What Swiss insurers need to consider when they receive ATAD II questions from asset managers

Rules introduced in EU Member States through the Anti-Tax Avoidance Directive (ATAD II) have been in force since 1 January 2020 and have proven to widely impact how alternative investment funds in Europe are structured.

Through the introduction of ATAD II, the investor’s tax treatment of the fund has become very relevant in fund structuring and may even impact the performance of the fund in a negative manner. Consequently, managers of European investment funds have adapted their onboarding documentation to request the necessary tax information from their investors. In many cases, managers have also reached out directly to their clients to understand their tax situation. While in many cases ATAD II only increases the amount of information flowing between parties, in quite a few cases the investor’s tax treatment of the investment has material performance impacts requiring appropriate restructuring solutions.

Swiss insurers should understand their tax position under ATAD II rules and be prepared to respond correctly to questions from asset managers and to efficiently address challenging onboarding requirements. Swiss insurers may also want to revisit existing policies and procedures applied when investing in EU investment funds. 

Swiss insurers should consider a process within the organisation that ensures that teams dealing with onboarding documentation are aware of ATAD II implications. Responding on a best effort basis may not be enough, but a minimum awareness of ATAD II is key to efficient processing.

Talk to us if you want to better understand the issue and need help understanding what these questions mean for your organisation.

At PwC Switzerland we have a dedicated Swiss-based team that understands your situation and is well placed to help you find efficient and pragmatic solutions.