Switzerland, Walder Wyss updates

Corporate Tax

Contributed by Walder Wyss
Taxation of digital economy: Swiss response to recent OECD statement
  • Switzerland
  • 28 February 2020

The Organisation for Economic Cooperation and Development recently released a statement update on a new international framework to allocate part of the profits of multinational enterprises with a substantial digital business footprint in countries in which they have a large user base, but no physical presence. Switzerland has stated that it will maintain its support for the development of a multilateral solution for taxing the digital economy to avoid unilateral actions that jeopardise growth and innovation.

Fundamental changes to Swiss withholding tax on interest payments
  • Switzerland
  • 09 August 2019

The Federal Council recently announced its intentions to resume the temporarily suspended Swiss withholding tax reform and set out the general framework to introduce a paying agent tax system with regard to interest payments. However, as the Federal Council's communication did not contain any details, it remains to be seen how the reform will be set out in the draft bill expected in Autumn 2019 and how it will affect paying agents and investors.

Switzerland adopts new corporate tax reform
  • Switzerland
  • 24 May 2019

Swiss voters recently approved a new corporate tax reform, which will set the basis for new rules on Swiss corporate taxation and secure and enhance Switzerland's overall attractiveness as a business location. The reform includes a patent box, an R&D super deduction and a notional interest deduction for high-tax cantons. There are also substantial non-tax (revenue-raising) measures and new provisions on social security contributions.

Welcome relaxation of Swiss withholding tax rules on foreign bonds guaranteed by Swiss parent company
  • Switzerland
  • 22 February 2019

The Swiss Federal Tax Administration recently relaxed its practice under which bonds that are issued by foreign resident issuers, but guaranteed by their Swiss resident parent company, are requalified as domestic issuances which trigger Swiss withholding tax on interest payments. The revised rules significantly increase the permissible use of proceeds in Switzerland.

Intra-group debt financing: updated safe haven rates and thin capitalisation rules
  • Switzerland
  • 15 February 2019

The Swiss Federal Tax Administration recently published the 2019 safe haven interest rates to be used on intra-group loans. Against this backdrop, this article provides an overview of the relevant Swiss tax rules associated with determining whether intra-group financing constitutes equity or debt for tax purposes and the consequences of each characterisation.


Healthcare & Life Sciences

Contributed by Walder Wyss
Swiss health study commenced
  • Switzerland
  • 25 March 2020

The Lausanne University Centre for General Medicine and Public Health, in close cooperation with the Swiss Biobanking Platform, recently commenced the pilot phase of the so-called 'Swiss health study', which aims to determine which chemicals accumulate in the human body. The pilot phase is supported by the Federal Office of Public Health.

Indirect counterproposal to nursing care initiative
  • Switzerland
  • 18 March 2020

The popular nursing care initiative 'For Strong Nursing Care' is calling for more nursing staff and quality safeguarding in nursing care. The Swiss parliamentary Commission for Social Security and Health recently presented an indirect counterproposal to this popular initiative. The counterproposal adopts a number of the initiative's important demands and aims to counter the nursing staff shortage and increase nursing staff skills with an educational campaign.

Court annuls FOPH order limiting medicinal product price increase
  • Switzerland
  • 04 December 2019

The Federal Administrative Court recently annulled a Federal Office of Public Health (FOPH) order that had limited the price increase of a medicinal product on the list of specialities to two years. The FOPH had permitted a temporary (ie, two-year) price increase of 20%; however, the Federal Administrative Court upheld the manufacturer's argument that such time limits may be imposed only for comprehensible and appropriate reasons, which the FOPH could not convincingly provide.

Federal Supreme Court upholds breast implant decision
  • Switzerland
  • 30 October 2019

The Federal Supreme Court recently dismissed an appeal against a Zurich Social Insurance Court decision concerning the replacement of an appellant's breast implant under compulsory health insurance. According to the Federal Supreme Court, a gynaecologist's reasoning that the appellant's pain was most likely caused by the implant was incomprehensible and therefore the Zurich Social Insurance Court's decision was not arbitrary.

Federal Council aims to combat human organ trafficking more effectively
  • Switzerland
  • 23 October 2019

The Federal Council recently submitted to Parliament a dispatch approving the Council of Europe Convention against Trafficking in Human Organs. The Federal Council supports the convention, which aims to harmonise criminal provisions internationally. In particular, the convention provides for the prosecution of all human organ trafficking, regardless of where it takes place.


