What you need to know about compliance

What you need to know about compliance

As a regulated financial intermediary we have detailed duties under law when setting up and running a company or trusts. If the company is not Swiss, we will have to work with a local agent and comply with its due diligence requirements as well as our own. This means extensive work at the beginning of the relationship, as well as continuous upgrading of their files as well as ours thereafter. If there are bank accounts involved, this means another layer of due diligence as we work with bank compliance officers.

More recently, financial intermediaries have been required to deal with more compliance due to FATCA (the Foreign Account Tax Compliance Act). This highly complex US legislation creates a liability and reporting responsibility for all corporate service providers worldwide for every vehicle they manage (regardless of whether there is any connection with the USA).

In 2014, the OECD and a number of other countries endorsed a new system for common reporting standards and automatic exchange of information between tax administrations. This system will be gradually coming into operation and will layer in a whole new level of bureaucracy for corporate service providers.

All this means considerable costs for you and us. We have to pay a membership fee to the Self-Regulatory Organisation we belong to, as well as pay an annual fee for each company we manage and for periodic SRO audits. We have to pay for continuous training of our trust officers and directors to attend courses and keep up to speed on a continually changing set of rules. We absorb all the costs of this, as well as our initial due diligence work for new companies or trusts, into our standard set up fees. However, the detailed compliance work thereafter will be subject to our normal hourly administration charges.