SWITZERLAND Trends and Developments Contributed by: Philippe M. Reich, Kaspar Projer, Samantha Salsench and Anna Zellweger, Baker McKenzie Switzerland AG
thereby avoiding (i) a Swiss nexus, or (ii) a nexus to the Russian Federation, or both. • The involvement of counterparties located in countries neighbouring the Russian Federation, in particular the “-stan” countries and Balkan coun - tries on the one hand, or in “friendly” countries such as China, Turkey or the UAE on the other hand, with strong ties to companies located in the Russian Federation (eg, they are partially owned by a Russian company, they have subsidiaries in Rus - sia, etc) and/or a strong business presence in the Russian Federation. • Transactions involving goods listed under the Annexes of the Ukraine Ordinance to be delivered to one of the aforementioned jurisdictions, as this may indicate that the goods are thereupon diverted to the Russian Federation. • Counterparties who, shortly before or after Febru - ary/March 2022, have restructured themselves, in order to avoid connections to the Russian Federa - tion (or to Switzerland or the EU/EEA). Further reference is made to the leaflet published by SECO on “ Red Flags zu den Sanktionen im Zusam- menhang mit der Situation in der Ukraine ”. Although this document does not specifically touch on circum - vention of Swiss sanctions, it provides helpful guid - ance on red flags in the context of sanctions, in par - ticular with regards to exports and SECO’s increased focus on these. In an effort to further combat the circumvention of sanctions, in its 14th sanctions package, the EU intro - duced an obligation for EU persons to “undertake their best efforts” to ensure that their owned or con - trolled subsidiaries in third countries do not engage in activities that “undermine” the EU Russia Sanctions (notably, to prevent the supply of restricted goods, technology, financing or services). In its announce - ment of the implementation of the 14th package on 16 October 2024, the Swiss Federal Council stated that the Swiss government chose not to introduce a similar obligation in the Ukraine Ordinance, instead relying on the existing legal framework that allows prosecution of companies circumventing sanctions via subsidiaries, especially when directed or instructed out of Switzer - land. The Swiss government further emphasised the effectiveness of the “Swiss” approach by citing ongo -
ing investigations by SECO into such circumvention attempts. Furthermore, in its 20th sanctions package introduced on 6 February 2026, the EU’s “anti-circumvention tool”; ie, the prohibition of the provision of specified items to specified third countries to prevent onward supplies to Russia, was activated for the first time and targeted at Kyrgyzstan. Under this measure, exports of machining centres for working metal and telecom - munication equipment to this Central Asian country are now prohibited to prevent re-exports to Russia. Switzerland has not, to date, introduced a comparable mechanism or similarly targeted measures. Given that Switzerland has also not yet fully implemented the EU’s 20th sanctions package (and is not expected to do so before mid-August 2026), it remains to be seen how this issue will be addressed in practice. Approach Towards Russia Exit Licences With the constantly expanding sanctions framework in Switzerland, in particular as far as sanctions against the Russian Federation are concerned, companies continue considering ceasing activities in the Rus - sian Federation and divesting from the Russian mar - ket entirely. Such exit transactions; eg, the sale of a Russian subsidiary to its Russian management (ie, management buy-out), usually include the transfer of restricted assets to a Russian party. Consequently, the transaction is subject to restrictions under the Ukraine Ordinance and thus requires a licence from SECO, in order to be completed. The Ukraine Ordinance includes two licensing grounds for exit purposes, Article 30a paragraph 1 for transfers, etc, of goods subject to product-related restrictions, and Article 30c paragraph 1 covering the provision, etc, of services and software subject to the so-called services and software ban (Article 28e of the Ukraine Ordinance). Article 30a paragraph 1 of the Ukraine Ordinance provides that SECO may grant authorisations until 31 December 2026 from various product-related restric - tions concerning the sale, supply, etc, of goods and technologies listed in the relevant annexes as well as the sale, licensing or other transfer of intellectual prop -
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