Regulatory frameworkRegulators and primary legislation
Which bodies regulate aviation in your country? Under what basic laws?
The Federal Constitution of the Swiss Confederation provides that legislation pertaining to aviation is a federal matter. The main body that regulates aviation is the Federal Office of Civil Aviation (FOCA), which is part of the Federal Department of Environment, Transport, Energy and Communications (DETEC). FOCA is responsible for supervising civil aviation activities and aviation development.
Aviation in Switzerland is governed by international, European and national (federal and cantonal) laws, all of which are, in principle, directly applicable in Switzerland. On the international level, the most pertinent are the 1944 Chicago Convention on International Civil Aviation (the Chicago Convention) and its Annexes, a large number of bilateral air services agreements, and the 1999 Montreal Convention for the Unification of Certain Rules for International Carriage by Air (the Montreal Convention). Switzerland is not a member of the European Union, but has adopted most of the EU’s aviation laws through the Agreement between the European Community (EC) and the Swiss Confederation on Air Transport of 1999 (the EU-Switzerland Agreement). The main piece of national aviation legislation is the Swiss Federal Aviation Law of 1948, as amended.
Switzerland is a member of many aviation-related organisations, such as the International Civil Aviation Organization (ICAO), Eurocontrol, the European Civil Aviation Conference and the European Aviation Safety Agency (EASA).
Aviation operationsSafety regulations
How is air transport regulated in terms of safety?
The principal body responsible for creating and implementing the framework for safe air operations is FOCA, although an increasing role is being played by EASA.
Regarding commercial air transport, FOCA only grants an air operator’s certificate (AOC) if the company has and continues to have the professional ability and organisation to secure safe operation of the aircraft.
Particularly noteworthy in this respect is Regulation (EC) No. 859/2008, amending Regulation (EEC) No. 3922/1991, which Switzerland agreed to adopt under the EU-Switzerland Agreement. The amendment contains an Annex, commonly referred to as EU-OPS1, which deals with the operation of aircraft for the purpose of commercial air transport. This set of rules provides for standards and procedures, with which AOC holders must comply.
Flight crews must hold the necessary and valid pilot’s licences and ratings required for the aircraft and type of flight in question. Switzerland implemented Commission Regulation (EU) No. 1178/2011 laying down technical requirements and administrative procedures related to civil aviation air crew.
Switzerland also adopted Regulation (EC) No. 1702/2003, containing rules for initial airworthiness, and Regulation (EC) No. 2042/2003 on continuing airworthiness of aircraft. Under these and national rules, aircraft may not be operated unless they are maintained in an airworthy condition. Before aircraft are entered into the Swiss aircraft register, they must undergo technical inspections that confirm that all technical requirements are met. Aircraft are continually monitored and periodically checked when they are operated. In addition, maintenance companies for aircraft and aircraft components must have an approval certificate, and persons that perform maintenance work must be properly licensed.
Air traffic control services are provided by Skyguide Swiss Air Navigation Services, which is commissioned by the Swiss Confederation to manage and monitor both civil and military air traffic. FOCA regulates the safety management of Skyguide. Air traffic controllers must also be properly licensed.
What safety regulation is provided for air operations that do not constitute public or commercial transport, and how is the distinction made?
Air operations that do not constitute commercial transport do not require an operating licence, subject to certain exceptions. Such private flights, however, need to comply with general safety requirements, including airworthiness of the aircraft, pilot licensing and operational standards and procedures.
All flights of air transport undertakings holding an operating licence are presumed to be commercial. Pursuant to Regulation (EC) No. 216/2008, the term ‘commercial operation’ shall mean any operation of an aircraft, in return for remuneration or other valuable consideration, which is available to the public or, when not made available to the public, which is performed under a contract between an operator and a customer, where the latter has no control over the operator. To the extent that the Swiss Air Navigation Regulation applies, a flight will be considered private if the following applies:
- no valuable consideration is given for more than the costs of the lease for the aircraft, including fuel and airport and air traffic control charges; and
- the flight is not accessible to an unspecified number of persons.
How is access to the market for the provision of air transport services regulated?
