Switzerland: Bilateral Cooperation Agreement In Competition Matters

Last Updated: 25 September 2013
Article by Jürg Borer, David Mamane and Samuel Jost

The European Union and the Swiss Confederation have signed a Cooperation Agreement in Competition Matters. The agreement provides for broad possibilities of the Swiss competition authority and the European Commission to exchange protected or confidential information they have obtained in their investigations, even without the consent of the investigated companies.


1.1 The current legal framework

In a globalized economic environment, competition authorities are investigating potential anti-competitive behavior on a transnational level. This triggered the authorities' desire to cooperate with their international counterparts in order to reduce the risk of diverging assessments and lack of information levels in parallel procedures.

The Cooperation Agreement ("CA") between Switzerland and the European Union ("EU") is the first so-called "second- generation" agreement. It is characterized by broader possibilities for information exchange in particular against the will of the investigated companies. Previous cooperation agreements enable some cooperation on a transnational level, but do not allow exchanging confidential information without the explicit consent of the investigated company.

1.2 The current status in the process of ratification

The CA was signed on 17 May 2013 by the European Council and the Swiss Federal Council, and on 22 May 2013 the Swiss Federal Council adopted its explanatory report to the Swiss Parliament (the so-called "message"). Before entering into force, the CA must be ratified by the European Parliament and the Swiss Parliament. In Switzerland, there is also the possibility of a public referendum.

1.3 Delivery of Official EU Documents in Switzerland

In addition, and at the time of the signing of the CA, the European Commission and the Swiss Federal Council exchanged diplomatic notes on the notification of acts of the European Commission to companies in Switzerland. This will speed up the process of delivering EU decisions to companies in Switzerland. There is no corresponding obligation of the EU regarding the decisions of the Swiss Competition Commission ("ComCo").


2.1 Notifications and Conflict Avoidance

The CA provides for general information duties to facilitate the coordination of transnational procedures. The competition authorities will notify each other on their enforcement activities if such activities could have an effect on important interests of the other party. This should avoid or lessen the risk of conflicts (negative comity). Furthermore, one competition authority may ask the other authority to initiate or expand enforcement activities if the other competition authority is better positioned (positive comity).

2.2 Information Exchange and its Limitations in General

The exchange of case-specific information is at the heart of the CA and of particular importance for companies involved in international business relationships. In this context, the CA allows the exchange of information that would otherwise be treated as confidential.

According to art. VII(2) CA, the authorities are allowed to discuss "any information, including information obtained by investigative process". If the information contains personal data, a transfer is only possible if the authorities are investigating the same or related conduct or transaction (art. VII(3) and VII(4)(a) CA). However, the authorities are not required to discuss or transmit any information, particularly if important interests are at stake or if such transmissions would be unduly burdensome (art. VII(5) CA).

In the context of the information exchange, the authorities must ensure the protection of personal data in accordance with their respective legislations. Therefore, the Swiss Federal Act on Data Protection ("FDAP") should generally protect all data of Swiss companies. However, the FDAP is not limited to the protection of data relating to natural persons, but also protects data relating to legal entities, whereas within the EU most Member States do not grant such protection. The level of protection for legal entities is thus not equivalent in these EU Member States. Absent overriding public interests of the Swiss Confederation, or any other safeguards, such as contractual guarantees or the explicit consent of the affected legal entities, the ComCo might not be able to transfer such data.

Furthermore, the CA does not provide any rules with regard to the transfer of information subject to specific Swiss blocking statutes, such as in particular Swiss banking secrecy. Therefore, it is questionable whether the data relating to bank customers can be transmitted under the CA, or whether the Swiss competition authority would have to reject any such transfer because there is no equivalent level of protection available in the EU.

2.3 Transfer of Information against the Will of the Concerned Enterprises

The main subject of concern for companies is the possibility to exchange information in the absence of consent by the investigated companies and therefore possibly against their will (art. VII(4) CA).

