business operations; and • their main purpose is the management of a services, production or trading business (Arti - cle 1b, para 1 CISO). In particular, operating companies are compa - nies that: • develop or construct real estate; • produce, buy, sell or exchange goods and commodities; or • offer other services outside the financial sec - tor (Article1b, para 2 CISO). Another noteworthy exception is investment clubs whose members are in a position to man - age their financial interests themselves (Article 2, para 2, lit f CISA). Such clubs, irrespective of their legal status, must meet four requirements: • the membership rights are set out in the relevant constitutive document for its chosen legal status; • the members or a section of the members take the investment decisions; • the members are informed about the status of the investments on a regular basis; and
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