Martin Hess

Künzi Hess MacNab

Zurich www.khm-partners.ch

martin.hess@khm-partners.ch Tel: +41 44 420 19 20

Biography

Martin Hess is a partner at Künzi Hess MacNab attorneys-at-law. He specialises in financial services and capital market law, fintech, DLT and DeFi. Before that, Martin was a partner in two Zurich-based law firms for more than 20 years, and a legal adviser to the Swiss National Bank (Central Bank) for seven years. At the University of Zurich, he served as research assistant and earned his doctorate summa cum laude in 1984.

Who inspired you to pursue a legal career?

My parents, who were both in teaching professions. I was looking for a profession that allows implementing ideas and concepts, not only explaining them.

What excites you the most about your role as financial services lawyer?

It is intellectually challenging and highly emotional. Most projects are the expression of a vision or a hope of the persons behind it. Handling emotions is important for handling clients.

What trends are currently developing in Swiss banking law?

Digitalisation changes the way in which financial institutions communicate with their client. The human interface is vanishing. Cost reduction remains a target. Cybersecurity becomes important.

Switzerland is not part of the European Economic Area or Union and so the equivalence between Swiss and EU law and the access to EU markets for Swiss financial institutions remains of core importance. Autonomous copying of EU law such as MiFiD and MiFiR in the Swiss Financial Services Act and in the Financial Institutions Act will remain a topic for the future. Anti-money laundering and counter terrorism regulation is constantly developing under the guidance of standard setters such as the FATF. We hope that the tendency to consider each and every financial activity of daily life as financial intermediation will come to an end.

How are recent steps in digitalisation shaping the financial sector and how are you adapting your practice accordingly?

Switzerland’s recent Distributed Ledger Technology act provides clarity and certainty on various aspects regarding distributed ledger technology and the business models based on such technology.

Financial services will not become fully digitalised or decentralised, but will always have a human element, ie, sound judgement and control over the technology in place. Standardised operations like payments or settlement will rather be performed by algorithms of decentralised systems than by centralised systems (eg, CSD, CCP). There is always a human factor in such systems – be it just the person who designs the smart contracts. The regulators will want to hold these persons responsible.

Our law firm and our partners have for many years been active in fintech, even at a time where this term did not exist yet. In our view, fintech and banking will become the same, at least for regulated financial services.

How is the automatic exchange of banking Information changing Swiss banking practice?

The infrastructure for reporting the tax information had to be developed and implemented. Smaller banks and smaller asset managers have disappeared, also because of more strict regulations. But asset management for foreign clients remains a strong business for Swiss banks. Given that the monies are now reported and taxed, the performance of the financial institutions is more challenged by the customers, litigation against a non-performing bank is more likely.

How does Künzi Hess MacNab Attorneys at Law distinguish itself from the competition?

Künzi Hess MacNab is a partner-only law firm. Clients work exclusively with attorneys who have long-standing experience in private practice and within the financial services industry, ranging from 10 years to more than 30 years. Künzi Hess MacNab is known for its unique combination of legal skills and its ability to provide swift implementation solutions of the legal analysis.

How do you see your practice developing in five years?

Künzi Hess MacNab is a team of lawyers with different cultural backgrounds (Vietnam, various European countries, various European languages), a broad and sustainable age range across the partnership, a majority of female partners (80 per cent) and a majority of parents in our partnership. We strive for providing quality work, avoiding becoming victims of the billable hours system. We try to keep this balance, whether this leads to growth or not is not decisive.

What advice would you give to the up-and-coming generation of financial services lawyers?

Do not expect an easy job. Swifter and more efficient technology as well as cautious regulators will lead to constant developments also in the future. New business models will come and go. Do not concentrate on one speciality. Keep track of developments. Stay curious and do not hesitate to question the projects presented by your clients if you have doubts.

WWL says: Martin Hess is an “esteemed and experienced” practitioner in the world of fintech who is known for providing top-notch advice to his clients.