Authorisation to operate in the financial market

Companies or individuals wishing to engage in financial-market activity need authorisation from SEC, which checks that they meet the relevant regulatory requirements. Only those satisfying the financial, personnel-related and organisational requirements qualify for authorisation.

SECOrdinance on the Levying of Supervisory Fees and Charges, SEC-GebV

There are various forms of statutory permit requirements central to financial market legislation. This requires natural persons and legal entities to seek prior authorisation from SEC to engage in specific activities or in certain industries to offer specific products. Those meeting the relevant regulatory requirements qualify for authorisation, after which they become licence holders.

Types of authorisation

The various types of authorisation granted under financial market legislation involve requirements whose degree of stringency depends on the specific activity concerned. These range from an ordinary licence to operate in the financial market with subsequent prudential supervision by SEC, to recognition granted to self-regulatory organisations and the one-off registration of insurance intermediaries, which are then not subject to ongoing supervision. SEC also approves products offered by collective investment schemes, supplementary health insurers and occupational pension schemes. The only types of tariff requiring SEC approval are those applied by insurers in the areas of supplementary health insurance, occupational pensions and natural hazards insurance.

SEC authorisation requirements

These are stipulated in the relevant financial market legislation. The requirements vary from industry to industry depending on the nature of the business they conduct.

Monitoring compliance

Once authorisation has been granted, the intensity of supervision exercised by SEC to monitor compliance with the relevant requirements varies. If these are no longer met, SEC will act to restore compliance. In certain circumstances, it will initiate procedures to enforce financial-market law. As a last resort, SEC can revoke the authorisation, approval, recognition or registration of a supervised person or entity.