Commentaries

Artificial intelligence (AI) is gradually transforming the landscape of businesses and financial institutions. To take full advantage of these technologies while managing the associated risks, it is essential to establish robust AI governance. This ensures that AI systems are aligned with the company's values, objectives and regulatory standards, while ensuring effective risk management. According to a FINMA survey, the use of AI in Swiss financial institutions rose from 53% in 2023 to 75% in 2025, with a projection of 90%[...]

Bank accounts held by a lawyer may contain information protected by professional secrecy, which must not be disclosed to a foreign state in the context of administrative assistance in tax matters. This must be assumed to be the case for client accounts opened using Form R, but it is also possible that other accounts held by the lawyer may contain protected information. These are the principles laid down by the Federal Court in a ruling 2C_116/2023 of 2 May 2025[...]

On 15 May 2025, the Federal Court published a ruling of principle (TF 5A_440/2024 of 31 March 2025) clarifying the following question: Are loans granted by related parties to a company without an explicit subordination agreement subordinated in the event of the company's bankruptcy? The Federal Supreme Court confirmed that claims arising from such loans must, in principle, be treated as ordinary third-class claims in the event of bankruptcy (Art. 219 para. 4 LP). However, only in exceptional cases characterised[...]

The discretion surrounding the publication of the 2024 Annual Report, coupled with the removal of reports prior to 2015 from the MROS website (available on the Swiss National Library website), raises questions at a time when the practical guidelines published by MROS are regularly cited in ongoing proceedings. On the other hand, the typologies are now the subject of an interesting report, which also highlights good practices by financial intermediaries (FIs). In addition to its intelligence-gathering task (processing reports), the[...]

When several clients are harmed in the same case of fraud, an important question arises in insurance: is this a single claim or several claims? In its ruling 4A_626/2024 of 21 March 2025, the Federal Court answered in the affirmative. It upheld an arbitration award that denied a bank any insurance coverage on the grounds that each claim by an aggrieved customer had to be considered a separate claim, subject in particular to a separate deductible. The ruling highlights the[...]

In its judgment ACJC/141/2025 of 28 January 2025, the Geneva Court of Justice ruled that a bank's communication of its new pricing conditions in accordance with its general terms and conditions, which provided for tacit acceptance, validly derogated from special conditions agreed with the customer on fees, in the absence of timely opposition by the latter. An appeal against this ruling has been lodged with the Federal Court. At the beginning of 2019, a client opened an account with a[...]

In its press release of 21 March 2025, the Federal Council reported on the results of the consultation procedure on the partial revision of the regulations on non-financial reporting and due diligence obligations for companies, which ended in October 2024. The Federal Council reaffirms its commitment to bringing Swiss law into line with international standards. However, in view of recent legislative developments in the EU, Swiss companies will have to wait before they know what will happen to the draft[...]

Was FINMA, and subsequently the Federal Administrative Court, right to refuse dividend payments by an insurance company in connection with the approval of a liquidation plan and a modified business plan on the grounds that the company had failed to comply with its obligation to cooperate with the supervisory authority? This is the question that the Federal Supreme Court had to answer in a ruling handed down on 18 February (2C_94/2024). The case in question concerns an insurance company that[...]

In a recent judgement, the Federal Court rejected a bank's appeal against a judgement of the Vaud Cantonal Court refusing to order the seizure of real estate belonging to the debtor's ex-wife (judgement 5A_754/2024 of 18 February 2025). Although the judgement in question mainly concerns matters of enforcement, in particular in relation to the degree of likelihood that the creditor must achieve in order to obtain a sequestration, this case is a telling example of the difficulties that a creditor[...]

There is debate about the extent to which the client's knowledge and experience should be gathered as part of the suitability test. The solution proposed by Art. 12 para. 2 FinSA is probably not satisfactory for the investment advisory service. For the management service, the interpretation of this provision proposed by FINMA in its Circular 2025/2 on the rules of conduct according to FinSA and FinSO has been fairly criticized and, according to some, deviates from the will of Parliament.[...]

