Legal issues of general application

Government permission

What government approvals are required for typical project finance transactions? What fees and other charges apply?

Depending on the sector, project financing transactions might be subject to government approvals. This may apply to investments in equity, debt or to operating activities, etc. Approval authorities are basically the DETEC and its agencies or cantonal governments (see also questions 16 and 17). As a rule, with regard to financing, a private entity, albeit state-controlled such as Swisscom, applies private law, and no government approvals are required.

Registration of financing

Must any of the financing or project documents be registered or filed with any government authority or otherwise comply with legal formalities to be valid or enforceable?

The disposition, including encumbering, of real estate requires a notarised deed and registration in the land register. If real estate is subject to Swiss rural and land protection legislation, approval may be sought from the appropriate authorities for an investment by foreign nationals (see question 10). Further, depending on the project, party and question involved (eg, in relation to PPP), relevant financing and project documents may need to be submitted to competent authorities for information or approval. This can include, but is not limited to, planning, zoning, tax, construction and environmental issues and concessions. Of course, if the public sector is party to an agreement, the execution, delivery and performance of respective agreements must be duly authorised by the competent authority. In addition, the Federal Public Procurement Act (PPA) applies to public procurement projects of the Swiss Confederation and sets forth rules for participation, qualification, and awarding. Awarding of projects is done by means of formal decrees, which are subject to appeal.

Arbitration awards

How are international arbitration contractual provisions and awards recognised by local courts? Is the jurisdiction a member of the ICSID Convention or other prominent dispute resolution conventions? Are any types of disputes not arbitrable? Are any types of disputes subject to automatic domestic arbitration?

Switzerland is a very arbitration-friendly country and an important arbitration venue. Not only Swiss disputes, but also foreign disputes are regularly arbitrated in Switzerland. Switzerland is a signatory state to the International Centre for Settlement of Investment Disputes Convention and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards and, therefore, foreign arbitration awards are recognised and enforceable in Switzerland.

Law governing agreements

Which jurisdiction’s law typically governs project agreements? Which jurisdiction’s law typically governs financing agreements? Which matters are governed by domestic law?

Project or joint venture agreements are normally governed by Swiss law, in particular, when there is a Swiss project company. The law governing financing agreements may follow the country of the arranger, lead manager or original lender, in particular, in large internationally syndicated loans. Security agreements involving Swiss security interest or Swiss companies are regularly subject to Swiss law. Irrespective of the chosen law, Swiss tax rules may apply and must be dealt with appropriately (see questions 1, 7 and 15).

Submission to foreign jurisdiction

Is a submission to a foreign jurisdiction and a waiver of immunity effective and enforceable?

A Swiss company may subject itself to foreign jurisdiction. Also, state-owned private enterprises are free to do so with respect to their private (as opposed to public) activities. Swiss courts would recognise a final and conclusive judgment of a foreign court, subject to Swiss conflict of law rules and international treaties such as the Lugano Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters.