Setting up an asset management company in Geneva rarely fails on capital or legal form. It fails on two questions that independent managers settle too late. The first: is your activity already carried out on a professional basis within the meaning of the law? The thresholds are low, and one of them is enough.
The second concerns sequence. Affiliation to a supervisory organisation is not a step that follows FINMA authorisation: the confirmation of affiliation is one of the documents that condition it. Many projects are built the other way round and lose months. RISTER® frames that sequence before incorporation, then keeps the accounts and the administration of the company once it is authorised.
Contents
Advice or discretionary mandate: two regimes
Everything starts with who decides. If your client decides and you recommend, you provide a financial service within the meaning of the Financial Services Act: conduct rules apply, with client segmentation, the duty to inform, the assessment of suitability and appropriateness, documentation, and the question of registration in the client advisers register. If you decide in your client’s place on the basis of a mandate, you carry out asset management, and the Financial Institutions Act applies, with an authorisation to be obtained before you begin.
The line is more porous than it looks. A trading power of attorney used autonomously, a practice where the client approves systematically without examining, a mandate drafted in advisory terms but executed as management: the classification follows the operational reality, not the label on the contract. What follows concerns the second case, the one that requires authorisation, and the construction of the Geneva structure that supports it.
Am I already acting on a professional basis?
Only asset managers acting on a professional basis are subject to the authorisation requirement, and the law puts figures on that notion. An asset manager is defined as any person who, on a professional basis, can dispose of clients’ assets in their name and on their behalf on the basis of a mandate.
| Criterion | Threshold |
|---|---|
| Gross proceeds | More than CHF 50,000 during a calendar year |
| Counterparties | Business relationships not limited to a single activity with more than 20 counterparties during a calendar year, or maintaining at least 20 such relationships during a calendar year |
| Assets under power of disposal | An unlimited power of disposal over third-party assets exceeding CHF 5 million at any given moment |
One condition is enough. The first threshold is the level of a side activity rather than an established practice. The second counts clients, not volume, which catches managers serving a handful of large fortunes as much as those handling many small mandates. The third is measured at a given moment and not as an annual average, so a brief peak crosses it. Certain assets connected with exceptions to the authorisation requirement are not taken into account, which again calls for a precise classification rather than a quick calculation.
Authorisation comes before the activity, with no grace period. Before beginning to act on a professional basis, an asset manager needs to obtain the corresponding FINMA authorisation. There is no phase during which one would build a client base while awaiting the decision, and we do not support arrangements designed to work around that ordering. If your project is approaching any of the three thresholds, the question is not when you will have to deal with FINMA, but how to build the file before the first mandate. Where the classification of your activity is genuinely open to debate, consult FINMA or a specialist lawyer before contracting.
What FINMA requires of the organisation
The conditions for authorisation bear on the structure itself, not only on the people. An asset manager must take the legal form of a sole proprietorship, a commercial company or a cooperative and be entered in the commercial register. It must have an organisation appropriate to its activity, adequately organised risk management and internal control. It must have appropriate own funds and guarantees. It must precisely define its field of activity and its geographical scope in the documents that govern it. And it must provide proof that it is subject to the supervision of a supervisory organisation, by producing a confirmation of affiliation.
RISTER advice
Two of these conditions are consistently underestimated, and they are the ones we work on most. Precisely defining the field of activity and the geographical scope in the governing documents means that the articles of association, the organisational rules and the contractual documentation must delimit what the company does and where it does it. The broad, comfortable drafting normally used to keep options open becomes a defect in the file here. And the confirmation of affiliation to a supervisory organisation is part of the application, not a consequence of the authorisation: it has to be sought upstream, and obtaining it sets the timetable of the whole project.
Your asset management company in Geneva
The supervisory organisation comes before FINMA, not after
Classification of the activity, choice of legal form and drafting of a corporate purpose consistent with the declared field of activity, entry in the commercial register, accounting and internal control built to the expected standard, coordination with the supervisory organisation and with legal counsel: RISTER® runs the project in the order it has to be run.
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RISTER – Fiduciary in Geneva, reply within one business day.
The real order of a project
Because affiliation comes first, the timetable is constrained, and it is not the one most founders assume:
- classify the activity under both acts, starting from what will actually be done rather than from the commercial label
- choose a supervisory organisation and start the affiliation procedure, since the confirmation conditions the application
- incorporate the company in an admitted legal form and enter it in the commercial register, which we handle as part of our company incorporation service in Geneva
- build the expected organisation: governance, risk management, internal control, compliance, own funds and guarantees
- delimit the field of activity and the geographical scope in the articles and the contractual documentation
- file the application with FINMA, then wait for the decision before any mandate carried out on a professional basis
No processing time can be promised: it depends on how complete the file is, on the complexity of the model and on the authority. What can be controlled is the quality of what is filed, and that is by far the most decisive factor. Geneva adds a practical advantage here: the density of custodian banks, auditors and specialist counsel shortens the exchanges that a project run from a canton without a financial ecosystem inevitably suffers.