FOCA grants operating licences under Regulation (EC) No. 1008/2008 on rules for the operation of air services and national law, if certain requirements are satisfied. These include the applicant’s:
- principal place of business;
- ownership and control;
- financial fitness;
- adequate insurance;
- holding of a valid AOC;
- aircraft, including compliance with standards concerning noise and pollution; and
- ability to operate aircraft in an environmentally responsible manner.
Pursuant to Regulation (EC) No. 1008/2008, a Community air carrier holding a valid operating licence is permitted to exercise traffic rights within the EU and Switzerland. Switzerland may, however, impose conditions on, limit or refuse the exercise of traffic rights when serious congestion or environmental problems exist, particularly when other modes of transport provide satisfactory levels of service.
For scheduled air services with respect to routes outside the EU and Switzerland, FOCA grants operating permits and route licences according to the conditions agreed upon in the relevant bilateral air services agreement.
In addition, flight operations to and from Zurich and Geneva Airports require the allocation of slots by Slot Coordination Switzerland, a non-profit organisation, in accordance with the procedures established in the Worldwide Slot Guidelines (WSG) of the IATA and the provisions of Regulation (EEC) No. 95/93.Ownership and control
What requirements apply in the areas of financial fitness and nationality of ownership regarding control of air carriers?
Under Regulation (EC) No. 1008/2008 and national law, the applicant must prove to FOCA that at any time in the 24-month period beginning with the start of operations, it can meet its actual and potential obligations as established under realistic assumptions. Additionally, the applicant must show its ability to meet its fixed and operational costs for the first three months without taking into account any income from its operations. Thereafter, the carrier must be able to demonstrate to FOCA that it can meet its actual and potential obligations over a 12-month period.
For routes within the EU, in accordance with Regulation (EC) No. 1008/2008, the holder of an operating licence must at all times be able to demonstrate to FOCA that it is owned directly or through majority ownership by either EU member states or Switzerland or nationals of either EU member states or Switzerland. It must also be effectively controlled by such states or nationals.
With respect to scheduled air services outside the EU and Switzerland, the conditions agreed upon in the relevant bilateral air services agreement apply. Traditionally, most air service agreements require that the designated air carriers must be substantially owned and effectively controlled by the respective states or their citizens. These ownership and control rules, however, have been an issue in the context of multinational mergers and takeovers of airlines, for instance in Lufthansa’s takeover of Swiss International Airlines. Thus, many air services agreements involving Switzerland now contain a clause that merely requires a designated air carrier to be incorporated and to have its principal place of business in the country of designation.Licensing
What procedures are there to obtain licences or other rights to operate particular routes?
An air carrier holding an operating licence issued by an EU member state no longer requires separate permission for flights between the EU and Switzerland (Regulation (EC) No. 1008/2008). Cabotage flights within Switzerland currently fall outside the EU-Switzerland Agreement and require prior permission.
An air carrier of an EU member state that plans to operate flights between Switzerland and a country outside the EU is required to apply for the exercise of the respective traffic rights (the fifth freedom of the air, concerning traffic to and from non-EU countries).
An air carrier incorporated outside the EU that plans to operate scheduled services to and from Switzerland is required to apply for an operating permit and a route licence. FOCA will grant the operating permit provided that the air carrier is duly authorised by the authorities of its home country to operate international services. The route licence is granted according to the conditions agreed upon in the relevant bilateral air services agreement.
What procedures are there for hearing or deciding contested applications for licences or other rights to operate particular routes?
If FOCA rejects an application, the applicant may appeal to the Federal Administrative Court. Competitors may also be heard under certain circumstances.Competition policy
Is there a declared policy on airline access or competition? What is it?
The Swiss Federal Council published its latest aviation policy report in 2016, in which the Federal Council stressed the importance of direct air transport connections to European and global centres and the need to strengthen the competitiveness of Swiss air transport companies.Requirements for foreign carriers
What requirements must a foreign air carrier satisfy to operate in your country?
See questions 4 and 6.Public service obligations
Are there specific rules in place to ensure aviation services are offered to remote destinations when vital for the local economy?
Switzerland may impose public service obligations with respect to scheduled air services on routes that are vital for the economic development of the region they serve. Regulation (EC) No. 1008/2008 contains specific rules.Charter services
How are charter services specifically regulated?
