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The Berne Financial Services Agreement Is Now Live: How It Transforms UK-Swiss Market Access 


Discover how the Berne Financial Services Agreement (BFSA) boosts cross-border finance, mutual recognition and market access.


In brief

The Berne Financial Services Agreement:

  • Streamlines UK-Swiss financial services, removing duplicative licensing and reducing compliance costs for wholesale market access. 
  • Introduces outcomes-based mutual recognition, setting a global precedent beyond EU equivalence for cross-border financial cooperation. 
  • Creates strategic growth opportunities for banking, investment, insurance and asset management firms in both jurisdictions.

The Berne Financial Services Agreement (hereinafter the “BFSA” or “Agreement”), signed on 21 December 2023 and entered into force on 1 January 2026, is a pioneering accord establishing broad mutual recognition of financial services between the United Kingdom (UK) and Switzerland – two major financial hubs outside the EU that have faced market access challenges at the European level – hereinafter referred to collectively as “the Parties”. Unlike the traditional regulatory equivalence model championed by the European Union (EU), this Agreement embraces an outcomes-based recognition framework, setting a new benchmark for international financial cooperation. It promotes regulatory cooperation and facilitates the provision of cross‑border financial services to wholesale clients.

Trade in financial services between the UK and Switzerland has flourished in recent years, growing by 53% between 2016 and 2022, and reaching an annual value of CHF 28.5 billion as of 2024. This strong growth underscores the depth of economic ties and highlights significant growth opportunities in finance driven by improved market access.

The BFSA represents a pivotal moment in bilateral relations between the two Parties, enhancing the provision of financial services – including asset management, banking, insurance and investment – through mutual recognition of each Party’s regulatory framework. This approach promotes financial stability, market integrity and investor protection, while reducing fragmentation and fostering a more integrated, resilient financial market. Ultimately, the Agreement benefits consumers, strengthens the financial sector and supports the broader global economy.

Status, Next Steps and Timeline

Following the UK’s official departure from the EU on 31 January 2020, the UK and Switzerland issued a Joint Statement at the ministerial level on 30 June 2020, affirming their intention to negotiate an agreement based on the mutual recognition of supervisory and regulatory regimes. The BFSA represents the culmination of over two years of negotiations and marks a significant political and economic milestone in the post-Brexit landscape. It underscores the UK’s capability to forge new and strategically relevant international trade relationships while simultaneously reaffirming Switzerland’s position as a proactive and capable global trading partner. For both nations, this Agreement reflects a shared commitment to modern, rules-based trade and highlights their mutual interest in fostering economic cooperation beyond traditional EU frameworks.

The BFSA, signed on 21 December 2023 and effective as of 1 January 2026, represents a landmark framework for cross-border financial services between Switzerland and the UK. 

1. Parliamentary Ratification and Entry into Force

In Switzerland, the Federal Council submitted the BFSA to the Swiss Parliament on 4 September 2024, and approval was granted on 21 March 2025. No popular referendum was initiated against the Agreement during the prescribed period, which ended in July 2025. In the UK, the BFSA was laid before Parliament on 13 March 2024 and formally presented on 8 April 2025. Following completion of the domestic ratification processes by both Parties, the BFSA entered into force on 1 January 2026.

2. Regulatory and Supervisory Framework

Beyond parliamentary approval, the BFSA requires detailed regulatory guidance. Both the Swiss Financial Market Supervisory Authority (FINMA) and the UK’s (FCA) are expected to issue circulars addressing technical and practical considerations.

Key developments include:

22 September 2025: FINMA, the FCA and the Bank of England signed a Memorandum of Understanding (MoU) under the BFSA. This MoU formalizes supervisory cooperation and establishes the framework for implementing the BFSA in the investment services and insurance sectors, setting out detailed arrangements for coordination between the authorities.

