Actively Managed Certificates (AMCs) – Regulatory Requirements in Switzerland

April 2, 2025

Actively Managed Certificates (AMCs) are enjoying growing popularity, particularly with innovative investment strategies and tailor-made investment solutions. They are considered structured products and allow actively managed strategies to be implemented in a simple product form. Unlike traditional funds, they are not subject to the Collective Investment Act (KAG) but rather to the rules of the Financial Services Act (FIDLEG) and the corresponding regulation (FIDLEV).

This article examines the legal framework for AMCs in Switzerland and outlines the conditions under which they may be marketed to private clients.

1. What is an AMC?
An Actively Managed Certificate is a structured product that reflects the performance of an actively managed investment strategy. The issuer (usually a bank or a securities dealer) issues a certificate whose performance is based on reallocations within a defined investment universe. Management is carried out by a so-called strategy manager, who, however, does not legally manage any assets but merely issues instructions to the issuer.

2. Distinction from Collective Investment
AMCs are not considered collective investments under the KAG because:

There is no joint management of investor funds,
The issuer remains the owner of the underlying assets,
And investors only hold a claim against the issuer.

Nevertheless, the design in individual cases may result in an economic proximity to collective management. FINMA assesses such cases on an individual basis.

3. Role of the Strategy Manager
Even though AMCs themselves do not fall under the KAG, the strategy manager may be subject to licensing requirements. In particular, it must be examined whether he acts as an asset manager under FINIG. According to Art. 17 FINIG, anyone managing assets as defined in Art. 3 lit. c points 1–4 FIDLEG on behalf of third parties under a continuous mandate requires a license. Since the strategy manager in AMCs issues instructions for the reallocation of the underlying assets but does not formally has a direct authority to dispose over them, the question of de facto asset management is crucial. FINMA evaluates the overall product concept – not just its formal structures. An indirect asset management through AMCs can, therefore, indeed be subject to a licensing requirement.

4. Distribution to Private Investors – Only with Safeguards and Structure
The distribution of AMCs to private clients is strictly regulated by law in Switzerland (Art. 70 FIDLEG in conjunction with Art. 96 ff. FIDLEV).

4.1 Permissible Distribution without an Existing Customer Relationship
An AMC may only be offered to private customers without an existing asset management or advisory relationship if it is:

Issued, guaranteed, or secured by a bank, insurance company, or securities firm with FINMA approval,
Or originates from a foreign institution that is subject to equivalent prudential supervision.

4.2 Distribution through a Special Purpose Vehicle (SPV)
Issuance by a Special Purpose Vehicle (SPV) is permissible provided that:

The SPV exclusively issues financial instruments (its primary purpose),
Distribution is carried out by an approved financial intermediary (bank, securities dealer, etc.),
And there is a safeguard in place equivalent to protection by a bank guarantee or similar security.

Particularly, safeguards include:

Legally enforceable guarantees from a supervised financial institution,
Or tangible securities in favor of the investors (e.g., pledged assets).

4.3 Exception: Customer Relationship with a Written Mandate
If there is an ongoing asset management or investment advisory relationship, the restrictions of Art. 70 para. 1 do not apply. According to Art. 96 para. 1 FIDLEV, this relationship must:

Be demonstrable in writing or text,
Apply to an unlimited number of transactions,
And be provided for a fee.

This provision primarily serves to protect particularly vulnerable private clients without personal advisory or management.

5. Disclosure and Documentation
In the distribution to private customers, the following obligations must be met under FIDLEG:

Preparation of a prospectus, unless an exemption applies,
Preparation of a basic information sheet (BIB),
Conducting a suitability or appropriateness test, if an advisory relationship exists,
Transparent presentation of the investment strategy, risks, costs, and the role of the strategy manager.

6. Conclusion
AMCs are a flexible instrument for implementing active investment strategies. Distribution to private customers is possible but legally clearly defined. Critical factors include the structure of the issuer, the existence of appropriate safeguard mechanisms, and compliance with the documentation and conduct obligations under FIDLEG. Special care is required, especially with SPV structures, to ensure that the requirements for safeguards and distribution are met in a legally compliant manner.

7. Support from LezziLegal
We support you in the legally compliant design, documentation, and marketing of your AMCs: