Collective Redress & Class Actions 2024 Comparisons

Historically, Swiss law follows the concept of individual rights and the individual enforcement of those rights. Accordingly, plaintiffs engage directly in legal proceedings, initiate actions in their own names and defend their personal interests without reliance on any other party to the proceedings. Thus, when numerous individuals suffer similar or identical harm, it is in principle incumbent upon each person to independently pursue their claims in court.

Despite the long-standing debate over collective redress or class actions in Switzerland, such mechanisms are markedly alien to Swiss law and viewed as potentially prone to abuse, particularly in view of the contingency fees (prohibited under Swiss law) that often come along with such collective redress mechanisms. Therefore, the Swiss legislator notably opted in 2006 not to incorporate the Anglo-American class action concept into the Swiss Code of Civil Procedure (SCCP) – which came into force on 1 January 2011 ‒ and decided against including collective action instruments in the Federal Act on Financial Services (“FinSA”), even though such redress had been suggested in the draft bill.

Current Legal Framework

Currently, Swiss law only provides limited and fragmented instruments to allow collective interests to act jointly.

Under Swiss civil procedure law, individuals can seek to collectively enforce their interests through civil litigation ‒  if certain conditions are fulfilled and to a limited extent only ‒ through the joinder of parties (Articles 70 and 71 of the SCCP), the combination of actions in proceedings (Article 90 of the SCCP), or the general right of action for associations or organisations of regional or national importance (Article 89 of the SCCP).

In addition to the general right of action for organisations, there are special rights of action for organisations. These are dispersed in various laws, such as the Federal Act on Gender Equality (GEA), the Federal Act on Unfair Competition (UCA), the Swiss Code of Obligations (SCO), or the Federal Act on the Protection of Trade Marks and Indications of Source (“TmPA”).

Furthermore, in certain sectors and in certain special laws, Swiss law provides for instruments that lead to the collective satisfaction of rights through a representative, with effects comparable to those of a group action – for instance, in the fields of collective investments schemes, mergers and transformations, or debt enforcement and bankruptcy.

Policy Drivers for Change and Initial Proposals

In 2013, the Swiss Federal Council published a report regarding the collective exercise of rights in Switzerland. It highlighted the inadequacies of existing procedural tools in effectively addressing mass or dispersed damages, as the high costs and complexities of individual litigation often deterred people from pursuing their individual claims. The report thus acknowledged the need to enhance procedural protection and the access to justice for consumers, financial investors, and other groups affected by mass harm. Notably, collective redress mechanisms were considered as a means of improving the efficiency of the judicial system by consolidating numerous similar claims into a single procedure, thereby reducing the burden on courts and litigants. The report also compared Swiss practices with those of other countries, noting that many European countries had more developed collective legal protection systems.

A parliamentary motion in 2013 mandated the Swiss Federal Council to explore the implementation of collective redress mechanisms. Initially, the latter had considered the introduction of collective redress mechanisms on a sectoral basis and proposed developing the protection of collective interests in the financial and insurance sectors as part of the new FinSA. Its 2014 preliminary draft proposed the creation of a litigation fund and the possibility of resorting to a collective action or a group settlement procedure. However, strong opposition from various sectors during public consultation led to delays and modifications in the legislative process, and these proposals were left out of the final draft. It was then decided to develop collective redress mechanisms in the SCCP.

Revision of the SCCP (2018–24)

As part of the reform of the SCCP, the Federal Council submitted a preliminary draft bill, which included the strengthening of collective redress mechanisms. However, in response to critical feedback, the Federal Council decided in 2020 to make the provisions concerning the collective enforcement of rights a distinct project.

In December 2021, the Federal Council released a separate draft bill on the right of action for organisations and collective transactions, which aims to further develop collective legal protection mechanisms (FF 2021 3049). Specifically, it introduces a collective settlement procedure and extends the scope of association claims to include all forms of unlawful violations, beyond just personality rights – allowing for a collective compensatory claim process. In conjunction with this proposal, a report was commissioned to examine its regulatory impact, along with a comparative law study. The Swiss model seeks to integrate best practices from other jurisdictions, drawing inspiration from the EU’s Directive 2020/1828 on representative actions for consumer protection, while preserving the core principles of the Swiss legal system.