8 October 2025: During the Financial Dialogues in Berne, Switzerland and the UK issued a joint statement reaffirming cooperation on five themes: economic outlook, regulatory developments, sustainable finance, market access (including BFSA implementation) and innovation.

3 November 2025: FINMA published guidelines detailing how institutions can benefit from the BFSA, including technical processes and simplified market access. On the same day, the Prudential Regulation Authority (PRA) and the FCA jointly issued guidance to assist firms considering the provision of services under the BFSA. These guidelines aim to help firms navigate the new framework by clarifying regulatory expectations, outlining operational considerations and ensuring compliance with applicable standards.

Underlying Principles

At the core of the BFSA lies the principle of mutual recognition. This approach reflects a high level of trust between the Parties, as each acknowledges that the other’s domestic regulatory and supervisory frameworks deliver equivalent outcomes in terms of financial stability objectives, market integrity safeguards and investor protection outcomes. Under this framework, financial service providers are not required to obtain an additional license or notify the host regulator when offering Covered Services (see definition below) to eligible clients on a cross-border basis between their home jurisdiction and the other Party. This eliminates duplicative regulatory requirements and significantly streamlines market access. Mutual recognition under the BFSA is structured around three distinct levels of commitment, each representing a different degree of alignment and confidence between the Parties:

1. Deference: One Party agrees to lower the barriers to the cross-border supply of Covered Services into its territory, deferring to domestic authorization and prudential measures. This means that Swiss and UK financial service providers are permitted to conduct operations in the host Party’s country primarily following the regulatory and supervisory rules of their home Party. Deference thus enables greater operational continuity and lowers compliance costs for cross-border activities.

2. Domestic law: In some cases, one Party confirms that its existing domestic legal framework already permits financial service providers from the other Party to offer specific Covered Services to Covered Clients (see definition below) within its territory. In these instances, the operations must fully comply with the domestic laws and regulations of the host Party.

3. Other (bespoke) arrangement.

Scope of the BFSA: Covered Clients, Services, Sectors and Instruments

The BFSA applies exclusively to wholesale financial services offered to clients defined in Annex 5 of the Agreement. These Covered Clients include:

  • Professional and institutional clients
  • High-net-worth individuals who meet the prescribed criteria

Retail clients who do not satisfy the high-net-worth test are excluded from the scope of the Agreement. Depending on the client category, financial service providers may need to comply with specific obligations.

The BFSA covers seven sectors, collectively referred to as “Covered Services”, all provided on a wholesale basis:

  • Banking
  • Investment services
  • Asset management
  • Insurance
  • Financial market infrastructures, including:
    • Central counterparties (CCPs)
    • Over-the-counter (OTC) derivatives
    • Trading venues

Market Access and Implementation

As of July 2025, eligible Swiss investment firms and UK insurers can express their interest in participating under the BFSA by notifying the respective regulators through the following procedures:

For Swiss firms:

  • Submit an application via FINMA’s survey and application platform (EHP).
  • FINMA review: If successful, FINMA will confirm the firm’s eligibility and good standing with the UK FCA within 60 days.
  • FCA registration: Upon receiving FINMA’s confirmation, the FCA will add the firm to its public BFSA register within 30 days.
  • Activation: Once listed, the firm may begin supplying services in the UK. Firms will receive a notification when registration is complete.

For UK firms:

  • Submit an expression of interest form via Connect.
  • FCA / PRA review: If successful, the FCA or Prudential Regulation Authority will confirm the firm’s eligibility and good standing to FINMA within 30 days.
  • Swiss registration: Following confirmation, FINMA will complete the process, enabling the firm to access the Swiss market under BFSA provisions.

Benefits

The BFSA offers significant benefits to both Parties, strengthening their financial services sectors and fostering economic growth. It reduces regulatory burdens, enabling firms to focus on their core operations rather than navigating complex compliance requirements. Moreover, it promotes closer cooperation between the UK and Switzerland, including enhanced supervisory collaboration between FINMA and the FCA, which may lead to more effective solutions and innovation in the financial sector.

