On 1 January 2019, the revised Section of the Swiss Private International Law Act (PILA) regarding cross-border insolvencies entered into force. The revision became necessary as the previous regulation was criticised in particular for its protectionist elements, which also were a recurring topic in discussions with foreign colleagues and insolvency practitioners. Particularly compared to other European countries, Switzerland had apparent modernisation potential.

Introduction

The Swiss Debt Enforcement and Bankruptcy Act (DEBA) allows the initiation of debt enforcement proceedings before a court becomes involved. A creditor can request the competent debt enforcement office (normally at the domicile of the debtor) to issue a payment order to the debtor. The office serves that payment order without verifying the existence and enforceability of the purported claim; however, the debtor may declare its objection, within 10 days, to the debt enforcement office.

Introduction
Measures against abusive insolvencies

On October 14 2015 the Federal Council published a revision project for the Private International Law Act regarding the recognition and coordination of foreign bankruptcy proceedings in Switzerland.

Current situation

A foreign insolvency decree can be recognised in Switzerland, at request of the foreign liquidator or a creditor, only if:

Introduction

Introduction

Due to the prevalence of the territoriality principle in Swiss bankruptcy law, a foreign bankruptcy trustee's powers to act in Switzerland are limited. In general, a foreign trustee is not allowed to collect assets located in Switzerland, even if it is competent to act under the applicable foreign law. A foreign bankruptcy trustee may, in principle, only apply for recognition of the foreign bankruptcy decree and request protective measures.

Introduction
Facts
Supreme Court decision
Comment

Introduction

The standard debt enforcement process

The Swiss Federal Assembly has passed the revised Swiss restructuring law in the closing vote of 21 June 2013. The referendum deadline has expired uncalled on 10 October 2013. The primary aim of the partial revision of the Swiss Debt Enforcement and Bankruptcy Act is to facilitate restructurings.