SWITZERLAND Law and Practice Contributed by: Urs Hoffmann-Nowotny, Marcel Jakob and Benno Strub, Schellenberg Wittmer Ltd
6.2 Jurisdiction Switzerland claims exclusive jurisdiction over insol - vency proceedings for companies based in Switzer - land. Insolvency proceedings opened abroad against Swiss companies are not recognised in Switzerland. For a company registered in Switzerland, the court at its registered office will always have exclusive juris - diction, and Swiss insolvency law will apply. Switzer - land will not open main insolvency proceedings over a company that has only its centre of main interests (COMI) in Switzerland. Furthermore, Swiss law does not permit an entire group of companies to be sub - ject to one comprehensive insolvency proceeding. Instead, each entity must be dealt with on a stan - dalone basis. However, when it comes to recognising insolvency proceedings opened over non-Swiss companies, Switzerland permits the recognition of insolvency pro - ceedings opened at a company’s COMI rather than its registered seat. 6.3 Applicable Law The PILA and any applicable international treaties determine the jurisdiction of Swiss courts and authori - ties, the applicable law, and the requirements for the recognition and enforcement of foreign judgments and the recognition of foreign bankruptcy and restructur - ing proceedings (see 6.1 Sources of International Insolvency Law ). Articles 166–175 of the PILA also contain some spe - cific provisions regarding the conduct of ancillary bankruptcy proceedings in Switzerland. Otherwise, ancillary bankruptcy proceedings are governed by the provisions on Swiss bankruptcy proceedings in the DEBA. These proceedings are handled by the bank - ruptcy office. 6.4 Recognition and Enforceability Recognition of Foreign Restructuring or Insolvency Procedures Swiss insolvency law is based on the principle of ter - ritoriality, meaning that Switzerland does not auto - matically recognise foreign insolvency decrees or their associated effects. In general, the recognition of a foreign insolvency decree requires a formal request
remaining proceeds will be distributed to the admit - ted creditors in accordance with their ranking. 5.4 The Position of Shareholders and Creditors in Liquidation Shareholders In a liquidation, shareholders have limited rights. Shareholders are not involved in any insolvent liq - uidation. Their main role in a solvent liquidation is to approve the final liquidation accounts and any accounts prepared during the liquidation process, as well as to resolve any interim distributions. Notably, shareholders may revoke a voluntary liquidation if asset distribution has not yet begun. Creditors In a solvent liquidation, creditors retain their rights and can assert their claims as before the liquidation. The liquidation cannot be completed until all liabilities have been settled, but amounts for liabilities that are not due yet or are disputed can be deposited. When bankruptcy proceedings are opened, credi - tors’ rights to enforce their claims against the debtor through debt collection or legal proceedings are sus - pended or restricted. However, there are exceptions for claims secured by mortgages. Depending on the proceeding and its status, ongoing debt collection and legal proceedings are either suspended or dis - continued. Suspended legal proceedings may resume later unless they have become moot (eg, due to the claim being admitted in the schedule of claims). 6. Cross-Border Issues in Insolvency 6.1 Sources of International Insolvency Law The Swiss legal provisions dealing with foreign insol - vency proceedings are contained in Chapter 11 of the PILA (Articles 166–175). Switzerland has not entered into any international treaties applicable in this regard, except for some very old and geographically limited treaties linking certain Swiss cantons to certain German federal states.
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