2021: Doing Business in Switzerland
Doing Business in Switzerland
1. What is the current business climate in your jurisdiction including major political, economic and/or legal activities on the horizon in your country that could have a big impact on businesses?
Switzerland has a liberal economic system, political stability, excellent infrastructure, a high standard of living, and a competitive tax system.
One of its principal challenges – outside the global challenges such as climate change and migration – is the development of the legal relationships with the EU. Switzerland and the EU have entered into a series of bilateral treaties since the 1990s that have allowed Switzerland to be part of the common market in many fields. Negotiations on the further development of such bilateral treaties have proven to be difficult.
2. From what countries do you see the most inbound investment? What about outbound?
Our neighboring countries (Germany, France, Italy, and Austria) are very important trade partners, but according to official statistics, inbound and outbound investments from several other European jurisdictions are just as important. Second, to Europe comes North America, then South America, Asia, Africa, and Australia.
3. In what industries/sectors are you seeing the most opportunity for foreign investment?
High precision mechanics, BioTech, MedTech, and FinTech. Switzerland has a strong base of world leaders in their respective fields, often run by entrepreneurs respectively family-owned. Many of those have successor issues or seek growth possibilities that present interesting opportunities for both strategic and financial investors.
4. What advantages and pitfalls should others know about doing business in your country?
Given the small geographical size of Switzerland, Swiss businesses are used to cross-border trading and often have English as a corporate language. High cultural diversity and multilingualism facilitate the interaction with foreign investors and business partners.
Switzerland is not a member of the EU. The bilateral treaties between Switzerland and the EU enable largely seamless participation in the common market of the EU but at times there are exceptions that can present a challenge.
5. What is one cultural fact or custom about your country that others should know when doing business there?
Be on time!
There is more to Switzerland than chocolate, cheese, mountains, watches, and banks: Excellent infrastructure; first-class education and health systems; and clusters of expertise in micro-mechanics, MedTech, life sciences, commodity trading, financial services, blockchain / DLT etc. in a very stable political and economic environment.
Last but not least: The Swiss banking secrecy – still a feature in many movies – no longer exists vis-à-vis foreign jurisdictions: automatic information exchange is the prevailing rule.
Our Firm
1. What distinguishes your firm from others in your market?
We are truly international. As a member of CMS and WLG, we are one of the very few firms in Switzerland that can almost immediately–i.e. within days, if not hours–put together an internationally diverse and agile team of experts from all disciplines for a cross-border transaction and offer truly integrated domestic and international legal advice under one roof. We have a proven track record and a reputation for excellent client service going back more than 80 years. CMS Switzerland combines local roots and business connections with the global outlook and reaches to serve its clients’ needs across Europe and beyond.2. What words describe the culture of your firm?
Collaborative: We are working in teams and involve more junior functions early on at all levels.
Pragmatic: We strive at providing clear and practical advice, knowing the issues in the industry or sector of our clients
Dedicated / Passionate: We know our clients' industry sectors and understand the issues in their field of business.
3. How does your firm participate in Corporate Social Responsibility (CSR) and/or Environmental, Social and Governance (ESG) initiatives?
CSR and ESG are at the forefront of our business. Not only do we advise our clients on all issues concerning ESG, we ourselves engage in a number of CSR and ESG initiatives.
In 2021 we accomplished the CMS Runners Without Borders Challenge. After ten weeks of running, cycling, walking, and hiking, our CMS employees all over the world covered more than 44,000 kilometers, crossing five continents and more than 40 countries. During our world trip, we raised money for our global charity partner MSF (Médecins sans Frontières / Doctors without borders). A Counsel from our Zurich office was the top fundraiser of this initiative.
For many years, we have supported a local foundation that assists disabled people by having our Christmas cards designed by their employees. Many of them are physically disabled due to a muscular dystrophy. With this contribution, we support their effort to take care of themselves and live independently.
4. Are there any new and exciting initiatives, practice areas or industry focuses in your firm?
Switzerland has very recently enacted new blockchain / Distributed Ledger Technologies (DLT) legislation that entails advanced regulatory solutions in key areas of the law, in particular corporate, insolvency, and financial markets law.
The new legislation creates legal certainty, removes obstacles to the use of blockchain applications, and reduces the risk of abuse. It facilitates, in particular, raising capital on the primary market through security token offerings, and shall enable issuers to trade their tokens on licensed exchanges (DLT trading facilities) on the secondary market. Combined with the new Swiss prospectus law and its clear-cut exceptions, Switzerland is well-positioned to become a hub for security tokens. The new DLT legislation furthermore clarifies the regulatory treatment of digital asset custodians and protects customers/investors by introducing a clear legal framework for segregating crypto-based assets from third-party custodians in case of bankruptcy proceedings.
We have increased our existing expertise and capacities in the field of blockchain / DLT by hiring a lateral partner specializing in this field.
Watch our video series in this regard.