 

Switzerland

 

For Swiss firms, the UK is a vital export market for cross-border wealth management services. The BFSA introduces a forward-looking access framework for Swiss investment services firms, supported by deference commitments. This allows Swiss firms to supply wholesale and high-net-worth clients in the UK without having to comply with UK authorization and prudential measures, reducing regulatory complexity and costs. While certain UK requirements still apply – such as FCA registration and client classification tests – the framework offers a more streamlined and predictable route compared to existing mechanisms.

 

Swiss insurance firms also benefit from improved access to the UK market. Under the Agreement, they can expand their wholesale offerings without duplicating compliance costs, creating new opportunities for growth. Although insurers operate under UK domestic law rather than benefiting from deference, the UK commits to maintaining open access for professional clients and to consult before introducing measures that could restrict such access. This provides greater certainty and stability for Swiss insurers when planning cross-border operations.

 

Finally, the BFSA also covers banking services, allowing Swiss institutions to continue accepting deposits and offering lending services to high-net-worth individuals and professional clients in the UK, while applying Swiss law for these activities. This legal certainty strengthens Swiss financial service providers’ ability to serve wealthy private clients, who represent a substantial share of their cross-border business.

 

UK

 

For UK firms, the BFSA opens unprecedented access to the Swiss wholesale insurance market, creating new opportunities for growth. UK insurance companies can provide a broad range of wholesale services directly to Swiss corporate clients under a deference framework, relying on UK regulation and supervision rather than duplicating Swiss requirements. A key benefit is the exemption for UK insurance brokers from the Swiss local presence requirement introduced in 2024, allowing them to operate seamlessly on a cross-border basis without establishing a branch in Switzerland.

 

UK investment service providers also gain targeted simplifications. The BFSA removes duplicative requirements such as registration of client advisers or local exams for services to institutional and professional clients, as well as to high-net-worth individuals who opt to be treated as professional clients. This streamlined approach reduces administrative burdens and facilitates easier provision of services in Switzerland.

 

In banking, UK advisers can temporarily provide services to high-net-worth private clients within Switzerland without registration requirements, under specified conditions. The BFSA also reinforces existing openness in asset management, preserving portfolio delegation and supporting the UK’s position as a leading global center for asset management.

 

Conclusion

The signing and entry into force of the BFSA marks a significant step towards greater collaboration and efficiency in the financial services sector between the UK and Switzerland. By streamlining cross-border transactions and reinforcing supervisory cooperation, the Agreement creates a stable and predictable environment for firms operating in both markets. Mutual recognition serves as the foundation of this framework, reducing regulatory overlap while safeguarding financial stability, market integrity and investor protection.

 

For market participants, the BFSA is not a distant prospect but an immediate reality. Firms should reassess their cross-border strategies, conduct thorough analyses, and prepare for market entry under the new rules. Proactive adaptation will unlock new opportunities and enable institutions to expand their client base across both jurisdictions.

 

Ultimately, the BFSA sets a precedent for modern financial agreements, balancing openness with regulatory independence and paving the way for innovation and growth. The changes introduced by the BFSA are not just future possibilities but present realities that demand strategic action to secure enhanced market access and a competitive edge in the UK and Swiss financial sectors.

Summary

The Berne Financial Services Agreement (BFSA), effective as of 1 January 2026, establishes mutual recognition of UK and Swiss financial regulations, streamlining cross-border services in banking, investment, asset management, insurance and market infrastructure. Moving beyond EU equivalence, it adopts an outcomes-based approach, reducing compliance burdens and fostering regulatory trust. The BFSA sets a global precedent for modern financial cooperation, enabling firms to expand wholesale operations efficiently while safeguarding stability and investor protection. This landmark accord creates strategic opportunities for both markets and signals a new era of international financial integration.

Acknowledgement

We kindly thank Micol Paloschi for her valuable contribution to this article.

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