Sfama Distribution Agreement

All distributors must enter into a written distribution agreement with the supplier on the basis of the current versions of the model distribution contract issued by SFAMA. Distributor provisions attached to the distribution directives (here are the “distribution rules,” see section 3 below) must be an integral part of the written distribution agreement between the distributor and the supplier in Switzerland. The distributor provisions in the distribution directives annex apply to all distributors, including distributors based outside Switzerland, and must be included in distribution agreements between promoters and distributors in Switzerland. These provisions apply to distributions to both unskilled and qualified investors. However, licensees who pay for transfers must state in the Fund`s documents that the transfers are paid and for which benefits they are paid. It is not necessary to mention the names of service providers. Recipients must also ensure that the information is transparent. They must inform investors, without being solicited and free of charge, of the amount of compensation they can receive for distribution. Upon request, they must disclose the amounts they actually receive for the allocation of investment funds held by the investors concerned. In the event of a conflict of interest, the existence of conflicts of interest and their nature must be communicated to investors in an appropriate and sufficiently specific form when obtaining transfers from distribution activities may result in conflicts of interest. If a Swiss bank directly or indirectly enters your fund into its fund, it is unlikely to boil down to the distribution by the investment manager of the fund, unless the investment manager does not have direct contact with investors and does not himself transmit any documents or material related to the fund to investors. Subject to compliance with its obligations under Swiss law, the Swiss bank may provide some of its investors with documents and documents related to funds in accordance with the discretionary management agreement.

Steven Whittaker is a partner in the London office of Schulte Roth-Zabel, where he focuses on advising on the creation and operation of hedge funds in the UK, Europe and a multitude of offshore jurisdictions, as well as on the structuring and operation of alternative fund management groups, including LLP agreements, as well as seed capital agreements. If a fund is distributed exclusively to eligible regulated investors (see item 4 below), the new CISA/CISO requirements do not apply. On the other hand, if a fund is to be distributed to unregulated investors (see 5 below), the new CISA/CISO requirements apply. These new requirements include, among other things, the Fund`s designation of an approved representative in Switzerland and a Swiss bank as a paying agent, certain mandatory information for Swiss investors and entry into a Swiss-compliant distribution agreement (see item 7 below). A new regime for the distribution of non-Swiss funds to Swiss investors will come into full force on 1 March 2015, when the current transitional period will expire. The new regime divides Swiss investors into three categories: (1) unregulated qualified investors (retirement plans, companies, family offices, family trusts and wealthy individuals); (2) regulated eligible investors (a smaller list of regulated financial entities in Switzerland, such as banks, securities dealers, fund managers and insurance companies); and (3) unqualified investors (effective retail trade).

Comments are closed.