Switzerland

Why Switzerland. Switzerland differs from every other jurisdiction examined in Part IV. It has no asset protection statute, no domestic law of trusts and no rule that refuses to recognize foreign judgments against trusts. Its place in asset protection planning rests on other foundations: a stable federal state with a long tradition of the rule of law; one of the world's leading banking and custody centers; a civil-law system that recognizes foreign trusts under the Hague Trust Convention and segregates trust assets from a trustee's personal estate; insurance legislation that protects life policies payable to a spouse or descendants from the policyholder's creditors; and procedural law that requires a foreign creditor to proceed through Swiss courts under Swiss rules. Switzerland is rarely the governing law of an American client's trust. It is often where the trust's assets are held, where its insurance policy is written or where its trustee or protector sits. This chapter examines Switzerland in those roles.

The jurisdiction. Switzerland is a federal republic of twenty-six cantons with a population of about nine million, outside the European Union but closely tied to it by treaty. Federal law governs private law, private international law, debt enforcement and bankruptcy, banking and insurance. The Federal Supreme Court in Lausanne is the highest court in civil and criminal matters. Switzerland is a member of the Financial Action Task Force and of the OECD, and is not on the European Union's lists of non-cooperative jurisdictions for tax purposes, having been removed from the watch list in October 2019 (see infra ¶ 2570.04).

Scope of the chapter. This chapter examines trusts in Swiss law (see infra ¶ 2510), the remedies available to creditors in Switzerland (see infra ¶ 2520), the recognition of American judgments (see infra ¶ 2530), Swiss life insurance (see infra ¶ 2540), the cases (see infra ¶ 2550), banking, secrecy and the United States (see infra ¶ 2560), foreign orders, discovery and legal assistance (see infra ¶ 2570) and the use of Switzerland in a plan (see infra ¶ 2580). It closes with Switzerland in the Threat Matrix (see infra ¶ 2590).

Sources. The provisions described here are drawn from the consolidated federal statutes published on Fedlex: the Federal Act on Private International Law ("PILA"), the Federal Act on Debt Enforcement and Bankruptcy ("SchKG"), the Civil Code ("ZGB"), the Insurance Contract Act ("VVG"), the Banking Act ("BankG") and the Criminal Code ("StGB"), in their versions current in 2026, and from decisions of the Federal Supreme Court. Swiss statutes are authoritative in German, French and Italian; English translations are unofficial. The planner should obtain the advice of Swiss counsel on any provision relied on.

The suitable client. Switzerland suits clients who need a stable, reputable place to hold liquid assets and life insurance outside the United States, beneath a trust governed by a protective jurisdiction's law. It suits clients who value private banking and investment management of high quality, who are willing to accept full tax reporting and who can satisfy a Swiss bank's due diligence. It suits less well a client who wants Switzerland itself to provide the protective law, since it has none, or a client who expects confidentiality from tax authorities, which it no longer provides (see infra ¶ 2560.01). It is also a natural choice for a client from Europe or the Middle East, for whom Swiss institutions are familiar and Swiss courts are a forum the client's creditors will find difficult (see infra ch. 50).