However, the information exchange is subject to certain conditions and rules:

  • Formal request: The requesting authority must demonstrate in writing the subject matter and nature of the investigation and identify the relevant procedure (art. VII(4)(b) CA).
  • Consultation on the scope: The receiving authority can determine in consultation with the requesting authority what information shall be relevant and transmitted (art. VII(4)(c) CA). Together with art. VII(5) CA, this process will leave some margin of appreciation on the information exchange to the receiving authority.
  • Identity of the procedure: The information may be transmitted only if both authorities are conducting investigations of "the same or related" conduct or transactions (art. VII(4)(a) CA).
  • Only information that is already available: The requested information needs to be already in the possession of the authority receiving the request (art. VII(4) CA), which excludes the collection of specific information on behalf of the requesting authority.
  • No information in the context of settlements and leniency applications: The authorities are not allowed to discuss or transmit information obtained under a leniency or settlement procedure, unless the relevant company has given its express written consent (art. VII(6) CA). While this is a necessity in order to ensure that leniency and settlement procedures remain attractive, the current wording provides for some uncertainties. First, the CA does not regulate the fate of information that has already been discussed or transmitted if subsequently a settlement can be reached. A claw-back mechanism withdrawing all information/documents from the files of the receiving authority would be necessary. Second, the scope of information is unclear. Since the CA refers to "information obtained under the [...] settlement procedures", this should refer to the entire set of information that has been collected pending the conclusion of the settlement agreement. Third, the timing may be problematic. Given the fact that in Switzerland a settlement must be confirmed by the ComCo in its final decision, the prohibition against transferring information according to Art. VII(6) CA only makes sense if it is already binding once settlement talks have commenced.
  • Procedural guarantees: The authorities may not discuss, request or transmit information, the use of which would be prohibited under their procedural rules (art. VII(7) CA). This refers in particular to the privilege against self-incrimination and the legal professional privilege. Such prohibition should protect information at the highest possible level of either authority (i.e. the Swiss competition authority could not request information that is protected under the EU's procedural rights, even if such information is not subject to the same protection in Switzerland, and vice versa).
  • Judicial protection: The CA does not include any rules on the right to appeal a decision of the authority to exchange information in the absence of consent. In addition, according to the opinion of the Swiss Federal Council the transfer of information is not an act against which an appeal is possible. Given the far-reaching consequences, and in particular in light of the (quasi-)criminal nature of competition law fines, such lack of judicial protection is problematic. Therefore, even if the information exchange could possibly be appealed together with the final decision, it is inappropriate that no possibility to appeal a decision to transfer information is provided. It remains to be seen whether the appeals authority will accept any appeals against such a decision.

2.4 Use of the transmitted Information

The receiving authority may use the information only for the purpose of enforcing its competition law (art. VIII CA). In the absence of the explicit consent to an information exchange, the use of information is limited to the same or related conduct or transaction. Furthermore, the transferred information may on no account be used in order to impose sanctions on natural persons (art. VIII(4) CA). The European Commission must therefore ensure that EU national authorities will not impose sanctions on natural persons based on the transferred information.

Finally, the exchanged information may be disclosed by the European Commission for specific purposes, such as for a court order for the public enforcement of the respective competition laws, for the disclosure to other parties to an investigation if the information is being used against them, for disclosures to courts in appeal procedures and, insofar as a disclosure is indispensable, for the right of access to documents under the respective procedural laws. Within the European Competition Network ("ECN"), information will also be made available to the national authorities of all EU Member States, which limits the control over the information. This may lead to significant disclosures of information and it cannot be excluded that civil plaintiffs could also try to access such documents.


The EU and Switzerland have not yet entered into an agreement regarding the notification of decisions in competition matters. Therefore, such decisions have in general to be sent through the diplomatic channel if the addressee is domiciled in the other contractual state.

In order to implement a unilateral possibility for serving acts of public authority in the field of competition policy it is foreseen that the European Commission's decisions will be sent to the ComCo which will pass it on to the addressee domiciled in Switzerland. Such acts of public authority in the field of competition policy relate to decisions in the context of concentrations and investigations, including decisions imposing fines. This can have a major impact on the undertakings concerned and will simplify the procedure for the European Commission to deliver e.g. sanction decisions to companies in Switzerland.

However, the system is asymmetrical: There will be no corresponding notification system for delivering acts of the ComCo within the EU because the EU Member States are competent to define the rules concerning the service of legal documents in their territory. The EU merely declared to inform the Member States of the approach agreed upon and to inquire with them whether they object to the direct notification by the ComCo to an addressee in their territories or whether they could consider accepting a procedure similar to that agreed between the European Commission and Switzerland. It remains to be seen how the EU Member States will react and whether they will implement a similar notification system.


The Cooperation Agreement between the EU and Switzerland foresees far-reaching possibilities to exchange information. In particular, the possibility to transfer information against the will of the investigated companies will trigger significant consequences. Companies will have to take into consideration the CA in particular when preparing dawn raid guidelines or when assessing multi-jurisdictional leniency applications. It will be necessary to carefully plan the strategies in such procedures.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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