Successful Transactions with PwC


PwC Corporate Finance advises Giroflex on the sale of the Group and its subsidiaries to Flokk A.S., a portfolio company of Triton

Zurich | A team of PwC Switzerland led by Sascha Beer, Partner Corporate Finance/ M&A, acted as lead advisor to Giroflex Holding AG, a manufacturer of award-winning office chairs generating c. EUR 42 million of revenues with c. 200 employees in Switzerland, Belgium, Germany, France and the Netherlands.

Flokk is one of the leading office chair manufacturers in Europe with sales of c. EUR 140 million and 550 employees. Acquired by Triton, a private equity fund, in 2014, the company has since then made several add-on acquisitions.

According to Flokk’s managing director, Lars Roiri, the acquisition allows Flokk to expand outside of Scandinavia with Giroflex complementing Flokk’s existing activities and geographic footprint. The acquisition is part of Flokk’s goal to double its turnover within three to five years via both organic growth and further acquisitions.

The team

Sascha Beer
Partner, Corporate Finance/ M&A

Marc C. Buser
Senior Manager, Corporate Finance/ M&A

Lasse Stünitz
Senior Consultant, Corporate Finance/ M&A

Nikola Gozze
Consultant, Corporate Finance/ M&A

“Royalty Restrictions“ in Germany

11 July 2017

Germany has recently introduced new rules that will restrict the tax deductibility of related-party cross-border royalty payments if these payments are benefiting from a low taxation triggered by a harmful preferential tax regime in the country of the recipient.

Based on these new rules, such royalty expenses incurred after 31 December 2017 will no longer be fully deductible in Germany if the relevant income is subject to an effective tax rate of less than 25%:

In detail

For example, if the royalty income is subject to a preferential 10% effective tax rate, 60% of the royalty payments would not be deductible at the German taxpayer level.

However, if a recipient of cross-border royalty payments is subject to the regular tax rate (i.e. no preferential tax regime applies), the royalty restriction rule is not applicable, even if the effective tax rate is less than 25%.

Furthermore, patent box regimes which comply with the OECD “nexus” approach (i.e. under foreign law the preferential tax rate is only granted following an OECD-compliant “nexus” approach) are exempt from the new rule. A patent box of this kind is likely to be introduced in Switzerland in the context of tax package 17 (former corporate tax reform III).

It should however be noted that tax package 17 and therefore an
OECD-compliant Swiss patent box will probably not be introduced before 2020. Consequently, German royalty payments incurred between 1 January 2018 and the introduction of such a patent box in Switzerland could be subject to the new German royalty restriction rule if such royalties benefit from a Swiss preferential tax regime. The following regimes in Switzerland should be investigated in particular to establish whether or not they qualify as harmful preferential tax regimes:

  • Nidwalden IP Box
  • Mixed companies
  • Holding companies
  • Principal companies

An investigation into the impact of the new German limitation rules is recommended in order to determine their impact and to decide whether restructuring should be conducted before 1 January 2018.

In summary, there is still some uncertainty about how the new rules will be interpreted and applied. However, for now it can be assumed that all Swiss preferential regimes may potentially cause issues under the German royalty restriction rule.

There are, however, certain planning ideas which can help mitigate and/or reduce such issues. These solutions may depend on the very specific circumstances of your group and we advise you to have them analysed by your PwC tax consultant on a case-by-case basis.

For a more detailed discussion of how this might affect your business, please contact:

Armin Marti
Partner, Leader Corporate Tax
Tel. +41 58 792 43 43

Stefan Schmid
Partner, Tax & Legal
+41 58 792 44 82

Roman Brunner
Partner, Tax & Legal
+41 58 792 72 66

Urs Brügger
Partner, Tax & Legal
+41 58 792 45 10

Reto Inauen
Senior Manager, Tax & Legal
+41 58 792 42 16

EUDTG Newsletter May – June 2017

EU direct tax law is a fast developing area. This presents taxpayers, in particular groups and multinational corporations that have an EU or European Economic Area (EEA) presence, with various challenges.

