1. Consumer Protection
For the time being, there are no specific consumer protection laws in place for e-commerce. However, some of the existing dispositions apply also to e- commerce. For example, the price announcement decree which states the obligation to indicate the valid price also in advertising, is considered unanimously to be valid also for Internet advertisement.
There are some legislative changes being discussed relating to the information and protection of young consumers. A motion has been made to rely the new consumer protection dispositions on the EU-regulation from December 23, 1998 and August 17, 1999 (COM 1998.586.final and Doc. 98.0325-COD) as well as on the declaration of the conference of ministers of OECD from October 7- 9, 1998 (Doc. SG/EC (98) 14/final), especially to implement a 7-days revocation right. This legislative changes will be published and will be enacted after a hearing which will probably take place this spring. This consumer protection dispositions, valid and future ones, cannot be contracted out.
There are no specific regulations in place relating to the giving of professional advice over the internet.
2. Contract Formation
There are no new dispositions been implemented relating to electronic contact formation. The dispositions contained in the Swiss Code of Obligations are unanimously considered applicable to electronic contract formation and except the above mentioned revocation right and consumer protection aspects, nothing seems to be missed. The general opinion is, that contract formation problems can be solved by applying the dispositions contained in the Swiss Code of obligations and other related laws and decrees and by the precedents. Concerning the e-signature, a new law is in preparation and will probably become effective in the course of 2001. This new legislation is also inspired by the EU Guideline on electronic signatures.
3. Taxation Issues
There has been no changes in taxation laws to deal specifically with e-commerce and internet aspects.
As the main criteria for determining where direct taxes are payable is the location of the place of operation. In Swiss tax law, one has a place of operation in a specific place, if there is a physical plant or installations, the activity has a qualitative and quantitative significance and belongs to the company as a part of it. Therefore, a distinction must be made between companies having their own servers and companies renting a server on one hand, and companies just using a server through a service provider on the other hand. A own server is considered to be a installation and therefore the place where the server is located would be considered as place of operation and create a tax obligation. This would also be the case if the company does not employ personal at this place, other than persons operating the server.
However, the server must be located at a certain place for about 12 month in order to be considered a physical installation. The same is valid for the renting of a server. However, the use of a service provider will not create a place of operation at the location of the service provider.
The location of the performer is essential for the VAT. A distinction must also be made between an seller and a performer of services, as regarding the selling of goods, the VAT is payable by the importer. Concerning the service performer, the location will be determined by the domicile of the company. If the company does not have a domicile in Switzerland, it's services will not be subject to VAT. However, for most services performed by e- commerce, the VAT will, based on Article 14 III Swiss Law on VAT, be payable where the recipient of the service is domiciled. Foreign domiciled companies are excepted from VAT if they provide only services for which the principle of receiver domicile is valid ( ex: transferring of IP rights, professional advice by lawyers, fiduciary, in matters of telecommunication, translation,.).
4. Jurisdiction And Choice Of Law
For e-commerce, the actual dispositions stay valid. Therefore, the consumer protection dispositions contained in the international private law as well as in international conventions stay valid and choices of law and jurisdiction will have to comply with these, especially with regard to the Business to Consumer transactions. The question of the necessary presence has not been addressed yet by Swiss courts, but the general opinion is, that the consideration made above regarding the physical presence for tax purposes is also valid for the creation of a forum.
Care should be exercised in relying upon the undermentioned article, as the relevant law may have changed since the date of the article. For further information please contact the author/firm