SWITZERLAND Trends and Developments Contributed by: Pascal Hachem, Nadja Jaisli Kull and Aurélie Conrad Hari, Bär & Karrer AG
buyers or whether sellers may ration goods among their customers. Economic sanctions and arbitration On 4 March 2022, Switzerland implemented the first package of economic sanctions against Russia. With minor deviations, these were the economic sanctions that the European Union had rolled out in the wake of Russia’s invasion of Ukraine. Since then, Switzerland has closely aligned its sanctions regime with that of the European Union and implemented additional sanctions packages. Today, sanctions legislation in Switzerland and the European Union is by and large identical. Rendering legal services to the government of the Russian Federation or to legal entities in the Russian Federation is prohibited under article 28e(1)(a) of the Ukraine Ordinance. There is an exception to this pro - hibition in article 28e(10)(a) of the Ukraine Ordinance, provided that the legal services are necessary to preserve the right to legal defence in court proceed - ings and the right to a valid appeal. There is a further exception in article 28e(10)(b) of the Ukraine Ordi - nance, provided that the legal services are necessary to ensure access to court proceedings, administrative proceedings and arbitral proceedings in Switzerland, a member state of the European Economic Area or the United Kingdom or for the recognition and enforce - ment of a court judgment or an arbitration award ren - dered in Switzerland, a member state of the European Economic Area or the United Kingdom. Under Russian law, since 2020 Russian courts have been able to ignore arbitration and choice of court agreements, irrespective of the law applicable to such agreements, on the grounds that Russian parties could not expect fair proceedings abroad. As part of its counter-measures against foreign sanctions, Rus - sia gave its courts exclusive jurisdiction over disputes concerning sanctioned Russian entities and disputes concerning foreign sanctions in Article 248 of the Arbitrazh Procedural Code of the Russian Federation (APC). The same provision also allows Russian courts to issue anti-suit injunctions against foreign proceed - ings under threat of criminal sanctions. Initially, article 248 APC was used by Russian courts to protect Russian entities subject to foreign sanc -
tions. However, Russian courts now use this provision whenever they perceive a restrictive measure against or disadvantage to a Russian legal entity. Counterpar - ties to Russian legal entities at first attempted to blunt the Russian courts’ use of article 248 APC by request - ing anti-suit injunctions abroad to prevent Russian legal entities from going to Russian courts in the first place. Typically, they order foreign companies not to apply for anti-suit injunctions abroad under threat of large fines, which directly exposes assets located in Russia to immediate enforcement and could trigger proceedings for recognition and enforcement of such Russian court decisions abroad. On 12 February 2025 Switzerland implemented the EU’s response of November 2024 in article 29d of the Ukraine Ordinance. Since then, it is explicit in Swiss legislation that any orders, decisions, judgements or other court measures on the basis of or in connec - tion with article 248 APC or comparable Russian legal provisions are not recognised, carried out or enforced (article 29d(1) Ukraine Ordinance). The provision also makes clear that any requests for legal assistance in connection with any alleged violation of such orders, decisions, judgements or other court measures will not be granted (article 29d(2) Ukraine Ordinance). Finally, any penalties or other sanctions issued under the Russian Criminal Code for violations of orders, decisions, judgements or other court measures based on article 248 APC will not be recognised and will not be executed in Switzerland (article 29d(3) Ukraine Ordinance). Outlook Switzerland’s outlook in arbitration is positive. The quality of services offered by both its law firms as well as institutions is high, while Swiss universities provide a steady flow of strong talent. Switzerland’s legislative framework, both in terms of substantive law as well as arbitration law, is stable and proven in practice. Swiss contract law is apt to address the current and future challenges in international commerce. Switzer - land is arbitration friendly and reliable in respecting the finality of awards. The Swiss Federal Supreme Court remains solid in its position in deferring to arbi - tration and arbitral awards, while not compromising on protecting procedural safeguards and good faith conduct.
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