As of 2024, the Swiss Parliament has still not discussed the proposed legislation. Various committees are assessing its impact and conducting comparative studies to ensure the new mechanisms are effective and do not result in misuse. On 12 April 2024, the Legal Affairs Committee of the National Council decided to postpone the start of discussions again. It notably requested a study on the possible consequences of the ECHR ruling Verein KlimaSeniorinnen Schweiz v Switzerland on the exercise of collective rights in relation to Switzerland’s climate obligations.         

Switzerland’s regime for the collective exercise of rights does not rely on broad collective redress mechanisms or a class action akin to the American model and is not directly modelled on any single country’s regime.

Swiss (private) law emphasises individual rights and procedural fairness, which has historically made it cautious about adopting broad collective mechanisms. The Swiss legislator has consciously avoided adopting many of the US class action components, such as the opt-out mechanism, punitive damages, jury trials, and contingency fees, which are considered alien to Swiss – and more generally European – legal tradition.

Instead, Swiss law employs selected collective redress instruments dispersed in various laws, such as the joinder of parties, the combination of actions, association claims, and other instruments with effects similar to those of collective action. These mechanisms are not directly modelled on any single country’s regime but exist in a similar form ‒ with a few differences ‒ in other foreign legal systems comparable to Swiss law, particularly in European countries.

It should nevertheless be noted that the collective redress mechanisms proposed by the Federal Council in 2021 in the context of the revision of the SCCP are inspired by the best practices existing in other jurisdictions, such as the Dutch Act on Class Settlement of Mass Damages (Wet Collectieve Afwikkeling Massaschade, or WCAM) for the collective settlement procedure and the EU’s Directive 2020/1828 on representative actions for consumer protection.

This is not applicable to Switzerland.

As mentioned in 1.1 History and Policy Drivers of the Legislative Regime, the Swiss legal system has no general collective group action and instead relies on instruments that are dispersed in various laws and that permit ‒ to a certain extent ‒ a degree of collectivisation of collectively enforcing individual rights through litigation. These instruments are found in various laws, including the SCCP, the SCO, the UCA, the Federal Act on Collective Investment Schemes (CISA), or the Federal Act on Debt Enforcement and Bankruptcy (DEBA).

Joinder of Parties

Under Swiss civil procedure law, collective interests can notably be protected through the joinder of parties if certain conditions are fulfilled (Articles 70 and 71 of the SCCP). Joinder allows several claims, which are legally independent but based on similar facts or legal grounds, to be brought together in the same lawsuit by several plaintiffs or against defendants. Joinder can be either compulsory or simple.

Compulsory joinder is required by the relevant substantive law when several individuals or entities are involved in a legal relationship that necessitates a binding decision for all parties involved – for example, disputes involving a community of heirs or in certain bankruptcy situations (Article 70 of the SCCP). In such cases, the parties involved must sue or be sued together.

Simple joinder is a voluntary process, typically pursued for efficiency when certain conditions are met (Article 71 of the SCCP). In such instances, parties may collectively initiate or face a lawsuit. Despite being part of joint proceedings, each party remains independent, meaning that the judgment can vary for each individual involved. Each litigant maintains autonomy and can manage their dispute without being influenced by the actions of other parties. Simple joinder is applicable if three criteria are satisfied:

• first, the claims must be based on similar facts or legal grounds;
• second, they must follow the same procedural type (ordinary, simplified, or summary); and
• third, they must fall under the same substantive and territorial jurisdiction.

Combination of Actions

Under certain conditions, a plaintiff may also combine several claims that are procedurally independent of each other in a single action against the same defendant (Article 90 of the SCCP). The same type of procedure must be applicable to the claims and the same substantive jurisdiction must be given. This procedural mechanism could theoretically be used to assert collective damages if numerous claims are assigned to the same plaintiff, but this model has not had any practical importance, especially because of the high procedural costs incurred.

Bifurcation of Proceedings, Stay of Proceedings and Transfer of Connected Cases

The possibility of joining cases and suspending proceedings, in conjunction with the possibility of the combination of actions and the joinder of parties, can be used to exercise rights collectively. Furthermore, the three options of joining cases, staying proceedings and transferring proceedings enable a court to hear several proceedings in the interests of procedural economy and in order to avoid contradictory decisions.

