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FinTechs belonging to this category offer advisory and broking services for investments usually via an internet platform.
Robo advisory services usually offer an investment proposition following a series of questions concerning the personal financial background and the risk-bearing capacity of the user. Sometimes the respective platform also enables the user to directly execute the proposed investment.
Auto-trading concerns all services which automatically trade on behalf of the customer according to his or her specifications.
Apart from that some FinTechs collect and offer merely or as an ancillary service market information or operate comparison portals to increase the transparency of the capital markets and to help the investor with his decision-making.
There are also FinTech-advertising-services which advertise various financial services or products.
Introduction
Attitude of the country towards modern financial advisory and broking services
In Switzerland, a fintech-friendly legal environment prevails, not least encouraged by FINMA, which considers innovation to be a key factor in Swiss competitiveness.
Legal affairs
Obligations and requirements to provide financial advisory and broking services, or ancillary services described above
The provision of financial advisory services does not trigger a license requirement under Swiss law. However, client advisers of Swiss financial service providers which are not subject to prudential supervision in Switzerland as well as client advisers of foreign financial service providers may carry out their activity in Switzerland only if they are registered in a register of advisors. Further, an affiliation with an ombudsman's office is required.
In addition, under FinSA providing services such as, inter alia, (i) acquisition or disposal of financial instruments, (ii) receipt and transmission of orders in relation to financial instruments, (iii) management of financial instruments, and (iv) provision of personal recommendations on transactions with financial instruments qualify as providing financial services. The provision of financial services under FinSA may trigger requirements for the financial service provider to comply with conduct rules and organisational rules, the rules on the performance of client segmentation, the requirement to accede to the Swiss ombudsman scheme and the comprehensive prospectus regime, which requires an ex-ante approval for prospectuses if financial instruments are publicly offered or admitted to trading at a stock exchange in Switzerland. The rules for the provision of financial services may even apply to services provided to customers in Switzerland on a cross-border basis.
Under FinSA, financial instruments are equity and debt securities (including bonds), units in collective investment schemes, structured products, derivatives, and certain types of deposits whereas financial service providers are persons who provide financial services on a commercial basis in Switzerland or for customers in Switzerland. Services are provided on a commercial basis if there is an independent economic activity pursued on a permanent, for-profit basis.
Robo advice services are not explicitly regulated under Swiss law. However, if the services of a robo advisor qualify as provision of personal recommendations on transactions with financial instruments, the above-mentioned regime on the provision of financial advisory services may apply on robo advisors as well. If a robo advisory business includes automated asset management services, the much stricter regime, as set out under the chapter asset and portfolio management, applies, and may include a license requirement for the robo advisory service provider.
Additional comments regarding the legal situation for financial advisory and broking service