The case

In connection with the new trustee licensing procedure, SATC was repeatedly asked by members and interested trust companies whether structural changes, e.g. the acquisition of another trust company, would affect the mentioned procedure. Specifically, the question was asked whether the merger of two trust companies could result in the new (resulting) company losing the benefit of the transitional provisions of FinIA.

In one of the regular contacts SATC and STEP have with FINMA, SATC raised this issue of changes in corporate structure and the impact such changes may have on the licensing requirements. FINMA clarified that where two trust companies exist and are professionally active at the time the new legislation came into force, a merger between the two will not result in the merged company being considered a “new operator” that cannot benefit from the transitional provisions. However, FINMA also clarified that it is not possible to “buy” a licence by merging a non-licensed entity with a licensed one. In any case, such a change is likely to be material and therefore subject to a prior authorisation requirement on the part of the licensed entity under art. 8 par. 2 FinIa.

Source: FINMA and SATC (Philippe de Salis, Chairman)

The commentary

According to FINMA, it is however permissible to submit an application for a trustee license with a factual basis that does not yet correspond to reality, provided the implantation can be carried out shortly when the license is granted. A prudent approach would therefore be to include planned changes in structure in the licence application and make the transaction conditional on FINMA’s approval.

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