There is no special regulation of charter services as regards operations within the EU and Switzerland; the European regulatory framework applies to all commercial air services, including charter services.
An air carrier incorporated outside the EU that plans to operate charter services to and from Switzerland is required to apply for an operating permit (a route licence is not necessary). FOCA issues such permits for third and fourth freedom flights.
If the carrier wishes to operate fifth or seventh freedom traffic rights, it is also required to apply for approval. FOCA approval is subject to the applicant providing a declaration of reciprocity issued by the national civil aviation authority of its home country.Regulation of airfares
How are airfares regulated?
Under Regulation (EC) No. 1008/2008, EU and Swiss carriers are free to set airfares. Regulatory approval is not required.
Non-EU scheduled air services are subject to the conditions agreed upon in the relevant bilateral air services agreements. FOCA may need to be notified of airfares.
The final price to be paid by the customer for air services should always be indicated inclusive of all taxes, charges and fees. This principle applies to all advertising by air carriers, tour operators and travel agencies on Swiss territory.Drones
How is the operation of unmanned aircraft systems (drones) regulated?
In Switzerland, the following national legal instruments apply to drones:
- the Aviation Ordinance, which distinguishes between two categories of drones, depending on whether they are heavier than 30kg. Drones weighing more than 30kg may be operated only if authorised by FOCA. For drones lighter than 30kg, no operation authorisation is necessary, as long as the pilot maintains visual contact with the device at all times and does not fly the drone above gatherings of people; and
- the Ordinance on Special Category Aircraft, which provides for a more detailed framework on drone operations.
Drones weighing less than 30kg may be subject to further regulation at the cantonal level. Such local regulations are intended to mitigate the risks to third parties and property on the ground, as well as to reduce their environmental impact. The city of Zurich had previously banned the operation of drones above public ground altogether, although this ban was repealed in 2015.
The EU is currently developing and implementing a more comprehensive regulatory framework for drones. On 11 June 2019, the Commission Delegated Regulation (EU) No. 945/2019 and Commission Implementing Regulation (EU) No. 947/2019 were published to ensure drone operations across all EU member states are safe and secure. The new rules cover each operation type, from those not requiring prior permission to those involving certified drones and operators, as well as minimum pilot training requirements. While the EU regulation has already entered into force, it will be applicable only in a year’s time, to give EU member states and operators time to prepare and implement it. As of June 2020, operators of drones will need to register in the member state where they have their residence or their main place of business.
It is likely that Switzerland will adopt the new EU regime on drones. It is therefore expected that the above-mentioned Swiss regulation will be repealed in the near future.
Who is entitled to be mentioned in the aircraft register? What requirements or limitations apply to the ownership of an aircraft listed on your country’s register?
Both the owner and operator are mentioned in the aircraft register, but the entry does not constitute ownership in the legal sense. Registration of ownership with an effect on third parties must be done in the aircraft ownership and mortgage register (see question 15). Lessees and mortgagors are also recorded in such register.
An aircraft can only be registered if it is owned by Swiss nationals, companies with their seat in Switzerland, Swiss public corporations and agencies or Swiss private associations (if two-thirds of their members are Swiss nationals). Foreign individuals are entitled to own a Swiss aircraft if they have a permanent residence permit for one or more years. Foreigners who do not live in Switzerland and foreign companies may receive equal treatment through bilateral treaties. Based on the EU-Switzerland Agreement, this is the case for citizens and companies of EU member states.Mortgage register
Is there a register of aircraft mortgages or charges? How does it function?
Apart from the aircraft register, Switzerland also maintains an aircraft ownership and mortgage register (in compliance with the 1948 Geneva Convention on the International Recognition of Rights in Aircraft). In this register, mainly ownership and mortgages are recorded, but restraints on disposal or leasing and charter agreements (with duration of at least six months) may also be registered. Lessors and charterers may register their agreements in the aircraft ownership and mortgage register, but they are not obliged to do so. The entry would, however, affect third parties and an acquirer of an aircraft would also step into those existing leasing agreements recorded in such register.