The following topics are covered in this issue of EU Tax News:

CJEU Cases

  • Belgium: CJEU judgment in X concerning the Belgian fairness tax
  • Belgium: CJEU judgment in Van der Weegen and Pot concerning the tax exemption applicable to income from savings deposits
  • France: CJEU judgment in AFEP concerning the French contribution tax
  • Luxembourg: CJEU judgment in Berlioz concerning exchange of information upon request

National Developments

  • Austria: Administrative High Court disallows import of foreign (final) losses despite transfer of place of management
  • Germany: Federal Fiscal Court refers §6a RETT Act to CJEU as potential State aid
  • Germany: Federal Fiscal Court denies deduction of final losses according to EU law
  • Italy: Amendments to the NID and Patent Box Regime: conversion into law with revisions
  • Poland: Ministry of Finance publishes warning on aggressive tax planning structures
  • Spain: Supreme Court issues preliminary ruling about tax on activities that affect the environment
  • Switzerland: Federal Council presents basic parameters of the renewed planned tax reform
  • United Kingdom: Upper Tribunal Tax and Chancery decision on the Coal Staff Superannuation Scheme Trustees

EU Developments

  • EU: ATAD II Directive formally adopted
  • EU: European Commission proposes mandatory disclosure rules for intermediaries
  • EU: ECOFIN Council of 23 May 2017: agreement on Double taxation dispute resolution mechanism in the EU
  • EU: ECOFIN Council of 16 June 2017: Main results
  • EU: European Parliament PANA Committee issues draft report and draft recommendations
  • EU: Public CBCR: European Parliament ECON and JURI Committees adopt joint report
  • Italy: EU Tax Commissioner Moscovici concludes that Italian flat tax for high net worth individuals does not appear to constitute harmful tax competition
  • Spain: European Commission starts infringement procedure on state liability for breach of EU law

Fiscal State aid

  • EU: European Commission and China start dialogue on State aid control
  • EU: European Commission adopts annual Competition Policy Report for 2016
  • Hungary: Advertisement Tax Act aligned to comply with EU State aid rules
  • Spain: CJEU judgment on tax exemptions for Catholic Church
  • United Kingdom: CJEU judgment on the Gibraltar Betting and Gaming Association


Read the full newsletter


This EU Tax Newsletter is prepared by members of PwC’s international EU Direct Tax Group (EUDTG).

Further information about our service offerings in EU taxes:


Armin Marti
Partner Tax & Legal Services, Leader Corporate Tax Services
+41 58 792 43 43

Anna-Maria Widrig Giallouraki
Senior Tax Manager
+41 58 792 42 87

Latest Level 3 ESMA Q&As related to MiFID II/MiFIR – July 2017

ESMA published and updated in the last couple of days additional Level 3 Q&A papers. Due to the specification and clarification purposes of the Level 3 papers, this should help you during the implementation phase and could clarify open questions. Please find the relevant ESMA Q&As from 7 July and 10 July 2017 listed below.

PwC provides you with this newsletter an overview of the latest questions related to the following topics:

  1. Investor protection and intermediaries topics (10 July 2017)
  • Best execution
  • Recording of telephone conversations and electronic communications
  1. Market structures topics (7 July 2017)
  • Direct Electronic Access (DEA) and algorithmic trading
  • Multilateral and bilateral systems
  • Access to CCPs and trading venues
  1. Data reporting (7 July 2017)
  • Field 14 and Field 17 – Total issued nominal amount
  • Field 30 – Quantity
  • Reference data for financial instrument
  • Transaction reporting
  • Order record keeping
  1. Commodity derivatives topics (7 July 2017)
  • Position limits
  • Position reporting

Read the whole article.

We are happy to discuss with you any thoughts and issues or are happy to review your solutions with regard to MiFID II and MiFIR.

Please do not hesitate to contact us.

Günther Dobrauz
Leader Legal FS Regulatory & Compliance Services
+41 58 792 14 97

Michael Taschner
Senior Manager
PwC Legal FS Regulatory & Compliance Services
+41 58 792 23 25

Orkan Sahin
PwC Legal FS Regulatory & Compliance Services
+41 58 792 19 94

Liechtenstein has signed an additional DTA with Monaco

On 29 June 2017 the Government of the Principality of Liechtenstein issued a press release stating that Liechtenstein has signed an additional Double Taxation Agreement (DTA) with Monaco. The DTA between Liechtenstein and Monaco is intended to increase the legal certainty for investors and strengthen the close cooperation between the two countries.