Securitisation & Structured Finance

Contributed by Walder Wyss
Legal considerations of assignment of receivables under Swiss international private law
  • Switzerland
  • 03 March 2020

From a Swiss legal perspective, in order to ascertain the enforceability of an assignment against a debtor of receivables, the assignment of a receivable must be subject to the law governing the receivables. Further, in order to safeguard the validity of a Swiss law-governed assignment of receivables under a formalities perspective, care must be taken that a wet-ink original of each declaration of assignment is made available to the assignee.

Key considerations regarding asset classes and assignability of receivables
  • Switzerland
  • 22 October 2019

In recent years, the number of publicly placed and listed securitisation transactions in the car leasing and credit card sectors has increased significantly. The driving force behind this development is economic rather than legislative, as Swiss law places no specific restrictions on asset classes eligible for securitisation. However, compliance with certain Swiss legal concepts is crucial when setting up a securitisation transaction involving Swiss law-governed receivables.

Securitisation transactions: avoidance actions under DEBA
  • Switzerland
  • 02 July 2019

A key consideration for any investor or rating agency is the insolvency analysis of a securitisation transaction. In this context, the insolvency remoteness of the special purpose vehicle is a decisive element. Another important consideration are the circumstances under which a securitisation transaction may be set aside in the context of an insolvency proceeding. This article focuses on the avoidance actions set out in the federal Debt Enforcement and Bankruptcy Act.

Legal considerations regarding SPVs
  • Switzerland
  • 26 March 2019

Switzerland has no specific securitisation legislation. Therefore, securitisation transactions are subject to the general legal framework that applies to all other financial transactions with respect to, among others, both corporate law and regulatory matters. This article provides a short overview of certain company-related aspects to consider when setting up a special purpose vehicle structure for a securitisation transaction in Switzerland.

Regulatory aspects of securitisation in Switzerland
  • Switzerland
  • 22 January 2019

The Swiss securitisation market is highly active and attractive for both issuers and investors. However, Switzerland has not enacted any specific securitisation legislation. Therefore, securitisation transactions are subject to the general legal framework that applies to any other type of financial transaction. This article provides a short overview of several regulatory aspects to consider when setting up a securitisation transaction in Switzerland.


Tech, Data, Telecoms & Media

Contributed by Walder Wyss
IT outsourcing by banks and insurers facilitated by revised regulations
  • Switzerland
  • 10 January 2020

On 1 January 2020 the Swiss Financial Market Supervisory Authority implemented various revised rules primarily targeting small banks (the so-called 'small banks regime'). Among other aspects, this will result in a relaxation of IT outsourcing requirements for financial institutions. The amendments are positive and a step in the right direction, as they will allow financial institutions to enjoy more leeway to benefit from IT outsourcing services.

Federal Council considers introduction of cyber incident reporting duty
  • Switzerland
  • 20 December 2019

While many countries have introduced far-reaching obligations to report cyber incidents, Switzerland has not yet followed this lead. However, the Federal Council recently adopted a report which considers key issues with regard to the introduction of a general reporting obligation for operators of critical infrastructure. The report also discusses possible implementation models.

Federal Council adopts dispatch to improve legal framework for blockchain and DLT
  • Switzerland
  • 13 December 2019

The Federal Council recently adopted a dispatch message to improve the legal framework governing distributed ledger technologies (DLT) in Switzerland. The Federal Council's objective is to increase legal certainty, remove obstacles to DLT-based applications and limit the risk of abuse. The Swiss parliament will examine the dispatch message in early 2020.

Federal Council offers financial assistance to online media
  • Switzerland
  • 27 September 2019

In view of the media industry's ostensibly democratic and political role, the Federal Council has decided to adopt effective and feasible support measures. These measures will be implemented by adapting existing laws and incorporating online media into the scope of the Federal Act on Radio and Television. However, the plan to create a new Electronic Media Act has been abandoned.

Review of private WhatsApp messages on work mobile phone deemed unlawful
  • Switzerland
  • 19 July 2019

The Supreme Court of the Canton of Zurich recently clarified that employers must clearly regulate the private use of work communication devices, as well as any related control mechanisms. Further, data processing such as verifying WhatsApp chat messages – even if the information is stored on a work mobile phone – must be done in accordance with the more restrictive Article 328b of the Code of Obligations.


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