The status of a mortgage relates to the day of registration and the entries in the register are deemed to be publicly known. There are also statutory liens on the aircraft for salvage compensations and extraordinary expenses indispensable for the prevention of aircraft. They must be registered within three months after the lien has come into existence, otherwise, the liens will extinguish.
The Cape Town Convention has not yet been ratified by Switzerland.Detention
What rights are there to detain aircraft, in respect of unpaid airport or air navigation charges, or other unpaid debts?
Normally there are no rights to detain aircraft in respect of unpaid airport charges, air navigation charges or other unpaid debts. Switzerland is a signatory to the 1933 Rome Convention on Precautionary Arrest of Aircraft, which, in most cases, prevents precautionary attachment or detention of aircraft. Exceptions apply with regard to operating private (non-commercial) and certain non-scheduled flights.Maintenance
Do specific rules regulate the maintenance of aircraft? What are they?
Regulations regarding maintenance, repair and overhaul are contained in Annex 8 to the Chicago Convention, in publications of EASA, as well as in national regulations. The most relevant legislation in that regard is the above-mentioned Regulation (EC) No. 2042/2003 that lays down technical requirements and administrative procedures for ensuring continuous airworthiness of aircraft, including any component for installation thereon which are registered in a member state of EASA, including Switzerland. Maintenance organisations need approval from FOCA. Certifying staff must also be qualified. Organisations involved in the training of personnel, such as certifying staff, must also be approved by FOCA.
Who owns the airports?
Most larger airports in Switzerland are either directly or indirectly state-owned. For instance, Geneva Airport is organised as a public agency owned by the canton of Geneva.
Basel-Mulhouse-Freiburg Airport is located completely on French soil, but jointly operated by Switzerland and France. It is organised as a state-owned public enterprise.
Zurich Airport is partly privatised. Zurich Airport AG is both owner of the airport infrastructure and operator of Zurich Airport and is thus responsible for managing Zurich Airport. Shares of Zurich Airport AG are listed on the Swiss Stock Exchange; the major shareholders are the canton and (to a lesser extent) the city of Zurich.Licensing
What system is there for the licensing of airports?
Public airports need a licence, which may be granted by DETEC. The licence grants the right to operate the airport commercially in accordance with the Sector Plan Infrastructure of Aviation, and to impose airport charges. The licensee must provide the necessary infrastructure and must ensure that the airport is operated in a safe and secure manner. In addition, the licensee has the duty to open the airport to all aircraft, regardless of whether aircraft are operating nationally or internationally, subject to certain exceptions.
Non-public airports must be approved by FOCA, which defines the rights and duties that are attached to the operation of these airports.Economic regulation
Is there a system of economic regulation of airports? How does it function?
Swiss airport authorities levy charges for the use of the airport, for instance landing charges, noise charges (according to noise classes), pollution charges (according to pollution emission classes), parking charges, passenger charges, cargo charges and security charges. Charges must not be discriminatory and, in principle, users shall bear their share of the cost of having access to the airport, as provided for in article 15 of the Chicago Convention and in ICAO’s policies on airport charges, as well as under national laws.Access
Are there laws or rules restricting or qualifying access to airports?
Specific operating regulations, including restrictions to arrivals and departures at night, apply for all Swiss airports.
As regards air traffic services to and from the EU, access to Swiss airports may be restricted in accordance with Regulation (EC) No. 1008/2008, which states, as mentioned above, that the exercise of traffic rights may be conditioned, limited or refused, when serious congestion or environmental problems exist, in particular when other modes of transport provide satisfactory levels of service.
The operation of Zurich Airport is also affected by controversial unilateral German ordinances, which prohibit overflight of southern German airspace during certain operating hours.Slot allocation
How are slots allocated at congested airports?
Slots are allocated in accordance with the procedures established in IATA-WSG and Regulation (EEC) No. 95/93. Airports may be designated as ‘schedules facilitated’ or ‘coordinated’, depending on the level of congestion. At coordinated airports, such as Zurich and Geneva (but not Basel), a coordinator is appointed who must act in an independent, neutral and non-discriminatory manner. In Switzerland, the coordinator is a non-profit organisation by the name of Slot Coordination Switzerland (SCS). SCS is financed through Swiss airports (49 per cent), airlines holding a Swiss AOC (49 per cent) and FOCA (2 per cent).