The DTA is based on the current international OECD standard. It takes into account the results of the OECD/G20 BEPS project, which is intended to prevent tax avoidance in a cross-border context. The exchange of information is regulated based on international standards, whereby the automatic exchange of information (AEOI) will be carried out in accordance with the framework of the Multilateral Competent Authority Agreement (MCAA).

We assume that the new DTA with Monaco will be approved this year by the Landtag of the Principality of Liechtenstein, which would allow it to enter into effect as of 1 January 2018.


Martin Meyer
PwC | Director
Office: +41 58 792 42 96
Mobile: +41 79 348 36 13
PricewaterhouseCoopers GmbH
Austrasse 52 | Postfach | FL-9490 Vaduz



Ralph Bieri
PwC | Senior Manager
Office: +41 58 792 72 76
Mobile: +41 79 643 14 37
PricewaterhouseCoopers AG
Vadianstrasse 25a | Neumarkt 5 | 9001 St. Gallen

Newsflash: The Swiss Federal Council has published some key amendments to the current version of the Swiss Financial Market Ordinance (FinfraV/FMIO)

The new regulations on initial and variation margins for OTC-derivatives, the platform trading obligation, the delayed recording and reporting obligation for securities dealers and foreign market participants, and the prolonged exemption for pension funds and investment funds for retirement.

The Swiss Federal Council has published some key amendments to the current version of the Swiss Financial Market Ordinance (FinfraV/FMIO) affecting a wide variety of market participants such as counterparties of OTC-derivatives, securities dealers, pension funds, and investment funds for retirement.

The new regulations on initial and variation margins for OTC-derivatives under the Swiss Financial Market Infrastructure Act FinfraV/FMIO will enter into force on the 1st of August 2017. The variation margin requirements under FinfraV/FMIO will enter into force on the 1st of September 2017 and will affect all counterparties to OTC-derivatives not being small non-financial counterparties (NFC-). The key new requirements under the new initial and variation margins regulations will be as follows:

  • The new regulations are much stronger aligned to the final initial and variation margin regulations under EMIR, the corresponding European regulation. The new Swiss regulations do however not impose an obligation to review the legal opinions applicable to OTC-contracts on an annual basis. This is a welcomed alleviation for the Swiss market participants.
  • It is now generally possible to re-use initial margins granted in the form of cash if they are held in custody with a third party custodian bank or a central bank.
  • It is now possible to change the method for the calculation of the initial margin in each derivative category also after a mutual agreement on such calculation has been achieved.
  • There will no mandatory haircut of 8% anymore if the variation margin paid in cash is not provided in the mutually agreed currency.
  • The obligation to exchange initial and variation margins for options on equity, indexes or similar equity derivatives will apply only beginning as of the 4th of January 2020.
  • Units in UCITS funds can now also be used for initial and variation margin purposes.
  • No initial margin must be provided anymore for the foreign exchange component of Cross Currency Swaps.
  • OTC-derivatives related to covered bonds are under certain conditions totally or at least partially exempted from the initial and variation margin obligation.

The platform trading obligation, that requires that certain specifically designated derivatives must be traded on a trading venue, has formally set in force. There is however currently no derivatives category that has been designated as subject to the trading obligation on a platform.

Another important alleviation for securities traders and foreign market participants at Swiss trading venues is the delayed entry into force of the recording and reporting obligations. These obligations will now only enter into force on the 1st of October 2018 for Swiss securities dealer. The transactions and orders that have occurred in between the 1st of January 2018 and the 30th of September 2018 will however have to be recorded and reported no later than until the 31st of December 2018 (“backloading”). The recording and reporting obligations will enter into force for foreign branches of Swiss securities dealers and foreign participants of Swiss trading venues as of the 1st of January 2019.

The exemption for pension funds and investment foundations for retirement from the clearing obligation has been extended until the 16th of August 2018.

Please do not hesitate to contact us for a free consultation on any of these new provisions.


