Volume 1 – Marketing to Swiss pension funds
The Swiss pension fund market ranks among the largest in Europe, with total assets under management (AUM) that exceeded CHF 1.4 trillion end 2024. Pension funds represent the dominant share of AUM in Switzerland, positioning them as one of the most significant investor base in Europe.
Swiss pension funds collect contributions from employers and employees to build retirement capital. Such funds are then reinvested to grow the capital over time. Upon retirement, disability, or death, pension funds pay out benefits to the beneficiaries.
Swiss pension funds are increasingly pursuing international diversification strategies when investing contributions. While they continue to invest in traditional asset classes, there is a growing allocation towards alternative investments, including private equity, infrastructure, and private debt. This evolving investment approach as well as their size make Swiss pension funds an attractive investor base for non-Swiss fund sponsors.
This article is written in a practical Q&A format to help readers navigate the key considerations they need when engaging with Swiss pension funds. Volume 1 outlines the steps and requirements for marketing to Swiss pension funds, while Volume 2 addresses the regulatory conditions that must be met to enable these investors to allocate capital to non-Swiss funds.
How are Swiss pension funds regulated?
As Switzerland is not a member of the European Union, it maintains an independent regulatory framework. This framework governs both (i) the marketing of investment funds to Swiss pension funds, and (ii) the onboarding process and associated restrictions applicable to such investors. Sponsors need to navigate these rules to make sure pension funds can invest in their products. The marketing rules that apply when engaging with Swiss pension funds are discussed below.
Can non-Swiss Sponsors benefit from a reverse solicitation exception?
Yes – but only in very limited circumstances.
Reverse solicitation refers to a situation where Swiss regulations do not apply because a Swiss investor independently initiates contact with a foreign financial service provider – such as a sponsor or fund manager.
While reverse solicitation is recognised as an exception to the general rules governing cross-border financial services, its applicability is extremely narrow. The exemption only applies when the pension fund acts entirely on its own initiative, without any prior engagement or influence from the non-Swiss sponsor (i.e. no marketing, advertising or other form of solicitation).
The Swiss Financial Market Supervisory Authority (FINMA) takes a strict, fact-based approach to assessing whether a relationship was genuinely initiated by the pension fund. A mere declaration of reverse solicitation by the pension fund is not sufficient if the surrounding facts suggest otherwise.
Given the high level of regulatory scrutiny and the potentially severe consequences of non-compliance, any reliance on reverse solicitation for onboarding a Swiss pension fund should be carefully evaluated on a case-by-case basis. It must be supported by thorough legal analysis and robust documentation.
Can non-Swiss sponsors pre-market to Swiss pension funds?
Under Swiss law, non-Swiss fund sponsors can gauge interest from Swiss pension funds through the pre-marketing exemption. However, unlike in many other jurisdictions, Switzerland does not offer a clearly defined regulatory framework for pre-marketing. There are no formal registration requirements, no exhaustive list of permissible activities, and no official guidance from the FINMA on the scope of pre-marketing.
In practice, it is possible to "test the water" without triggering Swiss marketing rules – provided that the materials shared with the Swiss pension funds are appropriately structured. Such materials must be strictly limited to indicative and non-final fund terms, and may include general information about the fund manager, its team, track record, and overall investment strategy. These elements, when presented correctly, do not constitute marketing under Swiss law.
Nevertheless, given the potentially severe regulatory consequences of non-compliance, fund sponsors should seek specialised legal advice before engaging with prospective Swiss pension funds. This ensures that all communications remain within the bounds of pre-marketing and do not inadvertently trigger marketing obligations under Swiss regulations.
What do non-Swiss sponsors need to observe when marketing to Swiss pension funds?
Marketing fund units to Swiss pension funds is governed by two distinct sets of rules. Rules that are activity-based and rules that are product-based.
With respect to activity-based rules, the Swiss Financial Services Act (FinSA) qualifies the marketing of fund units as a financial service. Accordingly, when a non-Swiss sponsor approaches Swiss pension funds, it is considered a financial service provider under Swiss law.
As a financial service provider, certain regulatory obligations apply to the non-Swiss sponsor under FinSA. Such obligations depend on the classification of the pension fund. The non-Swiss sponsor must segment pension funds using a client segmentation form, identifying them as per se (or native) professional investors.
Swiss pension funds with professional treasury operations are deemed professional investors under FinSA. A pension fund has professional “treasury operations” if at least one professionally qualified person with experience in the financial sector has been entrusted, within or outside such pension fund, with the task of managing that entity’s financial resources over the long term (i.e. not on a one-off basis).
In addition to the client segmentation, the non-Swiss sponsor must also send standardised disclosures to the Swiss pension fund providing (i) information on the entity responsible for marketing, i.e. the sponsor, (ii) and the fund units.
Sponsors must also meet organisational requirements, including appropriate internal structures and adequately trained personnel prior to commencing marketing efforts. If the non-Swiss sponsor is not prudentially supervised from a Swiss regulatory perspective, it is subject to the client adviser registration requirement. This means that individuals involved in marketing activities must be registered in a Swiss Client Adviser Registry before engaging with Swiss investors (see below for further details)
With respect to product-based rules, the Swiss Collective Investment Schemes Act (CISA) provides for the applicable legal framework for the offering of fund units. Swiss pension funds that qualify as per se professional investors under FinSA, are considered qualified investors under CISA. As qualified investors, these pension funds may be offered fund units without FINMA authorisation, provided that the fund is not made available to non-qualified investors.
However, if a pension fund does not qualify as a per se professional investor – typically due to the absence of professional treasury operations – additional compliance obligations under both FinSA and CISA will apply. These may include the affiliation with an ombudsman as well as appointing a Swiss representative and paying agent.
Do non-Swiss sponsors have registration duties when marketing to Swiss pension funds?
As mentioned above, if the non-Swiss sponsor is considered prudentially supervised from a Swiss regulatory perspective, and the marketing is limited to per se professional pension funds, there is no requirement for client adviser registration. When in doubt, non-Swiss sponsors should seek legal advice to structure their marketing activities in a way that avoids triggering the registration obligation.
However, if the non-Swiss sponsor is not prudentially supervised, the client adviser registration requirement under Swiss law applies. This obligation is not equivalent to a formal authorisation by the supervisory authority. Rather, it is a swift process that requires that individuals involved in marketing activities directed at Swiss investors be registered in a Swiss client adviser registry. To meet this requirement, the investor relations personnel of the sponsor must submit documentation demonstrating inter alia their professional qualifications, including proof of relevant expertise, a valid identification document, evidence of professional liability insurance, and confirmation of affiliation with a recognised ombudsman service (if required).
Do you have any questions? Please do not hesitate to contact us, and make sure to also consult Volume 2 of this article.