The core of the slot allocation process is the use of historical precedence. Incumbent airlines have ‘grandfather rights’ giving them preferential rights to slots, provided that at least 80 per cent of the slots were operated by the airline (‘use it or lose it’ rule). Some preference is also given to new entrant airlines that may obtain slots from a slot pool, consisting of unused and newly created slots. Airlines may transfer slots from one route to another route (operated by the same airline). Airlines are also permitted to exchange slots on a one-to-one basis. Moreover, slots may be transferred between parent and subsidiary companies and between subsidiaries, and in the case of a takeover when the slots are directly related to the airline taken over.Ground handling
Are there any laws or rules specifically relating to ground handling. What are they?
Ground handling services are regulated on the basis of EC Directive 96/67/EC, which essentially provides that, at larger airports, access to the market by suppliers of ground handling services must be free, and that for certain categories of services the number of suppliers should be at least two. At least one of these suppliers should be independent from the airport or the dominant airline at that airport. Similar rules apply to self-handling, which means that airlines provide the services in question for themselves: there should be at least two airlines admitted for these services.Air traffic control
Who provides air traffic control services? And how are they regulated?
As previously mentioned, air traffic control services are provided by Skyguide Swiss Air Navigation. Skyguide is a non-profit public limited company that is over 99 per cent owned by the Swiss Federation. Ownership is exercised through DETEC, which must approve strategic goals, board appointments and fees, which are paid by the users of Skyguide’s services.
FOCA regulates the safety management of Skyguide and DETEC is empowered to regulate fees.
Liability and accidentsPassengers, baggage and cargo
What rules apply in respect of death of, or injury to, passengers or loss or damage to baggage or cargo in respect of domestic carriage?
In the case of EU and Swiss air carriers, domestic carriage is governed by Regulation (EC) No. 2027/97 as amended by Regulation (EC) No. 889/2002. These Regulations implement provisions of the Montreal Convention (which applies to international carriage) on air carrier liability with respect to carriage of passengers and their baggage. According to these rules, liability of the carrier for bodily injury or death of a passenger is premised upon there being an accident on board the aircraft or in the course of embarking or disembarking. The carrier is strictly liable for the first 131,100 special drawing rights (SDR). Above that amount, the carrier can defend itself against a claim by proving that it was not negligent or otherwise at fault. For loss or damage to baggage, the carrier is liable for up to 1,131 SDR.
For cases that fall outside the scope of Regulations (EC) Nos. 2027/97 and 889/2002, the Swiss Ordinance on carriage by air applies the provisions of the Montreal Convention to domestic carriage.
In the case of loss or damage to cargo, the carrier’s liability is, in principle, limited to a sum of 19 SDR per kilogram.Surface damage
Are there any special rules about the liability of aircraft operators for surface damage? What are they?
Pursuant to the Swiss Aviation Act, the aircraft operator is strictly liable without limitation for all surface damage caused by the aircraft. If the aircraft was used by a third party without the permission of the operator, such third party will be liable. Nevertheless, the operator (or rather its insurer) will still have to provide the minimum insurance coverage, which depends on the maximum take-off weight of the aircraft and is laid down in Regulation (EC) No. 785/2004.Accident investigation
What system and procedures are in place for the investigation of air accidents?
The Chicago Convention requires that the signatory states, including Switzerland, undertake to conduct investigations into those air accidents that take place within their own territory. ICAO issued Appendix 13 to the Chicago Convention containing guidelines as to how investigations of accidents and serious incidents should be conducted. The sole purpose of these investigations is the prevention of aircraft accidents and therefore the improvement of aviation safety. ICAO also recommends that air accidents be investigated by independent bodies.
In Switzerland, the Accident Investigation Board (AIB), which is part of DETEC, is the competent authority to conduct these investigations. If an accident or serious incident involving one or more aircraft takes place, it must be reported to the AIB. The AIB appoints an investigator who, together with police and experts, investigates the wreck and the accident site; the AIB then publishes a report of initial findings. The manufacturer of the aircraft, the engines and other equipment, as well as representatives of the airline, can take part in the investigation. The investigation concludes with a report determining the causes of the accident. The draft report will be submitted to the parties concerned and FOCA. The AIB may accept comments and objections, and then publishes the final report.
