Glossary
Appropriateness Assessment
The Appropriateness Assessment is the review prescribed under Art. 11 FinSA to determine whether a financial instrument matches a client's knowledge and experience. It applies when a financial services provider gives Investment Advice on individual transactions without taking the entire client portfolio into account. Where client orders are merely executed or transmitted, no assessment is required (Art. 13 FinSA).
At a glance
- The Appropriateness Assessment is narrower than the Suitability Assessment: it evaluates only the client's knowledge and experience with the relevant product type, not their overall financial situation (Art. 11 FinSA).
- Where the service is limited to executing or transmitting client orders, the financial services provider informs the client beforehand that no Appropriateness Assessment or Suitability Assessment takes place (Art. 13 FinSA).
Frequently asked questions
When it gives Investment Advice on individual transactions without taking the entire client portfolio into account (Art. 11 FinSA). Only knowledge and experience are then collected, not financial circumstances or investment objectives. If the advice takes the portfolio into account, or the service is Discretionary Asset Management, the Suitability Assessment applies (Art. 12 FinSA). Where client orders are merely executed or transmitted, neither assessment is required (Art. 13 FinSA).
Part of the topic
Financial Advice
Sources: FINMA · Classified Compilation (fedlex)
This entry is for general information purposes only and does not constitute investment, legal or tax advice. It is a simplified summary of the legal position and tax treatment.