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19 November 2024 Civil Procedure Code (CPC) Revision: Improving International Commercial Jurisdiction

Switzerland is renowned as an exceptional venue for resolving international disputes. Cities like Geneva and Zurich are popular as arbitration hubs due to their stable institutions, neutrality, and extensive legal expertise.

With the upcoming revision of the Civil Procedure Code (CPC), set to take effect on 1 January 2025, companies engaged in international trade will obtain the possibility of benefitting from Swiss venues' advantages also in state court proceedings as well.

The amendment to the CPC allows the cantons to declare their commercial courts competent for international disputes, provided the following conditions are met (art. 6 para. 4 (c) nCPC):

  • The commercial activity of at least one party is concerned.
  • The amount in dispute exceeds CHF 100,000.
  • The parties agree to the jurisdiction of the commercial court.
  • At the time of the agreement on the commercial court's jurisdiction, at least one party has its domicile or registered office abroad.

This newly introduced provision is particularly relevant for parties that are both not registered in a commercial registry, as such parties were previously often excluded from the jurisdiction of commercial courts.

A notable aspect of this amendment is the option to conduct proceedings in English. This change not only facilitates communication between international parties but also allows judgments to be rendered in English by the commercial court. While appeals to the Federal Supreme Court may be submitted in English, the Court will issue its judgment in a national language.

The new regulation offers cantons flexibility in positioning their commercial courts as international fora. The Canton of Zurich, for example, had already made an initial political move in 2018 with a proposal to establish a Zurich International Commercial Court. However, the absence of federal regulatory support meant that initiative could not be implemented at that time. It remains to be seen how quickly the newly provided option to establish a Zurich International Commercial Court will be made use of.

These developments in Switzerland align with similar initiatives in other countries, including France, Singapore, and the Netherlands, which have also established specialised state courts for international commercial disputes.

The SCPC revision marks a significant step towards a greater internationalisation of the Swiss judiciary. The option to conduct international commercial litigation before specialised commercial courts in English will enhance Switzerland's appeal as a venue for companies with global business relations.

Switzerland’s combination of a proven legal infrastructure, neutral jurisdiction, and procedural language flexibility positions it as a leading venue for international commercial disputes, offering new perspectives for businesses worldwide. It is to be hoped that the cantons will swiftly implement this opportunity to introduce commercial international courts provided by federal law.

The VISCHER litigation team will be happy to answer any questions you may have in connection with this new regulation and international commercial disputes in general.

Here you will find the overview of the CPC blog series.

Author: Selim Keller

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