FOGAIN covers investors up to €100,000 when a firm cannot return the cash or instruments they entrusted to it; it does not cover an investment going wrong. We explain who must join (EAFs and EAFNs included since Law 6/2023), what it costs and how to explain it to your clients without creating false expectations.
Questions about FOGAIN at your firm? We’ll answer them for free
Membership, contributions, client information or how it fits into your authorization application: tell us about your case and we will give you an informed answer.
Fund membership does not stand alone: it appears in the authorization application, the annual budget and client information. Here is how each piece fits.
FOGAIN contributions sit alongside reporting, audit, fees and staff training. Here is the full map of ongoing compliance, where the guarantee is one more cog in the machine.
Fund membership comes with the firm’s registration: if you are setting up your EAF, budget for the guarantee from the initial financial plan and avoid a surprise in your first year.
The financial advisory firm (EAF), required to join FOGAIN since Law 6/2023.
The national firm type also joins the fund: client protection makes no distinction between EAFs and EAFNs.
The procedure in which the CNMV checks, among many other items, the plan to join the guarantee fund.
FOGAIN is one more layer of the protection system: know them all so you can inform your clients accurately.
Founders, compliance officers and investors come to the fund with different questions. These are the ones we hear most often at our firm.
“I’m finalizing the financial plan for my future EAF and need to budget for the guarantee: when the obligation arises, how the contributions are calculated and where it fits in the authorization application.”
“I thought the fund was a matter for securities brokers and broker-dealers, but Law 6/2023 also requires me to join as an EAFN. I want to understand exactly what it protects for my clients and what I should tell them.”
“My worry isn’t the contributions: it’s the sales team describing the coverage wrongly and us ending up promising a guarantee the fund doesn’t provide. I need approved, complaint-proof wording.”
“My firm mentions FOGAIN and I understood that if my funds fell in value, I’d get money back up to a certain amount. I’ve been told that’s not what it’s about, and now I want to know what it really covers.”
Few parts of the financial system are explained as poorly as guarantee funds. Clearing up these three points prevents complaints, conduct penalties and disappointed clients.
“It covers my losses”: no. FOGAIN does not compensate for market risk: if a recommended product falls in value, that loss is the investor’s. The guarantee applies when the firm cannot return the cash or instruments entrusted to it, in the cases provided for by law.
“It’s the same as the deposit guarantee”: it isn’t. The bank deposit guarantee fund and FOGAIN are separate mechanisms, covering different entities and different events. Mixing them up in marketing creates expectations that cannot be met.
“It doesn’t apply to my EAF”: since Law 6/2023, EAFs and also EAFNs must join FOGAIN and pay its contributions. Budgeting for it late or communicating it poorly is a classic mistake in the first years of activity.
| Event | Covered by FOGAIN? | Details |
|---|---|---|
| The firm cannot return the cash or securities entrusted to it | Yes | This is the core of the guarantee: legally defined events linked to insolvency or to the inability to return assets, with coverage of up to €100,000 per investor. |
| Investments lose value (the market falls, the product performs badly) | No | Market risk is borne by the investor. No guarantee fund turns a bad investment into an insured one. |
| Disputes about the service received (poor advice, fees, information) | No | These follow a different route: a complaint to the firm and, where applicable, to the CNMV complaints service, whose reports are not binding. |
We review how FOGAIN appears in your application, your contracts, your website and your sales pitch; we correct anything that overpromises and build the contributions into your compliance calendar. A real guarantee, realistic expectations.
The Investment Guarantee Fund (FOGAIN) is Spain’s scheme for protecting the clients of investment firms. Its role is to compensate investors, within the legal limits, when a member firm cannot return the cash or financial instruments they had entrusted to it, in the cases set out in the rules.
It is worth grasping this from the start: it is a guarantee against non-restitution (failure to return assets), not against how the markets perform.
As a general rule, Spanish investment firms. And since Law 6/2023 the obligation expressly extends to EAFs and also to EAFNs, even though the latter are not investment firms: lawmakers wanted clients of financial advice to have the same safety net.
For a project at the authorization stage, this means that membership and its costs are part of the plan from day one, as we explain in how to set up an EAF.
