SWITZERLAND Law and Practice Contributed by: Nicolas Béguin, Joseph Merhai, Thomas Pasquier and Benjamin Vignieu, Aegis
tions, and investors in one sub-fund cannot be held liable for the liabilities of other sub-funds (Article 93, para 2 CISA). Similar to investors in SICAVs, the liability of investors in SICAFs is legally limited to their capital contributions. 3.1.4 Disclosure Requirements Please see 2.1.4 Disclosure Requirements , which applies to both AIF and retails funds. 3.2 Fund Investment 3.2.1 Types of Investors in Retail Funds As Swiss CIS do not benefit from a European regulatory “passport” for distribution in the Euro - pean Union, Swiss retail funds typically target Swiss domiciled non-qualified investors. 3.2.2 Legal Structures Used by Fund Managers Please see 3.1.1 Fund Structures for detailed information on the Swiss legal structures used by retail fund managers. 3.2.3 Restrictions on Investors Approved Swiss retail open-ended CIS, approved SICAFs and approved foreign CIS can be marketed to any type of investor, including non-qualified investors. 3.3 Regulatory Environment 3.3.1 Regulatory Regime Investment limitations depend on the classifica - tion of the open-ended funds (securities funds, real estate funds or other funds for traditional investments). Securities funds may invest their assets in secu - rities, derivative financial instruments, units in collective investment schemes, money market instruments, sight or time deposits with a term
to maturity not exceeding 12 months and other investments, provided that it does not exceed 10% of the fund’s total assets (Article 54 CISA and Article 70 CISO). However, investment in precious metals, precious metal certificates, commodities or commodity certificates is pro - hibited, and short selling is not permitted (Art 70, para 2 CISO). Real estate funds may invest in residential buildings, properties that are used exclusively or mainly for commercial purposes, mixed-use buildings used for residential as well as com - mercial purposes, condominiums, building land (including properties for demolition), buildings under construction and leasehold land (Article 59 CISA and Article 56 CISO). Other investments are also permitted, such as mortgage notes or other contractual charges on property, participa - tions in claims against real estate companies, units in other real estate funds, and foreign real estate securities (Article 86, para 3 CISO). Other funds for traditional investments provide a broader range of investments and strategies. Such funds are notably permitted to invest in securities, precious metals, real estate, com - modities, derivatives, units of other collective investment schemes, money market instru - ments and sight and time deposits with a term of up to 12 months (Article 69 CISA and Article 99 CISO). They may carry out investments that have only limited marketability, that are subject to strong price fluctuations, that exhibit limited risk diversification and that are difficult to value (Article 69, para 2 CISA). Such funds include open-ended CIS, which in terms of their invest - ments, investment techniques and investment restrictions entail a risk profile that is typical for traditional investments (Article 70, para 1 CISA).
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