SWITZERLAND Law and Practice Contributed by: Annemarie Lagger and Amina Chammah, Walder Wyss Ltd
2.13 The Impact of Regulatory Compliance on Product Liability Claims A producer’s failure to meet the regulatory requirements is considered a breach of the prod - uct user’s justified safety expectations and can be decisive in determining of the defectiveness of the product. Swiss courts, however, have repeatedly found that adherence to regulatory requirements is the minimum standard only when determining the justified safety expecta - tions. The producer must assess, in each indi - vidual case, whether its product meets the user’s safety expectations and may not rely on adher - ence to regulatory requirements or the conform - ity assessments of regulatory bodies. 2.14 Rules for Payment of Costs in Product Liability Claims With the enactment of partial revision of the Swiss Civil Procedure Code on 1 January 2025, the court or the conciliation authority may demand that the claiming party makes an advance pay - ment not exceeding one half of the expected court costs to initiate court proceedings. Prior to the revision, the advance payment could amount to the total of the expected court costs. For certain proceedings, eg, summary proceed - ings, advance payment of the total estimated court costs may be requested. The payment of the advance is a procedural requirement for bringing an action, meaning that if no payment is made the case will be declared inadmissible. This can be a significant hurdle for claiming par - ties in general, and in particular in product lia - bility cases involving consumers, given that the amounts to be advanced are calculated based on the amount in dispute and are typically rela - tively large. It remains to be seen whether halv - ing the potential court costs resulting from the revision will actually facilitate access to justice.
The claiming party may be reimbursed for the advance payment if it wins the case as, in Switzerland, the “loser pays” principle applies. Accordingly, the costs follow the event, which means that the losing party must bear the court costs and, on top of that, must compensate the successful party for its legal costs. Court costs are determined and allocated by the court ex offi - cio, while party costs are awarded upon request. Advance payments paid by the successful party will be directly refunded from the court. The compensation for legal costs is determined in accordance with a tariff that is primarily based on the amount in dispute. The tariffs vary between cantons, but in the majority of cases the compensation granted does not cover the real legal costs incurred by a party; depending on the amount at stake, the amount payable as compensation for legal fees can be higher or lower than the actual costs incurred. If no party succeeds entirely, the costs are allo - cated in accordance with the outcome of the case and unnecessary costs are charged to the party that caused them, independently of wheth - er it was the losing party. 2.15 Available Funding in Product Liability Claims Third-Party Funding Third-party funding is permitted in Switzerland and does exist, although it is not very common. In principle, there are no restrictions on third- party funding, as long as the funded party is still in control of the claim. If the funded party is rep - resented by legal counsel, it is important to avoid any set-up that might impair the counsel’s ability to act independently and to pursue only their cli - ent’s interests. Otherwise, such a set-up might interfere with the counsel’s obligations pursuant to the rules of professional conduct.
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