It covers the legally defined cases in which the member firm cannot return the client’s cash or instruments (situations generally linked to insolvency or to the inability to return assets), with coverage of up to €100,000 per investor.
The amount is calculated per investor under the fund’s rules. For larger amounts and portfolios, the coverage does not multiply: it is a protection limit, not tailor-made insurance.
No, and this is the most widespread misconception. If a recommended investment fund falls 20%, that loss is part of the market risk the investor takes on when investing: FOGAIN does not step in.
The distinction matters on both sides of the table. Investors need to know what protection they really have; and firms must explain it precisely, because suggesting that the guarantee covers returns can turn into a conduct issue and a problem under the rules on advertising of financial products.
They are parallel mechanisms for different worlds: one protects depositors of credit institutions; FOGAIN protects clients of investment firms (and of EAFs and EAFNs) in non-restitution cases.
When communicating with clients, do not mix them up: each has its own covered entities, trigger events and rules. If your firm works with third-party custodians or banks, explain clearly which layer protects what; we cover the system as a whole in financial consumer protection.
Member firms pay annual contributions set according to the criteria in the fund’s rules, generally linked to each firm’s activity. There is no single figure that applies to all firms: it depends on the case and the financial year.
In practice, treat them as a fixed license cost: a line in the annual budget, payment on time and receipts filed within the compliance calendar we describe in EAF ongoing obligations.
Coverage is triggered when one of the legal non-restitution events occurs and is handled through the fund’s own procedures, with the fund determining the amounts under the applicable rules. Investors will need to prove their position with the firm (contracts, statements, receipts).
It is important not to confuse the routes: if the complaint is about the service received (poor advice, fees, lack of information), the route is not FOGAIN but a complaint to the firm and then to the CNMV complaints service, whose reports are not binding. We explain it in CNMV complaints.
With surgical precision: what it protects (non-restitution), up to what amount (€100,000 per investor) and what is excluded (investment performance). That message must be consistent across the advisory agreement, the website, sales presentations and what your team says.
Two rules that save a lot of trouble: never use the word “guaranteed” in relation to returns, and train the sales team with approved talking points. Explained well, the guarantee builds trust; explained badly, it creates the next complaint.
Three workstreams sum up what a firm must do with FOGAIN: build it into the project, pay for it without surprises and communicate it without overstating it.
From the authorization application onward, the guarantee appears in the financial plan and in the firm’s documentation. Treating it as part of the design, not as an afterthought, avoids mismatches with the CNMV and with the budget.
Annual contributions in the calendar, receipts on file and a review of every communication from the fund. This is the quiet part: fifteen well-organized minutes a month versus an incident if it is neglected.
Approved wording on what is and is not covered, applied in contracts, the website and sales scripts. This is where FOGAIN stops being a cost and becomes a defensible source of trust.
If you are building the firm, integrate all of this from the outset with how to set up an EAF; if you are already operating, the full framework of duties is in EAF ongoing obligations.
The 10 steps to set up your financial advisory firm with the CNMV, with the evidence you must be able to show at each one. Keep it handy throughout the project.
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With these concepts clear, you will be able to read the fund’s rules, budget for your contributions and explain the coverage to any client without slipping up.
Spanish scheme that compensates the clients of member firms when those firms cannot return the cash or instruments entrusted to them.
Maximum amount of the fund’s general guarantee for each investor, calculated under the fund’s rules.
Legally defined situations in which the firm cannot return to the client what was entrusted to it, generally linked to insolvency.
Changes in the value of investments are borne by the investor. No guarantee turns market losses into recoverable amounts.
Mandatory admission of the firm to FOGAIN, with the corresponding documentation and contributions.
Periodic contributions by member firms, set according to the criteria in the fund’s rules.
Spanish investment firms make up the fund’s traditional scope: broker-dealers and securities brokers, portfolio management companies and EAFs.
The national advisory firm type, although not an investment firm (ESI), must also join since Law 6/2023: its clients deserve the same protection.
The CNMV channel for disputes about the service received; it issues non-binding reports. It is not the FOGAIN route.
