Legal basis for the compulsory liquidation of unauthorised institutions

FINMA is responsible for liquidating institutions operating on the financial market without a licence.

FINMA supervises persons and entities that are required to be licensed, recognised or registered under the financial market acts (listed in Art. 3 of the Financial Market Supervision Act, FINMASA).

To protect the integrity of the financial markets it is necessary to remove institutions operating without the required licence from the market straight away. In doing so, FINMA attempts where possible to consider the interests of investors and creditors, who are often victims of malpractice.

According to the Federal Supreme Court’s practice (BGE 131 II 306, E. 4.1.1 f.), FINMA will order the compulsory liquidation of an unauthorised institution.

Since 1 January 2023, FINMA is no longer responsible for the insolvency of unauthorised institutions (Art. 173b para. 2 SchKG). In the event of overindebtedness or illiquidity of an unauthorised institution, the ordinary bankruptcy courts now have jurisdiction. However, FINMA will still complete bankruptcy proceedings that were opened before 1 January 2023.