SWITZERLAND Trends and Developments Contributed by: Marco Toni and Lara Pafumi, Loyens & Loeff
are sufficient, and that it is not aware of any past takeovers by foreign investors that would have jeopardised or threatened public order or secu- rity in Switzerland. Nevertheless, in September 2024, the Swiss National Council voted in favour of the new Investment Screening Act following the propos- als of its Committee for Economic Affairs and Taxation, which even extended the original draft. Specifically, the Swiss National Council decided that investment control should also apply to non- state investors and that – apart from public order and security – the supply of essential goods and services should explicitly be protected. Furthermore, according to the Swiss National Council, the Swiss Federal Council should be given greater leeway to make other companies subject to authorisation if necessary. The draft Investment Screening Act is currently being discussed by the Council of States and is not expected to come into force until 2026. Partial revision of the Swiss Cartel Act In May 2023, the Swiss Federal Council adopted a dispatch to partially revise the Swiss Cartel Act, aiming to implement three parliamentary initiatives. The main focus of this revision is to modernise Swiss merger control by replacing the current qualified market dominance test with the Significant Impediment to Effective Compe- tition (SIEC) test, aligning it with international standards. The SIEC test would lower the threshold for regulatory intervention, making it easier for authorities to step in. This change is expected to make Swiss merger control procedures more time-consuming and burdensome wing to the increased role of economic evidence. Larger transactions in the technology sector could be
particularly affected. However, this revision still requires approval from the Swiss Parliament. EU Artificial Intelligence Act With the EU Artificial Intelligence Act (the “EU AI Act”), the first-ever legal framework on AI that aims to provide AI developers, deployers and users with clear requirements and obligations regarding specific uses of AI came into force on 1 August 2024. The regulations will be phased in to give companies time to adapt their AI sys- tems to different risk profiles, where necessary. Like the GDPR, the EU AI Act has extraterritorial reach and will not only be applicable to a Swiss company that makes an AI system available in the EU market but will also apply if the output generated by the AI system of a Swiss company is used in the EU. Currently, Swiss law does not specifically regu- late AI systems. However, in November 2023, the Swiss Federal Council has instructed the Federal Department of the Environment, Trans- port, Energy and Communications to prepare a report on the possible regulatory approaches to AI systems for Switzerland that are particularly compatible with the EU AI Act and the Council of Europe’s AI Convention, which should form the basis for a concrete mandate for an AI regula- tory proposal in 2025. As a result, it is expected that Switzerland will soon regulate the use and application of AI. Swiss innovation fund In June 2022, the Swiss Federal Council made a directional decision to establish a Swiss innova- tion fund. This fund was intended to improve the financing of start-ups during their growth phase, especially in the area of digitalisation. However, instead of taking further steps towards realisa- tion, the Federal Council decided not to pursue
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