This page aims to provide essential information in compliance with the Swiss Financial Services Act (“FinSA”), which entered into force on 1 January 2020. The FinSA aims at strengthening investor protection and establishing comparable standards for financial service providers. Capital International Sàrl (“CISA”) made use of the regulatory transition period of two years to implement FinSA duties regarding the rules of conduct and the organizational measures, which are effective from 1 January 2022.
This page is provided for information and regulatory purposes only and should not be considered as marketing material and/or as providing any form of advice, whether financial or otherwise. Please do not hesitate to contact us should you have any questions.
CISA is a financial service provider located at 3, place des Bergues, 1201 Geneva, Switzerland.
CISA is regulated by the Swiss Financial Market Supervisory Authority (FINMA), located at Laupenstrasse 27, 3003 Bern, as an Authorised Asset Manager of Collective Investments and Representative of Foreign Collective Investments Schemes.
CISA provides financial services that fall within the scope of FinSA, such as acquisition or disposal of financial instruments, portfolio management, investment advice and representation and distribution of collective investment schemes.
FinSA requires CISA to classify its clients into three categories: retail, professional and institutional clients. This influences the level of regulatory protection the client can benefit from (e.g. regarding information duties, suitability and appropriateness obligations, transparency and care in client orders as well as documentation duties).
Based on these classifications, the corresponding level of regulatory protection varies:
The highest level of regulatory protection is granted to retail clients, who are neither professional nor institutional clients.
Professional clients are deemed to have the necessary knowledge and experience to invest and bear the risks associated with financial services. Professional clients are:
Public entities with professional treasury operations1 ;
Pension funds and institutions dedicated to occupational pension provision with professional treasury;
Companies with professional treasury operations;
Large companies. A large company is a company which exceeds two of the following parameters: balance sheet total of CHF 20 million, turnover of CHF 50 million, equity of CHF 2 million; and
Private investment structures with professional treasury operations created for high-net-worth private clients;
High-net worth retail clients and private investment structures created for them who opted out to professional client status. Please refer to point 4. Change in client classification for more information.
Institutional clients are afforded the lowest level of regulatory protection. Institutional clients are:
Financial intermediaries as defined in the Swiss Banking Act, the Swss Financial Institutions Act and the Swiss Collective Investment Schemes Act;
Insurance companies as defined in in the Swiss Insurance Supervision Act;
Foreign clients subject to prudential supervision;
National and supranational public entities with professional treasury operations.
1 The requirement of professional treasury operations involves that at least one experienced person with qualifications in the financial sector is mainly and constantly responsible for managing the financial resources of the company.
Some clients may declare in writing that they request to “opt out” to reduce their regulatory protection or, alternatively, to “opt in” to increase it.
For retail clients
High-net-worth retail clients and private investment structures created for them can request to be considered as professional clients (“opt out”). Retail clients can be considered as high-net-worth retail clients if:
On the basis of training, education and professional experience, or on the basis of comparable experience in the financial sector, they possess the necessary knowledge to understand the risks associated with the investments and have at their disposal assets of at least CHF 500’000; or
They have at their disposal assets of at least CHF 2 million.
For professional clients
The following professional clients can request to be considered as institutional clients (“opt out”):
Occupational pension schemes with professional treasury operations and other occupational pension institutions providing professional treasury operations
Companies with professional treasury operations
Swiss and foreign collective investment schemes and their management companies which are not already deemed to be institutional clients
Professional clients can request to be considered as a retail client (“opt in”). However, it is to be noted that this will entail further assessments to be made by CISA and may lead to restrictions to the level of servicing CISA can offer.
For institutional clients
Institutional clients can request to be considered as professional clients (“opt in”).
CISA, when providing investment advice or portfolio management services, must perform an appropriateness or suitability review, where applicable. To this end, the client is required to complete a Client Questionnaire where CISA enquires about, among others, the client’s financial situation and investment objectives, as well as its financial knowledge and experience. The knowledge and experience relates to the financial service provided by CISA and not to individual transactions.
CISA is not required to perform any appropriateness and suitability review for institutional and professional clients.
The market offer taken into account by CISA when selecting financial instruments for its clients comprises collective investment schemes offered by The Capital Group companies as well as financial instruments available on the financial markets.
In compliance with FinSA, CISA has implemented an internal governance framework, including a best execution policy, to ensure that the transmission and execution of orders are performed in accordance with best execution rules.
CISA is part of The Capital Group Companies. Business affiliations between CISA and The Capital Group Companies are maintained in connection with the financial services offered by CISA to its clients.
CISA strives at maintaining effective arrangements so conflicts of interest do not adversely affect the interests of its clients and takes all reasonable steps to identify and manage all conflicts of interest which may arise. Should CISA identify a conflict of interest arising in connection with the financial service offered to its clients, CISA will notify the client, including details of the circumstances giving rise to the conflict of interest, the risks which the client faces as a result and the precautions taken by CSIA to reduce the risks.
CISA shall not receive any fee, commission or income whatsoever from any other third-party source in connection with the performance of the contracts signed with its clients. CISA receives and pays fees in respect of intercompany services extended to and received from other companies of The Capital Group exclusively on the basis arms’ length arrangements. Such intercompany fees will not be passed on to the clients.
Financial instruments are associated with opportunities and risks and it is important that clients understand these risks before using a financial service or transacting in a financial instrument.
More information on the financial instruments and investment strategy offered by CISA to its clients and the associated risks and costs of such instruments can be found in the relevant prospectus or Key Investor Information Document available on https://www.capitalgroup.com, provided that the relevant financial instruments are offered by The Capital Group companies.
Information on costs and fees of the financial services offered by CISA to its clients can be found in the periodic report and fee invoicing, or in the relevant prospectus or Key Investor Information Document available on https://www.capitalgroup.com, provided that the relevant financial instruments are offered by The Capital Group companies. In respect of discretionary portfolio management mandates, the information on costs and fees is provided to the client separately.
FinSA provides for the possibility of initiating mediation proceedings before an ombudsman to settle legal disputes between clients and financial service providers. For this purpose, CISA is affiliated with an ombudsman that has been recognized by the Federal Department of Finance. The ombudsman is a free and neutral information and mediation agency. CISA is affiliated with Terraxis Ombudsman, located at Rue de la Tour de l’Ile 1, 1204 Geneva, Switzerland.