Martin Liebi
Head Capital Markets
0041 76 341 65 43

New Swiss FinTech rules

Switzerland adopts revised banking regulations in order to facilitate the business activities of “FinTech” companies

On February 1, 2017 the Federal Council initiated a public consultation suggesting modifications to Swiss banking regulations. The purpose of the proposed revision was to create appropriate regulations for FinTech companies operating outside the traditional financial sector, taking into account the specific risk potential of their respective business models. The proposed revision included amendments to both the Banking Act (“BA”) and the Banking Ordinance (“BO”). The public consultation lasted until May 2017.

On July 5, 2017 the Federal Council finally adopted the new Swiss regulatory framework with regard to the BO. The new regime will formally enter into force on August 1st, 2017 so that FinTech companies will be able to benefit from these new rules as quickly as possible.

The amended rules provide for the following:

  1. Settlement account exemption: An exemption for settlement accounts will be created. This will allow companies to hold funds in a settlement account for 60 days without the operation of such account being deemed an acceptance of public funds subject to licensing under the BA (Art. 5 para 3 let. c BO). The BO in its current version did not contain a 60-day period of this kind, thereby creating some uncertainty.
  2. Innovation space (“sandbox”): Companies are allowed to hold public deposits of up to CHF 1 million without having to obtain a banking license (“sandbox”). Consequently, holding public funds of less than CHF 1 million does not qualify as “operating on a commercial basis”, which is a requirement in order to fall within the scope of the BA and the BO (Art. 6 para 2 let. a BO). According to the BO in its current version, taking public funds from more than 20 persons is deemed as “operating on a commercial basis”. Under the revised version of the BO, the number of persons providing funds is irrelevant as long as the threshold of CHF 1 million is not exceeded. Furthermore, the funds raised may neither be invested nor be subject to interest payments (Art. 6 para 2 let. b BO). Finally, the persons providing the funds must be informed that the respective business model is not subject to supervision by the Swiss Financial Market Supervisory Authority (FINMA) and that the rules on deposit insurance do not apply (Art. 6 para 2 let. c BO). This new innovation space will enable FinTech companies to try out experimental new business models without immediately having to obtain a banking license.

All in all, these innovative amendments to the BA and the BO will substantially facilitate the operation of FinTech business models in Switzerland. Moreover, the revision of the BA and the BO is further evidence of the Swiss government’s commitment to constantly improving and redesigning the regulatory environment in order to boost Switzerland as a major FinTech hub.

Your contacts:

Guenther Dobrauz
Partner|Leader PwC Legal Services Switzerland
Tel. +41 58 792 1497

Tina Balzli
Director|Legal FS Regulatory & Compliance Services
Tel. +41 58 792 1554

Simon Schären
Manager |Legal FS Regulatory & Compliance Services
Tel. +41 58 792 1463

PwC’s Retail & Consumer Roundtable – A Success

«Digitization and Transformation of the Swiss Retail Sector»

On June 30, 2017 PwC Switzerland organised the first of a planned series of Retail & Consumer Breakfast Roundtables at the “Au Premier” in Zurich main station. In his introductory remarks Dr. Andreas Plattner, Director Transactions pointed out that against the background of constant negative press headlines on the state of the Swiss retail industry one could easily despair. Yet, the current fundamental transformation of the sector – largely driven by the fast paced digitisation of the retail value chain – does create opportunities and thus, a silver lining on the horizon.

Dr. Christoph Walser, Director Retail & Consumer Consulting, elaborated on selected highlights of the 6th PwC’s Total Retail Survey, a global consumer study with more than 24’000 respondents from five continents in 29 countries. In his presentation he explained how investment in six areas can help retailers master the challenges ahead and, thus, be better prepared for the future. The central piece of good news for most participants was that stationary retail in Switzerland is not doomed to vanish. However, the future retail store will look distinctly different.

Briefly touching on the need to define an strategy for both retailers and consumer goods manufacturers – irrespective of whether or not Amazon finally enters the Swiss market – Christoph built the bridge to the second input note. Dominic Olonetzky from PwC Digital Services (PDS) explained the evolution and growth of electronic market places both globally and in Switzerland. Revealing how various merchandise categories will be affected differently by these market places Dominic stressed the importance of a clear strategic direction. Direct-to-consumer business models and in-store digitisation, moreover, offer attractive opportunities for Swiss retailers and consumer goods manufacturers alike.