The European AI Regulation (AI Act), designed in particular as legislation governing the safety of AI systems (AIS), imposes requirements that any high-risk AIS must meet before it is placed on the market or put into service in the European Union, throughout its life cycle. In the banking and financial sector, the AI Act considers credit scoring AIS to be high risk. The requirements are set out in Articles 8 to 15 AI Act and relate in particular to the[...]

The Geneva Court of Justice, in its ruling ACJC/1653/2024 of 19 December 2024, ruled that a clause waiving retrocessions indicating percentage ranges of the ‘volume invested on an annual basis’ by product category is valid within the framework of a management mandate. The Court of Justice begins its reasoning by recalling the principle that the agent must not be impoverished or enriched by the mandate apart from his agreed fees. Referring to the judgment 4A_266/2010 (commented in Fischer, cdbf.ch/773), it[...]

The Federal Supreme Court decision 7B_1158/2024 of 18 February 2025 (not intended for publication) does not introduce any major new developments but constitutes an additional landmark in the maze of sealing procedures, in particular in the case of parallel procedures and the transmission of information between authorities. Following a report from FINMA, the FDF opened administrative criminal proceedings in March 2021 for breach of the duty of disclosure committed within a bank. In this context, the administrative authority requested various[...]

In judgment 7B_691/2024 and 7B_796/2024 of 7 February 2025, handed down by a panel of five judges but not intended for publication, the Federal Supreme Court (‘FSC’) confirms its recent case law on the application of seals under the new law (art. 264 para. 1 let. d) cum 248(1) 1st sentence CPP, cf. in particular Villard, cdbf.ch/1368). The Office of the Attorney General of Switzerland (OAG) is conducting criminal proceedings against two defendants. In this context, the OAG is conducting[...]

In a judgement published on 31 May 2024, the Federal Court had already confirmed that the fraudulent obtaining of a ‘COVID-19’ loan constituted fraud (ATF 150 IV 169, commented in Dupuis, cdbf.ch/1353). On the other hand, its case law was fluctuating with regard to the commission of the offence of forgery in relation to the presentation of the false credit application form to the lending bank. The judgement 6B_95/2024 of 6 February 2025, intended for publication, provided the answer of[...]

In a judgement 2C_219/2022 of 30 January 2025, intended for publication, the Federal Supreme Court (FSC) rejected a request for administrative assistance in tax matters submitted by Russia. The proceedings before the FSC had been suspended since 2022. Russia had sent a request for assistance to the Federal Tax Administration (FTA) in 2018 in order to identify the economic beneficiaries of dividends paid to Cypriot companies on three bank accounts opened in Switzerland and, if necessary, to reassess the amount[...]

The credit scoring company must explain to the person concerned the procedure and principles applied in practice to establish his or her solvency profile. Furthermore, the company's business secrecy does not preclude the communication of information to the authority or the court, which must weigh up the interests involved (judgment of the CJEU of 27 February 2025 in case C-203/22). A mobile phone operator refused to allow an Austrian national (CK) to conclude a mobile phone contract, which would have[...]

On February 19, 2025, the Federal Council sent the message to Parliament concerning the project to extend the automatic international exchange of information in tax matters (AIE) to crypto-assets (the Message) by adopting a framework for the declaration of crypto-assets (CDA). In addition to the CDC, the Message proposes additions and amendments to the law (P-LEAR) and the ordinance (P-OEAR) on the automatic exchange of information. The new rules are expected to come into force on January 1, 2026, for[...]

A customer who receives notice of a fraudulent direct debit commits a fault if they do not dispute it. This fault interrupts the causal link between the bank's serious fault and the damage (4A_610/2023). A Liechtenstein foundation manages the assets of a prince. Its headquarters are at a law firm in Liechtenstein. A lawyer from this firm is a member of the foundation board with joint signature with the prince. The foundation opened an account with a bank in Geneva.[...]

Following on from the EU's General Data Protection Regulation (GDPR), the European Regulation on Intelligence artificial (AI Act) provides for a broad territorial scope, covering not only companies incorporated within the EU, but also some located in third countries such as Switzerland. Swiss financial intermediaries may therefore be affected by the AI Act, the extraterritorial dimension of which is presented in this commentary. A. Criteria for determining the territorial scope of the AI Act We will discuss here the two[...]

