Mutual recognition

In order to protect investors in the Swiss capital market, the AOA also has extraterritorial effect. Foreign audit firms are subject to oversight by the FAOA if they audit foreign companies that use the Swiss capital market. This does not apply if the foreign audit firm is already supervised by an oversight authority recognized as equivalent by the Federal Council (Art. 8 para. 2 AOA).

The oversight authorities recognized as equivalent by the Federal Council are listed in Annex 2 AOO.

The following decisions by the EU Commission are relevant in connection with the recognition of the FAOA:

Green light for negotiations with the FAOA         
In its decision of February 5, 2010, the EU Commission gave Member States the green light for negotiations on cooperation agreements. In addition to Japan and Canada, the decision also covers Switzerland and the FAOA respectively.

Recognition of the equivalence of Swiss supervision of auditing       
As a second step, the EU Commission decided on January 19, 2011, to recognize Switzerland’s, respectively the FAOA’s, oversight system for auditors and audit firms as equivalent.

This marked the successful conclusion of a three-year recognition process for cooperation with the EU.