During the following open discussion participants explored in-depth some aspects of the retail transformation and continued the exchange in lively one-on-ones with the presenters after the official end of the event. Judging by the encouraging turn-out rate and positive feedback received from participants the topics presented were spot on and the PwC Retail & Consumer Roundtable a success.

Save the date: the next PwC Retail & Consumer Roundtable is scheduled for November 17, 2017 from 0730-0900.

The team

Dr. Christoph Walser
Director Retail & Consumer Consulting

EU conflict minerals legislation

EU conflict minerals legislation will enter into force on 7 July 2017 and affect all EU importers of gold, tin, tungsten and tantalum (metals and ores).

The new EU conflict minerals regulation (“CMR”) was officially published on 9 May 2017 and will enter into force on 7 July 2017. The CMR introduces new compliance rules for EU importers of gold, tin, tungsten and tantalum, as well as their ores (“metals and minerals”), which stem from conflict-affected and high-risk areas, among others. The CMR is based on the OECD Due Diligence Guidance for responsible supply chains of minerals from conflict-affected and high-risk areas (“OECD Due Diligence Guidance”), including the annexes and supplements thereto. The USA have already introduced their version of a conflict minerals regulation in Section 1502 of the Dodd-Frank Act. This memorandum provides an overview of the key features of the CRM.


The EU Conflicts Minerals Regulation covers gold, tin, tungsten and tantalum, as well as their ores, which stem from conflict-affected or high-risk areas, among others. The CMR will affect all EU importers (or third parties acting on their behalf) of gold, tin, tungsten and tantalum, and those involved in the EU supply chain of the import of these metals and minerals. EU importers or third parties acting on their behalf must comply with the following key obligations: the creation of management and risk management systems, third party audits, disclosure obligations and ex-post checks. Non-EU importers must ensure that EU importers can fulfil their obligations by providing the required information and data for supply chain traceability. The CMR will enter into force on 7 July 2017. Its key obligations will however only come into effect on 1 January 2021.

Who is affected?

The obligations of the CMR will mainly affect EU importers of metals and minerals. An “EU Importer” is any natural or legal person declaring metals or minerals for release for free circulation, or any natural or legal person on whose behalf such declaration is made. Non-EU goods intended to be put on the EU market or intended for private use or consumption within the customs territory of the EU shall be placed under release for free circulation. Release for free circulation entails:

  1. the collection of any import duties due
  2. the collection, as appropriate, of other charges, as provided for under relevant and effective provisions relating to the collection of such charges
  3. the application of commercial policy measures and prohibitions and restrictions insofar as they do not have to be applied at an earlier stage
  4. the completion of other formalities established in respect of the import of goods.

Release for free circulation shall confer the customs status of EU goods on non-EU goods.

It is important to note, however, that EU importers sourcing metals and minerals not stemming from areas deemed to be “conflict-affected or high-risk” must maintain their responsibility to comply with the due diligence obligations of the CMR. In other words, all EU importer of metals and minerals must comply with the requirements of the CMR. Commodities traders who are not EU importers of metals and minerals are still affected by the CMR because they are part of the supply chain. These traders must ensure that EU importers can fulfil their traceability obligations and other duties under the CMR.

Which metals and minerals are affected?

The CMR impacts gold, tin, tungsten and tantalum and their ores (“metals and minerals”) if they exceed a certain threshold volume. EU authorities have outlined the affected metals and minerals in their “Combined Customs Nomenclature”. Please find below an indicative table of the affected CN codes and exempted volumes.

Affected minerals

Description EU CN code TARIC subdivision Exempted threshold volume (kg)
Tin ores and concentrates 2609 00 00 5,000
Tungsten ores and concentrates 2611 00 00 250,000
Tantalum or niobium ores and concentrates ex 2615 90 00 10 To be communicated
Gold ores and concentrates ex 2616 90 00 10 To be communicated
Gold, unwrought or in semi-manufactured form, or as a powder with a gold concentration lower than 99.5% that has not passed the refining stage ex 7108 100