The report may include safety recommendations that are directed to FOCA. Such recommendations do not (or should not) represent an indication of blame or an opinion on the question of responsibility.Accident reporting
Is there a mandatory accident and incident reporting system? How does it operate?
Switzerland adopted Regulation (EU) No. 376/2014, which aims at preventing accidents through the reporting, analysis and follow-up of occurrences in civil aviation. The Regulation seeks to create incentives for reporting by recognising the ‘just culture’ concept, which establishes that aviation professionals should not be punished for actions, omissions or decisions taken by them that are commensurate with their experience and training, but in which gross negligence, wilful violations and destructive acts are not tolerated.
The main thrust of the Regulation is the translation of the just culture concept into specific and enforceable legal provisions. In particular, the Regulation states that information on occurrences cannot be used for the following:
- to attribute blame or liability; or
- for any other purpose than the maintenance and improvement of aviation safety.
Accordingly, reporters and other persons mentioned in the reports should be protected from blame and punishment. The Regulation provides that employees and contracted personnel shall not be subject to any prejudice (in particular by their employer or the organisation for which they render services) based on information collected through occurrence reporting systems.
To encourage reporting, the Regulation establishes that collected safety information shall be handled in such a way that it protects the confidentiality of the reporter and of other persons mentioned in the report, including through de-identification of details related to the persons involved. To achieve this, the division between departments handling the occurrence reports and the rest of the organisation is suggested.
Just culture does not mean full immunity and does not absolve aviation professionals of their normal responsibilities. The Regulation therefore draws a line between acceptable and unacceptable behaviour. Thus, the protection of aviation professionals under the Regulation does not apply to any of the following situations:
- in cases of wilful misconduct; or
- where there has been a manifest, severe and serious disregard of an obvious risk and profound failure of professional responsibility to take such care as is evidently required in the circumstances, causing foreseeable damage to a person or property, or which seriously compromises the level of aviation safety.
Competition lawCompetition law
Do sector-specific or general competition rules apply to aviation?
Under the EU-Switzerland Agreement, Switzerland adopted the EU competition rules to the extent that they concern air transport or directly related matters. Accordingly, the general EU competition rules (including articles 101 and 102 TFEU concerning the prohibition of anticompetitive agreements and concerted practices and the abuse of a dominant position as well as the EU merger control rules) apply to aviation. Those rules are enforced by the European institutions if the EU market is affected.
Agreements, decisions, concerted practices, abuses of a dominant position or mergers, which only affect trade within Switzerland, remain, however, subject to the general Swiss law competition rules. Under Swiss competition law, sector-specific rules do not apply to aviation.Regulator
Is there a sector-specific regulator, or are competition rules applied by the general competition authority?
There is no Swiss sector-specific regulator concerning the application of competition law in the air transport sector. Principal responsibility for the application of Swiss competition rules lies with the Swiss Competition Commission, which is the general competition authority.Market definition
How is the relevant market for the purposes of a competition assessment in the aviation sector defined by the competition authorities?
The same principles apply in the aviation sector as in other industry sectors. In order to determine the affected markets, it is necessary to first determine the relevant markets. The relevant market is made up of the product market and the geographic market.
The product market consists of all the products or services substitutable, due to their characteristics and use, to the product or service under consideration. The geographical market corresponds to the territory in which the potential partners of the operation are engaged.
In alliance agreements and mergers between airlines, the usual approach to relevant market definition in passenger services is the origin and destination city-pair. The relevant market includes all relevant services on the origin and destination city-pair in question.Code-sharing and joint ventures
How have the competition authorities regulated code-sharing and air-carrier joint ventures?
If a sufficiently high level of integration exists between the participating air carriers, code-sharing and joint ventures may amount to a merger. In such circumstances, prior clearance from the competition authorities is required, provided that specific turnover thresholds are met. Code-sharing and joint ventures may also be characterised as anticompetitive agreements that require a showing that their procompetitive effects outweigh any anticompetitive effects.Assessing competitive effect
What are the main standards for assessing the competitive effect of a transaction?
