Sanctions 2025

SWITZERLAND Law and Practice Contributed by: Philippe Reich, Meera Rolaz, Kaspar Projer, Samantha Salsench and Anna Zellweger, Baker McKenzie Switzerland AG

In particular, in the scope of financial sanctions, vari - ous reporting obligations must be observed. One of the most important reporting duties can be found in Article 16 of the Ukraine Ordinance, whereby com - panies and individuals who hold or manage assets owned or controlled by designated individuals or enti - ties, or who have knowledge of the existence of such assets, are obliged to notify SECO immediately of all transactions which occurred in the two weeks prior to the listing of these persons, companies or organi - sations. Further details can be found in the section on “Trends in the financial sector” of the Switzerland Trends and Development chapter in this guide. Other reporting obligations (or notification obligations, as they are usually referred to) can for instance be found in Article 28e paragraph 6 of the Ukraine Ordi - nance – ie, the notification of ongoing services or soft - ware still being provided to Russian group companies held by Western parent companies. 3. Recent and Future Legal Developments 3.1 Significant Court Decisions or Legal Developments The last four years have been dominated by the imple - mentation of the EU sanctions packages against Rus - sia into the Swiss sanctions framework. However, in contrast to other jurisdictions, case law is still scarce. SECO’s decisions (usually in the form of penalty orders) are not published and there is still little case law from the Federal Administrative Court, which hears on appeals against SECO’s decisions. As far as the enforcement environment in Switzerland is concerned, reference is made to the section on “Swiss Enforcement Landscape” in the Switzerland Trends and Development chapter in this guide. The following judgments are noteworthy. Judgment of 7 November 2023 of the Federal Administrative Court (B-547/2023) The appeal concerned a company domiciled in Cyprus wholly owned by a company domiciled in Russia which is controlled by a EU and Swiss designated person.

The latter is the founder and financial supporter of a public school in Moscow. The financial resources to support the school were received via a charity fund. Since the designation, the payments to the charity fund had been stopped as a result of the freeze of the Swiss bank accounts, affecting two donation agree - ments of 2021 to the charity fund which could no longer be executed. The Judgment of the Federal Administrative Court offers an interpretation of the following questions: Coherence between the Ukraine Ordinance and the EU Russia Regulations The Federal Administrative Court emphasised that although the two regulations may differ in their word - ing, as they are subject to different legal requirements, the Ukraine Ordinance is based on a clear declaration by the Swiss government to implement the EU Rus - sia sanctions. In light of this, it is appropriate to refer to the EU legal basis and jurisprudence when inter - preting uncertainties in Switzerland, although limits of such an interpretation must be set where legislatively intended exceptions or amendments come into play (consideration 6.2.3). Definition of “ownership” and “control” according to Article 15 paragraph 1 of the Ukraine Ordinance The Federal Administrative Court noted that Swiss case law is based on the principles of control and domination under company law and of beneficial own - ership (considerations 4.2 et seq. with further refer - ences). The Court took the view that the designated person continued having a de facto connection with the school for the following reasons: • the designated person continued having a seat on the school board and the charity fund board, which is authorised to decide on all areas of the fund’s activities, including on the use of the funds; • various members of the school board and the director had already held their respective offices at a time when the designated person was still acting in his capacity as founder of the school; • the school was founded by the designated person and largely financed by him;

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