Swiss Courts: No Return of Seized Assets to Sanctioned Individuals

Swiss courts have recently made a clear ruling: confiscated assets from individuals sanctioned by the country will not be returned. But why is this the case?

Confiscation Requirements

According to experts, confiscation of assets requires a criminal offense and a connection between the offense and the seized assets. Without a criminal offense, forfeiture is not possible. Moreover, the confiscation must be pronounced in accordance with procedural guarantees provided by the Swiss Constitution and the European Court of Human Rights.

International Sanctions

In the case of international sanctions, such as those imposed on Russia, the reason for forfeiture is not an offense but rather the violation of international law. This means that assets derived from legal acts cannot be confiscated, and there must be a connection between the criminal offense committed and the seized assets.

Swiss Parliament Proposes New Legislation

In response to the situation, the Swiss Parliament has proposed new legislation to create a legal basis for forfeiting frozen assets of Russian state organizations. The move is seen as a way to compensate Ukraine for damage caused by Russia’s violations of international law.

• Opponents argue that the proposal violates fundamental principles and norms of international law regarding state immunity.
• Switzerland has not yet decided whether or not to follow the EU position on freezing assets.

EU Solution: Setting Aside Revenues

The European Council has taken a different approach by deciding to set aside revenues from Russian Central Bank assets held in member states’ securities depositories. This move raises questions about how the money will be used, including options such as helping Ukraine’s reconstruction or providing military equipment.

Legal Uncertainties

While some argue that confiscating private assets without compensation is necessary, others believe it undermines the Federal Constitution and prevailing legal order. The right to property is a fundamental right, and any expropriation must respect the principle of legality and predictability of the law.

• Concerns also arise about state immunity from jurisdiction and execution under international law.
• The situation remains unclear as to what path Switzerland will take in regards to confiscating assets of sanctioned individuals and organizations.