The firm has been a member of the fund since its registration as an EAF, EAFN or other investment firm (ESI), with no time gaps between authorization and membership.
Membership documents on file and a consistent reference in the authorization application.
Annual contributions are paid on time in line with the fund’s assessments and built into the compliance budget.
Assessments received, proof of payment for each financial year and an approved budget line.
Contracts and pre-contractual information describe the actual coverage: non-restitution events and the €100,000 per-investor limit, with no promises about returns.
Clauses reviewed by legal counsel and version-controlled documents.
No sales material suggests that the guarantee covers market losses or uses the coverage as a selling point for returns.
A pre-approval process for campaigns and a repository of approved materials.
All client-facing staff explain the coverage the same way: what it protects, up to what amount and what it excludes, routing complaints correctly.
Approved talking points, training delivered and recorded, and periodic sampling of communications.
None of them costs money today; any of them can the day a client complains or the supervisor reviews your communications.
FOGAIN protects a very specific situation; investor protection and the firm’s compliance are built from many more pieces. These pages complete the picture depending on where you are.
The authorization guide where fund membership sits where it belongs: within the financial plan and the application.
Contributions, reporting, audit, training and policies: the full calendar into which the fund contributions fit.
Transparency, conduct and complaint routes: the full system around retail investors in Spain.
The route for service disputes, separate from the fund’s guarantee: procedure and non-binding reports.
For the full picture of where your firm fits, review the EAF authorization, the EAFN authorization or the investment firm (ESI) authorization that matches your firm type; and if you are comparing options, start with EAF vs securities broker.
Tell us where your firm stands (project, authorization in progress or already operating) and we will answer your questions about FOGAIN.
The Investment Guarantee Fund (FOGAIN) is the safety net for clients of Spanish investment firms: it compensates investors, up to €100,000, when a member firm cannot return the cash or financial instruments entrusted to it in the cases provided for by law. Law 6/2023 of March 17 widened its scope with a decision that matters for the advisory sector: EAFs and EAFNs must also join the fund. Understanding what it covers, and above all what it does not, is essential both for investors who entrust their assets and for the firm that has to explain it and pay for it.
The fund’s traditional scope consists of Spanish investment firms: broker-dealers (sociedades de valores), securities brokers (agencias de valores), portfolio management companies and financial advisory firms. The change introduced by Law 6/2023 was to extend the obligation to the EAFN, the national advisory firm type, which is not even an investment firm: lawmakers made it a priority for clients of financial advice to have the same safety net regardless of their adviser’s firm type. For projects going through authorization, the practical consequence is that membership and its cost must be in the plan from the application stage, as we explain in how to set up an EAF and in investment firm (ESI) authorization.
The guarantee is triggered in the legally defined cases in which the member firm cannot return to the client the cash or instruments the client entrusted to it (situations generally linked to insolvency), with general coverage of up to €100,000 per investor, calculated under the fund’s rules. It is therefore protection against the failure of the firm as the holder of the client’s trust, not against how products perform. For EAFs, one clarification is worth making: since they advise without holding client assets, their clients keep their positions with third-party banks or brokers, and even so the EAF’s membership of the fund is mandatory by law.
FOGAIN does not cover market losses: a fall in a fund, a share or any recommended product is part of the risk the investor takes on, and no guarantee turns it into a recoverable amount. Nor is it the route for disputes about the service (poor advice, poorly disclosed fees, incomplete information), which are handled through a complaint to the firm itself and, where applicable, to the CNMV complaints service, whose reports are not binding, as we explain in CNMV complaints. For the firm, communicating this boundary precisely is not a courtesy: it is a conduct requirement linked to advertising of financial products and financial consumer protection.
Membership entails annual contributions set according to the criteria in the fund’s rules, generally linked to each firm’s activity. In day-to-day management they work as a fixed license cost, alongside supervisory fees, audit and staff training: a budget line, payment on time and a receipt on file. The full calendar discipline, and the exact place these contributions take within it, is set out in EAF ongoing obligations; and if your firm is still choosing its type, the starting point is EAF authorization.
Key legislation, linked to the official text:
Legislation and links reviewed in .