Under Article 125(c) of the SCCP, the court may order the joinder of several cases where this would simplify the proceedings if the cases in question fall within the same territorial jurisdiction, if they involve the same type of proceedings, and if they are similar with regard to the facts and questions of law to be decided. In this way, where several plaintiffs have filed similar suits against the same defendant, the court may decide to hear all the suits together.

Article 126(1) of the SCCP allows the court to suspend proceedings where this is necessary for reasons of expediency, particularly where the decision depends on the outcome of another case.

Furthermore, Article 127(1) of the SCCP provides that, if several related actions are brought before different courts, any court seised subsequently may transfer the action to the court first seised (with the latter’s agreement).

General Right of Action for Associations

Article 89 of the SCCP permits associations and other organisations of national or regional importance to bring actions in their own name against violations of the personality rights of their members, if the organisation is empowered under its articles to defend the interests of a specific group of people.

This mechanism is, however, limited in scope and does not allow for monetary damages. Under Article 89 of the SCCP, any claim for compensation is excluded, as organisations can only seek an injunction, a cessation of the disturbance, or a finding that the disturbance is unlawful. To date, Article 89 of the SCCP has thus been of little practical significance.

Special Rights of Action for Organisations

In addition to the general right of action for organisations provided for in Article 89 of the SCCP, there are special rights of action for organisations, which are dispersed in various laws and which may be more or less restrictive than the rule set out in Article 89 of the SCCP.

Notably, Article 7(1) of the GEA grants organisations that have existed for at least two years and aim, under their articles of incorporation, to promote gender equality or defend workers’ interests to bring an action in their own name for a finding of discrimination (including gender pay gaps and other forms of unequal treatment) if the outcome is likely to impact a considerable number of employment relationships. These associations benefit from certain procedural facilities (free of charge, ex officio rule, simplification of evidence).

In matters of unfair competition, Article 10(2) of the UCA permits professional and trade associations that are authorised under their articles to safeguard the economic interests of their members – as well as organisations of national or regional importance that, in accordance with their articles, are dedicated to consumer protection – to bring action if there is a threat or a damage sustained to customer bases, credit or professional reputation, business operations or economic interests due to an act of unfair competition. Associations may only seek prohibition, cessation or recognition of the unlawfulness of unfair conduct, and the members must then each assert their individual financial claims.

Furthermore, professional and economic associations, consumer protection organisations, employers’ and employees’ associations, and certain associations for the disabled have various rights of action under Swiss law.

According to Article 56(1) of the TmPA in conjunction with Articles 52 and 55 of the TmPA, professional and trade associations authorised by their statutes to safeguard the economic interests of their members – as well as organisations of national or regional importance dedicated by their articles to the protection of consumers – can initiate proceedings for declarations, cessation, prohibition, or requests for information related to indications of source, guarantee marks, or collective marks.

Under Article 15(2) of the Participation Act, employers’ and employees’ associations can also bring actions to establish infringements of the Act’s provisions.

Additionally, Article 357b of the SCO enables the contracting parties to stipulate, in such a contract, a right to take joint action directly against bound employers and employees to ensure compliance with the clauses of the collective employment contract ‒ particularly regarding the formation, the nature, and the termination of employment relationships.

Finally, in cases of discrimination affecting a substantial number of persons with disabilities, Article 9 of the Disability Discrimination Act (DDA) grants organisations for persons with disabilities – operating throughout Switzerland and established for at least ten years – the right to appeal and take action to find discrimination in civil proceedings as specified in paragraph 3(a) of this provision.

Test Cases

Current Swiss law lacks specific statutory provisions on test actions, which formally do not exist as such. However, it can practically be contemplated with a test claim going first. A test case allows for the protection of collective interests by initially conducting a single representative “model procedure” between two parties over a specific matter in dispute. The decision made in this model case serves as a procedural reference regarding particular factual or legal questions for subsequent disputes among other parties, thus avoiding the need to readdress the same disputed issue. Conceptually, the model action is an individual action by the model plaintiff, aiming for the resolution of factual or legal questions in the model procedure to have a broad impact on multiple cases.

