Retrocessions And Execution-Only – Validity Of A Waiver

In a new decision 4A 574/2023, 4A 576/2023, dated 24 May 2024 and published on 26 June 2024, the Swiss Federal Supreme Court confirms and specifies the validity of a waiver clause in relation with execution-only mandates as well as investment advisory agreements.

The Swiss Federal Supreme Court has previously ruled that, in the context of asset management agreements, a waiver is only valid if the amount of retrocessions in relation to the assets under management is disclosed.

Recently, the Swiss Federal Supreme Court ruled that a waiver indicating the amount of retrocessions in reference to an applicable percentage per class of assets (without reference to the assets under management) was "not insufficient" in case of execution-only mandates (4A_496/2023, dated 27 February 2024).