What a fiduciary handles, and what it does not
The division of roles is worth stating plainly, because it determines who you need to work with and when.
What we handle concerns the structure and its administration: the legal form and the drafting of the corporate purpose, incorporation and entry in the commercial register, a registered address where the project needs one, accounting built to support internal control and reporting requirements, payroll and social insurance, the taxation of the company and of its shareholders, and coordination with the supervisory organisation, the auditor and legal counsel. That is the core of our general administration, accounting and payroll service.
What we do not do. We give no investment advice and express no view on financial products: that is neither our profession nor our licence. We do not file applications with FINMA on behalf of the applicant and promise no processing time. We do not settle the legal classification of a borderline activity in place of a specialist lawyer, and we will tell you to consult FINMA or counsel where the line between advice and management is genuinely debatable. And we do not support projects without substance: an asset management company with no real organisation and no effective presence does not obtain authorisation, and we say so beforehand rather than afterwards.
The pitfalls that cost months
The first is sequencing: incorporating, opening accounts, signing mandates, then discovering that affiliation to a supervisory organisation takes time and conditions the application.
The second is a corporate purpose drafted broadly to keep options open. It then contradicts the requirement to define the field of activity precisely, and the file has to be reworked.
The third is the drift from advice into de facto management, usually unintended: a power of attorney used alone, a practice of formal client approval. The classification changes without any contract having been signed.
The fourth is calculating the thresholds loosely. The CHF 5 million criterion is measured at a given moment, the counterparty criterion counts relationships over a calendar year: these are precise measures, to be documented.
The fifth is accounting set up as for an ordinary SME, without anticipating the internal control, segregation of duties and reporting that will be examined. Rebuilding it afterwards costs more than building it correctly.
FAQ: setting up an asset management company in Geneva
When is FINMA authorisation required?
As soon as the activity is carried out on a professional basis, which the law defines through three thresholds, any one of which suffices: gross proceeds of more than CHF 50,000 during a calendar year; business relationships not limited to a single activity with more than 20 counterparties during a calendar year, or maintaining at least 20 such relationships; or an unlimited power of disposal over third-party assets exceeding CHF 5 million at any given moment. The authorisation must be obtained before beginning to act on a professional basis.
Does affiliation to a supervisory organisation come before or after authorisation?
Before. Proof of being subject to the supervision of a supervisory organisation, in the form of a confirmation of affiliation, is one of the conditions for granting the authorisation. It is a document in the application file rather than a consequence of it, which reverses the order many projects assume and drives the timetable.
Which legal form should an asset management company take?
The law admits the sole proprietorship, the commercial company and the cooperative, with entry in the commercial register in every case. In practice the company limited by shares and the limited liability company are the forms used, the former where several shareholders come in or a sale is contemplated. The decisive point is not the form but the drafting of the corporate purpose, which must match the declared field of activity.
Does an investment adviser also need authorisation?
Not necessarily. Investment advice without a discretionary mandate falls under the conduct rules of the Financial Services Act, together with the question of registration in the client advisers register, but it does not in itself trigger the authorisation required of asset managers. The switch happens when the investment decision is taken in the client’s place, including in fact.
How long does authorisation take?
No timeframe can be promised: it depends on how complete the file is, on the complexity of the model and on the authority. What can be steered is the quality of the application filed and the anticipation of the affiliation to a supervisory organisation, which is the most frequently underestimated timetable factor.
What does a fiduciary handle in this kind of project?
The structure and its administration: legal form, corporate purpose, incorporation and commercial register entry, accounting compatible with internal control requirements, payroll, taxation, and coordination with the supervisory organisation, the auditor and legal counsel. A fiduciary gives no investment advice, does not file the application on the applicant’s behalf and does not replace a lawyer on a debatable legal classification.
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Conclusion
Setting up an asset management company in Geneva turns on two measurements and one order. The measurements are the classification of the activity, advice or management, and whether the thresholds that make it professional have been crossed. The order places affiliation to a supervisory organisation before the application, and the authorisation before the first mandate. A project that respects that chain moves forward; a project that inverts it starts again.
RISTER – Fiduciary in Geneva takes on the part that belongs to it: legal form and corporate purpose, incorporation and commercial register entry, accounting and internal control built to the required standard, payroll, taxation, and coordination with the supervisory organisation and legal counsel. We only take on projects that stand up over time, and we say so when a step is missing. To discuss yours, get in touch.
