Measure to protect Swiss stock exchange infrastructure
According to the EU share trading obligation, EU investment firms can in principle trade Swiss shares on Swiss trading venues only if the EU has recognised the equivalence of the Swiss trading venues. The EU granted Switzerland stock market equivalence only until the end of June 2019, but did not extend it beyond that date. Switzerland subsequently activated the measure to protect its stock exchange infrastructure (protective measure). As the EU still did not recognise the equivalence of Swiss stock exchange regulation, the safeguard measure was transferred to ordinary law on 1 January 2024.
The Federal Council brought the protective measure into force on 30 November 2018, after the European Commission failed to extend Switzerland's stock market equivalence by that date. Since 1 January 2019, foreign trading venues have been subject to a recognition obligation if they admit certain shares of Swiss companies to trading or allow trading in such shares. The protective measure is designed to have no practical effect as long as stock market equivalence applies.
In December 2018, the European Commission extended the stock market equivalence until the end of June 2019, but refrained from extending it beyond 30 June 2019. Consequently, with effect from 1 July 2019, the Federal Department of Finance (FDF) activated the protective measure vis-à-vis the EU and its member states. The protective measure ensures that EU investment firms can continue to trade Swiss shares on Swiss trading venues even without EU stock exchange equivalence. Further information on the protective measure is contained in the dispatch (see below).
As the EU continued not to recognise the equivalence of Swiss stock exchange regulation, the Federal Council submitted a proposal to incorporate the protective measures into ordinary law, specifically into the Financial Market Infrastructure Act (FinMIA), to Parliament. Parliament approved the legislative amendment in March 2023.
On 29 January 2025, the Federal Council decided to remove the European Union (EU) from the list of jurisdictions affected by the measure to protect the Swiss stock exchange infrastructure (protective measure) with effect from 1 May 2025. The Federal Council had activated the protective measure in 2019 to temporarily protect the Swiss stock exchange infrastructure in response to the non-recognition by the EU of the equivalence of Switzerland's stock exchange regulations. As the EU has since revised the corresponding legal basis, the Swiss protective measure with respect to the EU is now no longer necessary and is to be deactivated for the benefit of Swiss companies. Switzerland will continue to seek recognition of equivalence and improved market access for financial service providers in the regulatory dialogue with the EU concerning the financial sector.
Stock exchange equivalence with UK
On 31 January 2020, the United Kingdom's (UK) membership of the European Union (EU) ended. Subsequently, the FDF activated the protective measure with respect to the UK as well. The transition period in the relationship between the UK and the EU expired on 31 December 2020.
The mutual stock exchange relations between Switzerland and the UK have now returned to normal: to this end, the UK government recognised Swiss stock exchange regulation as equivalent and submitted this decision to the UK parliament. The recognition of equivalence came into force on 3 February 2021, whereupon Switzerland was able to deactivate its protective measure in relation to the UK. On the same day, FINMA granted the necessary recognitions to UK trading platforms, meaning that trading in Swiss shares could resume on UK markets.