Agreements that significantly affect competition in the relevant market and are not justified on the grounds of economic efficiency and all agreements that lead to the suppression of effective competition are unlawful.
Practices of enterprises that have a dominant position are deemed unlawful when such enterprises, through the abuse of their position, prevent other enterprises from entering or competing in the market, or when they injure trading partners.
In the case of a merger, the mere possibility of the merger creating or strengthening a dominant position is not sufficient for an intervention. The merger must also eliminate effective competition.Remedies
What types of remedies have been imposed to remedy concerns identified by the competition authorities?
The remedies applied will vary depending on the competition analysis in an individual matter.
In January 2014, the Swiss Competition Commission prohibited a price cartel in the context of air freight. Between 2000 and 2005 several airlines agreed on certain elements of the price for air freight transport. The Competition Commission fined the airlines 11 million Swiss francs in total. Lufthansa, as part of the cartel, triggered the legal proceedings by self-denunciation and benefited from complete immunity from the sanction.
Financial support and state aidRules and principles
Are there sector-specific rules regulating direct or indirect financial support to companies by the government or government-controlled agencies or companies (state aid) in the aviation sector? Is state aid regulated generally?
While state aid is not regulated generally, the EU-Switzerland Agreement contains specific rules on financial support and state aid in the aviation sector.
What are the main principles of the state aid rules applicable to the aviation sector?
In the aviation sector, any aid granted by Switzerland or by an EU member state or through state resources that distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods is, insofar as it affects trade between the EU and Switzerland, unlawful.Exemptions
Are there exemptions from the state aid rules or situations in which they do not apply?
The prohibition of state aid does not apply to aid that:
- has a social character and is granted to individual consumers, provided that such aid is granted without discrimination; or
- makes good the damage caused by natural disasters or exceptional occurrences.
Further, the following may be considered lawful:
- aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious unemployment;
- aid to promote the execution of an important project of common European interest or to remedy serious disturbances in the economy; and
- aid to facilitate the development of certain economic activities or of certain economic areas, where such aid does not adversely affect trading conditions.
Must clearance from the competition authorities be obtained before state aid may be granted? What are the main procedural steps for doing so?
Under the EU-Switzerland Agreement, the Swiss Competition Commission and the European Commission review matters to which the prohibition of state aid of the EU-Switzerland Agreement may apply. The European Commission is responsible for the supervision of measures taken by the EU or its member states within the EU, and the Swiss Competition Commission is responsible for measures taken by the Swiss authorities in Switzerland.
The Swiss Competition Commission examines whether the following are compatible with the provisions on state aid of the EU-Switzerland Agreement:
- the drafts of decrees of the Swiss Federal Council that favour certain companies or manufacturing branches, in particular services and shareholdings of airlines; and
- similar support measures taken by cantons and communes or other Swiss bodies or institutions subject to public law or of mixed economic structure.
Switzerland and the EU ensure that the other party is informed of any procedure initiated to guarantee respect of the provisions of the agreement and may submit observations before a final decision is taken. Upon request by either Switzerland or the EU, the joint committee set up under the agreement discusses appropriate measures.Recovery of unlawful state aid
If no clearance is obtained, what procedures apply to recover unlawfully granted state aid?
See question 38.
What rules regulate denied boarding, cancellation or (tarmac) delay?
Based on the EU-Switzerland Agreement, Switzerland has adopted Regulation (EC) No. 261/2004 on passenger rights, which provides for compensation and assistance for passengers who are denied boarding or experience cancellation or long delays of their flight. If a flight is cancelled, or if passengers are denied boarding, passengers are entitled to receive assistance and, depending on the circumstances, compensation as follows:
- €250 for flights with a distance of up to 1,500 kilometres;
- €400 for flights with a distance of between 1,500 and 3,500 kilometres; and
- €600 for flights with a distance of more than 3,500 kilometres.
