Swiss Parliament Approves Bern Agreement with UK on Financial Services

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On March 21, 2025, the Swiss Parliament approved the “Bern Agreement,” a financial services mutual recognition deal with the United Kingdom. Signed in December 2023, this agreement aims to strengthen cross-border financial activities between the two countries and is the first of its kind outside the European Union between two major financial hubs facing similar market access challenges.

The Bern Agreement allows regulated financial services firms in the UK and Switzerland to benefit from greater market access and regulatory cooperation. Swiss and British negotiators agreed that financial market protection standards are met equivalently in both countries, leading to mutual recognition of regulatory norms and authorizations.

For Swiss companies, the agreement brings several advantages. Wealth management firms in Switzerland will gain expanded access to the UK market, allowing them to offer services not only to professional clients but also to private clients with a net asset value of over £2 million. However, Swiss providers must meet specific conditions, such as being incorporated under Swiss law, holding authorization from the Swiss Financial Market Supervisory Authority (FINMA), and registering their services with UK regulators.

Swiss financial advisors on temporary assignments in the UK will be able to follow up with their clients directly in the UK. Asset management services will also benefit from increased flexibility in marketing investment funds. Swiss banks and securities firms will be allowed to accept deposits and conduct lending activities in the UK, enhancing their operational reach.

Swiss insurance companies, which already conduct various activities in the UK, will receive further regulatory clarifications under the agreement. Moreover, the Bern Agreement recognizes the existing legal and regulatory framework for stock exchanges, central counterparties, and over-the-counter derivatives, simplifying cross-border transactions and regulatory cooperation.

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Both countries have also committed to working together on sustainable finance by establishing a joint program to align rules and standards.

The Bern Agreement reflects the strong economic ties between Switzerland and the UK, with financial sector exchanges between the two nations valued at £3.28 billion ($3.75 billion) in 2022. The agreement is expected to boost this figure as market barriers are lowered.

Before the agreement takes full effect, both governments must ratify and implement it. The Bern Agreement is expected to come into force at the beginning of 2026, setting a precedent for future financial cooperation between Switzerland and other major financial centers.

This article is originally published on agefi.com

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