Affected metals

Description CN code TARIC subdivision Threshold volume (kg)
Tungsten oxides and hydroxides 2825 90 40 100,000
Tin oxides and hydroxides ex 2825 90 85 10 To be communicated
Tin chlorides 2827 39 10 10,000
Tungstates 2841 80 00 100,000
Tantalates ex 2841 90 85 30 To be communicated
Carbides of tungsten 2849 90 30 10,000
Carbides of tantalum ex 2849 90 50 10 To be communicated
Gold, unwrought or in semi-manufactured form, or as a powder with a gold concentration of 99.5% or higher that has passed the refining stage ex 7108 100
Ferrotungsten and ferro-silico-tungsten 7202 80 00 25,000
Tin, unwrought 8001 100,000
Tin bars, rods, profiles and wires 8003 00 00 1,400
Tin, other articles 8007 00 2,100
Tungsten, powders 8101 10 00 2,500
Tungsten, unwrought, including bars and rods obtained by simple sintering 8101 94 00 500
Tungsten wire 8101 96 00 250
Tungsten bars and rods, other than those obtained by simple sintering, profiles, plates, sheets, strips and foil, and other 8101 99 350
Tantalum, unwrought including bars and rods, obtained by simple sintering; powders 8103 20 00 2,500
Tantalum bars and rods, other than those obtained by simple sintering, profiles, wire, plates, sheets, strips and foil, and other

 Which jurisdictions are concerned?

The CMR will affect all metals and minerals coming from areas in a state of armed conflict or fragile post conflict, as well as those areas witnessing weak or non-existent governance and security (such as failed states) and widespread and systematic violations of international law, including human rights abuses. It will be left to the discretion of the respective EU importer whether areas should be deemed “conflict-affected” or “high-risk”. An indicative, non-exhaustive, regularly updated list of conflict-affected and high-risk areas will be provided. This list will however not provide absolute clarity on the countries that are considered “conflict-affected” or “high-risk”. The authorities will prepare non-binding guidelines in the form of a handbook for economic operators, explaining how best to apply the criteria for the identification of conflict-affected and high-risk areas.

What are the obligations under the EU conflict minerals regulation?

EU importers of metals and minerals must comply with the supply chain due diligence obligations set out in the CMR, and keep documentation demonstrating their compliance with these obligations, including the results of independent third-party audits. The key obligations are the implementation of:

  1. Management system: A supply-chain policy for metals and minerals stemming from conflict-affected and high-risk areas must be created, adopted and overseen by senior management, and communicated to suppliers. A grievance mechanism as an early-warning risk-awareness system must also be implemented. A chain-of-custody or supply-chain traceability system must be developed that provides the following (and its respective documentation):
      • description of the metal or mineral, including its trade name and type
      • name and address of the supplier to the EU importer
      • name and address of the smelters and refiners in the supply chain of the EU importer
      • in the case of metals – records of the third-party audit reports of smelters and refiners, if available, or evidence of conformity with a supply chain due diligence scheme recognised by the European Commission
      • in the case of minerals only – the country of origin of the minerals and if available, the quantities and dates of extraction, expressed in volume or weight
      • in the case of metals or minerals originating from conflict-affected and high-risk areas – additional information in accordance with the specific recommendations for upstream economic operators, as outlined in the OECD Due Diligence Guidance.


  2. Risk management obligations: Identify and assess the risks of adverse impacts in the mineral supply chain on the basis of information provided on the standards of their supply chain policy. Implement a strategy to respond to identified risks, one that prevents or mitigates adverse impacts by:
    • reporting findings of the supply chain risk assessment to senior management
    • adopting risk management measures consistent with the OECD Due Diligence Guidance
    • implementing a risk management plan and tracking its performance
    • undertaking additional fact and risk assessments for risks requiring mitigation, or after a change of circumstances.