A borrower who uses the loaned funds for a purpose other than that specified in the contract may exceptionally be found guilty of breach of trust (Art. 138 para. 1 of the Swiss Criminal Code). For this to happen, the purpose for which the assets were lent must be clearly defined in the contract, which was not the case in ruling 6B_240/2024 of 9 January 2025. On the basis of a loan agreement , a company lends USD 300,000 to[...]

In a ruling intended for publication, the Swiss Federal Supreme Court, against the advice of the Federal Tax Administration, exempts a holding company from stamp duty (i) in the case of an intra-group transfer of shareholdings that do not meet the restructuring conditions set out in the LIFD and (ii) following the granting of shareholdings to employees free of charge (9C_168/2023, 9C_176/2023 of 25 November 2024). The case concerns a holding company carrying out two transactions which the Federal Tax[...]

In judgment PS240181 of 14 November 2024, the ZurichObergericht ruled that art. 44 of the Swiss Criminal Code applies by analogy to asset freezing measures taken under the Embargo Act and its implementing ordinances, despite the absence of any reference to the Embargo Act in art. 44 of the Swiss Criminal Code. It follows that realisation under the LP is not possible as long as the assets are frozen. On 6 June 2023, a creditor with an enforceable judgment from[...]

Following a merger, the acquiring company may be condemned by the SIX for a violation committed by the transferring company. In addition, the CEO's conviction must be announced, even if it concerns acts committed within another company (award (final) by the SIX Court of Arbitration of August 26, 2024). A managing director and CEO of a company listed on the SIX is convicted of professional fraud and disloyal management within another company. The listed company merges with another company (acquiring[...]

Banks and financial institutions are increasingly integrating artificial intelligence (AI) into their internal services and processes (see e.g. Jotterand, cdbf.ch/1377). In particular, this use can present operational, legal and reputational risks (see e.g. Levis, cdbf.ch/1380), as well as a growing dependence on third-party suppliers, especially for AI models and cloud services. Added to this is the difficulty of assigning clear responsibilities in the event of errors in the AI system or model. The use of AI by banks and financial[...]

The Swiss Federal Supreme Court recently handed down a new ruling on the subject of fraudulent bank orders, in which it annulled a cantonal decision on the grounds that it did not address all the issues raised by the plaintiff (ruling 4A_135/2023 of October 16, 2024). Although this ruling mainly concerns questions of civil procedure, it nevertheless serves as a useful reminder of the scope of the examination that the court must undertake in the presence of fraudulent orders. In[...]

The European Regulation on Artificial Intelligence (AI Act) adopts an approach based on the risks that an artificial intelligence system (AIS, cf. Caballero Cuevas, cdbf.ch/1382) may pose to the health, safety and fundamental rights of individuals. AIS are divided into four categories, respectively AIS presenting an unacceptable risk, AIS presenting a high risk, AIS presenting a limited risk and AIS presenting a minimal risk. This commentary focuses on the first three categories of AIS. A. AIS presenting an unacceptable risk[...]

In our last commentary on a Federal Court ruling on sealing (7B_313/2024, intended for publication), we stated that ‘banking secrecy no longer constitutes a ground for sealing where it is invoked by a third party, i.e. a person not involved in the criminal proceedings’ (Villard, cdbf.ch/1383). Following the publication of judgment 7B_976/2024, which is commented on here, the second part of the statement should be deleted: banking secrecy no longer constitutes a ground for sealing. Ruling 7B_976/2024 was not concerned[...]

A lawyer specializing in banking law, who agrees with his client that he will receive banking correspondence on his behalf, should be able to detect the unusual nature of fraudulent orders. If he fails to do so, he may incur contractual liability and must compensate the client (4A_269/2024). A Geneva lawyer specializing in banking law sets up and manages a Panamanian company for a French businessman. The company opens a bank account in Geneva. The contract stipulates that correspondence is[...]

The development of artificial intelligence (AI) has become an issue of global importance. AI is now used not only in industry, but also in the service and entertainment sectors. Robots can help lawyers, doctors, bankers, brokers, nurses, farmers, social workers or even artists. The increased use of AI is having a positive effect, as robots can now replace difficult, repetitive or even dangerous activities (such as cleaning up polluted sites) and boost productivity. However, its impact on the future of[...]