There is, however, no procedural guarantee that will be given to other cases based on that purported test case. In particular, other claims may have to be filed pending the test case without assurance to be suspended pending the outcome of the test case. Furthermore, each claim will eventually be ruled upon individually without any binding effect of the test case’s outcome on the other cases (although, in practice and provided the cases are indeed similar and pending before the same court, it is very likely that the test case will impact the subsequent cases).

Sectoral Laws – Group Action

Even though the Swiss legal system does not provide for a general collective legal action, it does include instruments that are governed by specific laws and which produce collective satisfaction of rights through a representative, with effects comparable to those of a collective legal action.

Specifically, the CISA – which regulates the distribution of foreign collective investment schemes in Switzerland – provides for a collective framework for investors seeking reimbursement for unlawfully withheld entitlements or benefits (Articles 85 and 86 of the CISA). This type of collective action is only feasible within “open-ended” collective investment schemes, such as contractual funds or investment companies with variable capital. The defendant is the person or entity responsible for the damages; however, proceedings can only be conducted for the benefit of the investment fund, making the fund the direct beneficiary while investors benefit indirectly. A court-appointed representative holds the same procedural rights as the investors. If the representative files an action for restitution under Article 85 of the CISA, individual investors are prevented from filing a similar claim.

Additionally, a judgment secured by the representative is binding on all investors, meaning there is no need for individuals to opt in or the possibility to opt out. Furthermore, the representative’s costs are generally borne by the collective assets, deviating from the Swiss legal principle according to which the loser pays all the costs. It is worth noting that, to date, this action has had little to no practical significance.

In the sector of bond loans, creditors automatically form a community of creditors under Article 1157(1) of the SCO. This community is not a legal entity but possesses the capacity to initiate legal proceedings. The representative of this community, determined either by the loan’s terms or elected during a creditors’ meeting, can enforce the creditors’ rights if empowered to do so by the meeting. This prevents individual creditors from independently exercising their rights. Thus, this mechanism resembles a class action – enabling collective defence and the pursuit of creditors’ rights through a single proceeding led by a common representative, with the judgment applicable to all creditors.

Nonetheless, according to the Swiss Federal Supreme Court, this action is intended to defend common interests and address indirect damages suffered by bond creditors. It does not cover direct damages, such as those due to liability under Article 752 of the SCO. Given that unanimity among creditors is generally required to empower the representative, this effectively creates an opt-in group action: either all creditors agree to a group action or no group action occurs.

Furthermore, Article 260 of the DEBA allows any creditor to ask the bankruptcy estate to assign a claim that the estate has waived and pay itself in priority from any proceeds. This is not an assignment within the meaning of civil law; the creditor simply obtains the right to assert the rights of the estate in court and a preferential right of satisfaction in order to encourage the creditor to act. The creditor therefore acts based on a procedural mandate, in their own name, but also on behalf of the other creditors. Thus, any decision (or transaction) relating to claims is binding not only on the acting creditor and their adversary, but also on the other creditors and the bankruptcy estate. Although the acting creditor also asserts the rights of the other creditors and a decision in this respect binds each individual creditor (who is not necessarily known), it is not strictly speaking a collective action aimed at satisfying individual rights.

Finally, under Article 105 of the Federal Act on Mergers, Demergers, Transformations and Transfers of Assets and Liabilities (“MergA”), if – at the time of a merger, demerger or transformation – the shares or membership rights are not adequately maintained or if the compensation is inadequate, each shareholder may demand, within two months of publication of the merger, demerger or transformation decision, that the court set an adequate compensation payment. The ruling applies to all the shareholders of the participating company, provided that they have the same legal status as the plaintiff, without these other shareholders having any real possibility of opting out in order to protect themselves against this effect.

Consumer Protection and Competition Law

Article 10(2) of the UCA allows authorised professional and trade associations, as well as organisations devoted to consumer protection, to seek rulings on unfair or anti-competitive behaviour. Similarly, Article 56 of the TmPA grants associations and organisations the right to pursue actions for declaratory judgment and enforcement regarding the protection of indications of source.