Regulation (EC) No. 261/2004 applies to flights between Switzerland and the EU. Whether it also applies to flights between Switzerland and countries outside the EU is unclear. The European Court of Justice ruled in Sturgeon and other cases that passengers whose flights are delayed by at least three hours are entitled to standardised financial compensation, notwithstanding the fact that the wording of Regulation (EC) No. 261/2004 provides no such remedy. A Swiss first-instance court held in February 2016 that Sturgeon is not a precedent that the Swiss courts have to follow.Package holidays
What rules apply to the sale of package holiday products?
The Federal Act on package holidays contains provisions on the liability of tour organisers and their obligation to secure the repayment of prepaid charges and to provide for the return journey in case they declare themselves bankrupt. The Act implements Directives (EC) 90/314 on package travel, package holidays and package tours and 93/13 on unfair terms in consumer contracts.Other consumer legislation
Is there any other aviation-specific consumer legislation?
Regulation (EC) No. 1107/2006 on rights of disabled persons and persons with reduced mobility is in force in Switzerland. It applies to passengers with disabilities or reduced mobility departing from, on transit through, or on arrival at an airport situated in the EU including Switzerland. Articles 3 (prevention of refusal of carriage), 4 (derogations, special conditions and information) and 10 (assistance by air carriers) also apply to passengers departing from a third country to the EU including Switzerland, if the operating carrier is licensed based on Regulation (EC) No. 1008/2008.
Regulation (EC) No. 80/2009 on a code of conduct for computerised reservation systems also applies in Switzerland.
Insurance and securityInsurance for operators
What mandatory insurance requirements apply to the operation of aircraft?
Regulation (EC) No. 785/2004 (as amended by Regulation (EU) No. 285/2010) establishes minimum insurance requirements for air carriers and aircraft operators. The minimum insurance coverage for liability with respect to passengers is 250,000 SDR per passenger, 1,131 SDR per passenger for liability with respect to baggage and 19 SDR per kilogram for liability with respect to cargo in commercial operations (subject to exceptions for non-commercial operations by aircraft with a maximum take-off weight of 2,700kg or less). In respect of liability for third parties, the minimum insurance cover varies according to the maximum take-off weight of the aircraft concerned.Aviation security
What legal requirements are there with regard to aviation security?
Annex 17 to the Chicago Convention and Regulation (EC) No. 300/2008 on civil aviation security apply in Switzerland. The main objective is to establish and implement measures to prevent acts of unlawful interference against civil aviation. The basic standards for protecting civil aviation cover:
- airport security;
- aircraft security;
- demarcated areas of airports;
- passengers and cabin baggage;
- hold baggage;
- cargo and mail;
- air carrier mail and air carrier materials;
- in-flight and airport supplies;
- in-flight security measures;
- staff recruitment and training; and
- security equipment.
There are, in addition, detailed Swiss national laws and regulations with regard to security issues.Serious crimes
What serious crimes exist with regard to aviation?
Switzerland implemented the provisions of the 1963 Tokyo Convention on Offences and Certain Other Acts Committed on Board Aircraft, the 1970 Hague Convention for the Suppression of Unlawful Seizure of Aircraft and the 1971 Montreal Convention for the Suppression on Unlawful Acts. The Swiss Federal Aviation Act contains a number of aviation-related sanctions, including the endangering of life and property by disregarding air traffic rules. The Swiss Penal Code, however, contains sanctions for most serious aviation-related crimes, for example aircraft hijacking, hostage-taking, serious interference with public traffic, causing an explosion and endangering life or property by using explosives or toxins.
Update and trendsEmerging trends
Are there any emerging trends or hot topics in air transport regulation in your jurisdiction?Emerging trends46 Are there any emerging trends or hot topics in air transport regulation in your jurisdiction?
Air traffic controller and pilot organisations have criticised recent air traffic controller convictions handed down by Swiss criminal courts for operational incidents that resulted in neither injury nor damage. Critics have asserted that criminal prosecutions in the aviation sector tend to do more harm than good and that the sole purpose of safety investigations following aviation incidents is to determine what went wrong in order to use this information to prevent similar incidents happening in future. Most incidents involve some sort of human error and criminal prosecutions seek to determine who is responsible and punish them accordingly. However, this is contrary to the aims of safety investigations, including learning from past mistakes. There is widespread concern that criminalisation leads to a loss of cooperation from individuals who could provide critical insight into an incident.