01 Nov 2009 HFM Focus Switzerland
With regulatory clamour currently sweeping the EU, HFM Week takes a look at how Switzerland hedge funds, a well-established draw for hedge funds, on account of its flexible regulation and favourable tax regime, is adapting to the new landscape, and what the region has to offer as a domicile for asset managers.
HFMWeek: What sets Switzerland apart from other jurisdictions as a domicile for hedge funds?
Dominique Lecocq (DL): The straightforward regulatory environment, the favourable tax treatment that can be negotiated with the tax administration, and the fact that Swiss banking institutions have been active in the alternative asset management industry for decades and understand the business. Switzerland is also one of the only jurisdictions that does not request a specific regulatory licence to manage offshore (non-Swiss) funds – managers are only subject to Anti-Money Laundering regulatory oversight. A licence from the Swiss Financial Market Supervisory Authority (Finma) only is required for the management of Swiss-based investment funds.
The tax environment for investment funds in Switzerland is also favourable, as the Geneva tax authorities have made efforts to encourage funds and fund managers to come to Geneva. The form of the tax ruling is not yet final, but the authorities and the industry are working closely together
to find an attractive solution.