  3. Third party audit obligations: EU importers of metals or minerals shall have audits performed by an independent third party (‘third-party audit’). EU importers of metals shall be exempt from the obligation to carry out third-party audits provided they provide substantive evidence, including third-party audit reports, which demonstrate that all smelters and refiners in their supply chain comply with the CMR or that they source exclusively from smelters and refiners found on the “Globally-Responsible Smelters and Refiners” list (see below, “Acknowledged refiners and smelters”).
  4. Disclosure obligations: EU importers of metals and minerals shall provide reports of any third-party audits to the competent authorities, and provide their immediate downstream purchasers all information gained and maintained pursuant to their supply chain due diligence with regard to business confidentiality and other competitive concerns. Each year, they shall report as thoroughly as possible on their supply chain due diligence policies and practices for responsible sourcing, including on the Internet.
  5. Ex-post checks: The competent authorities will carry out appropriate ex-post checks in order to ensure that EU importers of metals and minerals comply with the established obligations. This includes the examination of the EU importer’s implementation of supply chain due diligence obligations, the examination of documentation and records demonstrating proper compliance and the verification of audit obligations. Ex-post checks will include on-the-spot inspections, such as those done on the premises of the EU importer.

What are the applicable exemptions?

There are multiple applicable exemptions, such as:

  1. Recycled metals: Where an EU importer can reasonably conclude that metals are derived only from recycled or scrap sources, and when it has, with due regard for business confidentiality and other competitive concerns, publicly disclosed its conclusion and described in reasonable detail the supply chain due diligence measures it exercised in reaching that conclusion.
  2. Stocks of affected minerals: When stocks were created in their current form on a verifiable date prior to 1 February 2013.
  3. Recognised due diligence schemes of industry associations and groups: Industry associations and groups may request recognition of their due diligence schemes from the European Commission.
  4. Acknowledged refiners and smelters: A list will be provided that contains the names and addresses of globally-responsible smelters and refiners.

When will the EU conflict minerals regulation and its obligations take effect?

The CMR will take effect on 9 July 2017. Its key provisions will however only enter into force on 1 January 2021. These key provisions are:

  • Compliance with supply chain obligations
  • Management systems obligations
  • Risk management obligations
  • Third-party audit obligations
  • Disclosure obligations
  • Ex-post checks on EU importers

What will be the impact?

The experience obtained from the enforcement of the conflict minerals regulations under Dodd-Frank has shown that it will take a considerable amount of time to plan, structure and implement the requirements set forth in the OECD Due Diligence Guidance. These requirements will affect corporate governance, risk management, supply chain and trading activities.

Please contact our experts on this topic for a free consultation.


Martin Liebi
Director – Head of Commodities Trading Regulation
Tel: +41 58 792 2886

Guenther Dobrauz
Partner Tax and Legals
Tel: +41 58 792 1497

MIFID2: Are you ready for the new era in record-keeping?

With the MIFID2 regulatory regime beginning on 3 January 2018, EU-based financial firms will not only face a new era of heightened record-keeping involving many more records than was previously required, but also the negative effects of new oversight, monitoring, e-discovery and forensics processes for the firm’s clients and regulators. MIFID2 recordkeeping will not just be about expanded content archival – it will deal with its implementation in a way that will help firms best execute processes in a strategic and efficient manner.

The task faced by management teams to ensure their firms are compliant with MIFID2 record-keeping may be daunting given the complexities of the directive and its regulations. We feel this task is best completed by way of an overall approach to record-keeping operations, culminating in the decision to create a firm-level “programme” that is designed to handle all the new requirements posed by MIFID2 – as opposed to ad-hoc, tactically focused processes, which ensure minimal compliance with great risk and little preparation for the processes of oversight, monitoring, e-discovery and forensics. With a strategic programme, firms will have the means to ensure record-keeping compliance and be prepared to effectively deal with the negative effects of MIFID2.

Ultimately, a robust and strategic recordkeeping programme should encompass a process of integrating content archiving into the management of line-of-business applications from the very first day of MIFID2. This process should put operational archiving best practices into place to ensure that records are archived in such a way that their state and inventory are always known – thus making oversight, searching and retrieval easier in the future.

Read the whole article

Contacts PwC:

Guenther Dobrauz
Partner|Leader PwC Legal Services Switzerland
Tel. +41 58 792 1497

Michael Taschner
Senior Manager|Legal FS Regulatory and Compliance Service
Tel. +41 58 792 1087

Philipp Rosenauer
Manager|Legal FS Regulatory and Compliance Services
Tel. +41 58 792 1856

Orkan Sahin
Senior |Legal FS Regulatory and Compliance Services
Tel. +41 58 792 1994

Contacts KSF Technologies:

Michael Imfeld
Managing Partner, Business Development

Allen Frasier
Director of Compliance