New Prospectus Requirements under the FinSA
Another novelty in the Swiss market is the new prospectus
regime that applies as from 1 December 2020 and that has been
introduced by the Federal Financial Services Act (FinSA).
In a general attempt to bring the Swiss regulatory framework in
line with international regulations, such as MiFID II and the EU
Prospectus Directive, the Financial Market Infrastructure Act
(FinMIA), the FinSA and the Financial Institutions Act (FinIA)
replaced major portions of the existing regulations. The FinSA
and the FinIA entered into force on 1 January 2020 along with
the explanatory Financial Services Ordinance (FinSO, relating
to the FinSA) and the Financial Institutions Ordinance (FinIO,
relating to the FinIA).
For the first time in Switzerland, the FinSA introduces a new
comprehensive prospectus regime that covers and harmonises
disclosure requirements for different types of financial instruments
and establishes a level playing field with the EU Prospectus
Directive. This also affects the issuance of instruments to the
capital markets in securitisation transactions.
According to the FinSA, “any person offering securities for sale
or subscription in a public offering in Switzerland or any person
seeking the admission of securities for trading in a trading
venue as defined in the FinMIA must first publish a prospectus”.
The most important novelties introduced by the FinSA in relation
to the prospectus requirements are the following.
• A prospectus must be published also in secondary offerings.
• A prospectus must be published in the event of any admission
for trading of securities on a trading platform (not only
in case of a listing).
• A prospectus must be pre-approved prior to publication by a
new regulatory body licensed as such by FINMA.
• Certain exemptions apply also in relation to ABS securities,
allowing for an ex post approval as under the current
regime.
• There are now (further) codified exemptions from prospectus
requirements.
Exemptions are based either on the type of offering, the type of
securities offered or, in the case of the admission to trading only,
related to the admission.
Type of offering
No prospectus is required if securities are offered:
• to professional clients, insurance companies or companies
with a professional treasury;
• to not more than 500 investors;
• with minimum investments or minimum denominations of
CHF100,000; and
• with an aggregate volume (over the last 12 months) of not
more than CHF8 million.
Type of securities
No prospectus is required in the case of exchange of equity
securities, offerings in the context of a merger, spin-off, conversion
or asset transfer transaction (to the extent equivalent
information is available) or in case of offerings to executives
or employees.
Finally, certain exemptions apply for admissions to trading.
Under the newly introduced prospectus pre-approval regime,
the FinSA grants the Swiss Financial Market Supervisory
Authority FINMA the authority to designate and grant licences
to the reviewing bodies for prospectuses. Only on 1 June
2020, FINMA designated and granted a licence to each of BX
Swiss AG (the Berne Stock Exchange) and SIX Exchange Regulation
AG (Zurich) to act as prospectus review body. Hence,
even though in force since 1 January 2020, the mandatory preapproval
process applies only once a six-month period lapsed
following 1 June 2020 as per the transitional provisions of the
FinSA. Nevertheless, some issuers have recently already gone
through the approval process.