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Swiss Authorities Crack Down on Sanctions Violations with Imprisonment for Up to Five Years

The Swiss Federal Office for Customs and Trade (SECO) has been stepping up its efforts to enforce financial sanctions imposed by the country, with a particular focus on breaches related to the situation in Ukraine. The move comes as Switzerland’s authorities are cracking down on companies and individuals who violate these sanctions.

Enforcement Efforts

According to sources, SECO is taking a more aggressive approach in investigating alleged violations of financial sanctions, which can lead to imprisonment for up to five years for those found guilty. In addition, mere negligence breaches of Swiss sanctions can result in fines of up to 100,000 Swiss francs.

International Cooperation

Swiss authorities have been working closely with their foreign counterparts to enforce financial sanctions. However, cooperation is only possible if:

  • It is necessary for implementing the imposed sanctions regime.
  • Foreign authorities are bound by official secrecy or a corresponding duty of secrecy.
  • They guarantee the prevention of industrial espionage within the scope of their activities.

Blocking Legislation

Switzerland does not have restrictions in place that prohibit adherence to other jurisdictions’ sanctions or embargoes. However, applicable blocking statutes, secrecy, and data protection regulations may restrict compliance with foreign reporting obligations relating to sanctions imposed by other countries or supranational organizations.

Investigations

The Swiss authorities initiate investigations based on:

  • Their own observations.
  • Criminal or other complaints filed by victims or third parties.
  • Reports by whistleblowers.
  • Media reports.
  • Reports from other authorities, including foreign authorities.

The criminal authorities and the Swiss Financial Market Supervisory Authority are required to report all offenses they become aware of in their official capacity.

Data Protection

Switzerland has a data protection regime based on the Federal Data Protection Act (FDPA), which was revised in 2023. The FDPA requires that personal data only be processed:

  • Lawfully.
  • In good faith.
  • Transparently.

Any data processing that does not comply with these principles constitutes a breach of the data subject’s personal rights.

The Federal Data Protection and Information Commissioner (FDPIC) is responsible for enforcing the data protection regime. It has been granted more extensive enforcement powers, including:

  • Conducting investigations ex officio or on receipt of a complaint.
  • Collecting evidence.
  • Issuing orders.

Internal Investigations

Companies in Switzerland must ensure that internal investigations are set up in compliance with data protection laws. The most important data protection issue in connection with internal investigations is the provision that personal data may only be transferred to countries with inadequate data protection regulations if:

  • Justified by a statutory provision of Swiss law.
  • Consent of the data subject.
  • Disclosure necessary to safeguard an overriding public interest.

Interception of Employees’ Communications

Swiss labour laws and data protection laws regulate the interception of employees’ communications. Any monitoring that has not been announced in advance is permissible only in exceptional cases, such as:

  • Investigation of suspected criminal activities.
  • Serious violation of internal rules and risk of collusion.

In addition, there are several criminal provisions that sanction the breach of privacy.

Dawn Raids and Search Warrants

Search warrants and dawn raids are legal tools used by Swiss authorities to conduct investigations. Companies and individuals must comply with these measures, which can be authorized by a court or a prosecutor’s office. The use of search warrants and dawn raids is subject to strict rules and oversight to ensure that they are carried out in accordance with the law.