Collective Labour Rights and Protection Against Discrimination

Article 357b of the SCO allows for collective enforcement of individual claims from collective agreements concerning employment contracts – although only declaratory actions are permitted. Under Article 15(2) of the Participation Act, employers’ and employees’ associations are entitled to bring an action for a declaration that the Act has been infringed.

Furthermore, Article 7(1) of the GEA permits organisations aiming to promote gender equality or defend workers’ interests to bring an action in their own name for a finding of discrimination in the workplace.

Finally, Article 9(1) of the DDA provides for a right of appeal and a right of action for certain organisations in cases of discrimination affecting a substantial number of persons with disabilities.

Collective Investment Schemes

According to Articles 85 and 86 of the CISA, if the open-ended collective investment scheme is unlawfully denied asset entitlements or if benefits are withheld from it, the investors wishing to pursue a claim for damages in favour of the open-ended collective investment scheme concerned may request that the court appoint a representative, who will have the same procedural rights as the investors.

Debt Enforcement and Bankruptcy

Article 260 of the DEBA allows a creditor to ask the bankruptcy estate to assign to the creditor the right to enforce the rights of the estate in court and, in exchange, to obtain priority payment from the proceeds of the sale. Although the creditor in question also asserts the rights of the other creditors and a decision in this respect is binding on each creditor, the assignee creditor acts in their own name – based on a procedural mandate – so this is not strictly speaking a collective action to satisfy individual rights.

Bond Loans

According to Articles 1157 et seq of the SCO, creditors automatically form – by law – a community of creditors, which has the capacity to take legal action. Thus, the representative of the community of creditors may assert the rights of the creditors if the representative has received the power to do so from the meeting of creditors, which at the same time excludes the creditors from exercising their rights independently. This instrument is similar to a collective action, allowing the collective defence and satisfaction of creditors’ rights in a single procedure by a common representative, with a judgment enforceable against all creditors. However, it is only possible for the representative to claim damages indirectly suffered by the creditors.

Mergers, Demergers, Transformations and Transfers of Assets

Article 105 of the MergA states that if shares or rights are inadequately maintained during a merger, demerger, or transformation, each shareholder can ask the court to set fair compensation within two months of the publication of the decision. This ruling applies to all similar shareholders, with no opt-out option.

General Civil Claims

In addition to the areas previously mentioned, the SCCP encompasses procedural instruments that facilitate a degree of collective legal protection within individual actions, such as the joinder of parties (Articles 70 and 71 of the SCCP), the cumulation of actions (Article 90 of the SCCP), the bifurcation of proceedings (Article 125(c) of the SCCP), or the general right of action for associations (Article 89 of the SCCP). Provided that the specific conditions for each instrument are fulfilled, they may generally apply to all private law disputes. Only the right of action for associations is limited in scope to violations of the personality rights of their members.

For more details on each instrument, see 2.1 Collective Redress and Class Action Legislation.

Given that there is no collective redress/class action in Swiss law, there is no statutory definition. Nevertheless, there are several statutory provisions and interpretations that provide a framework for collective redress in Switzerland (see 2.1 Collective Redress and Class Action Legislation).

In its report on the collective exercise of rights in Switzerland, the Federal Council broadly defined the concept as procedural tools that facilitate the collective judicial resolution of claims from numerous individuals affected in a similar or identical manner, by pooling their interests and resources in a single common procedure or a limited number thereof. In general, class actions are representative actions whereby individual claims are grouped together by the fact that a plaintiff in the class acts on behalf of others who are not formally parties to the proceedings but who nevertheless share in the outcome, owing to the res judicata effect on their claims.

The collective exercise of rights aims to enforce the law more efficiently and effectively than individual actions by collectivising interests and resources, especially when numerous claims arise from similar facts against a single defendant or a few defendants. Its objectives include procedural economy, compensation, prevention of unlawful conduct, and the effective enforcement of objective law.

The notion of collective exercise of rights must therefore be considered in opposition to that of individual exercise of rights. A distinction must further be made between instruments that serve the collective exercise of rights and those which achieve a degree of collectivisation through individual actions – although academic interpretations of these instruments can vary significantly. Some instruments, depending on their configuration, can be used for either collective enforcement or collectivised individual rights (eg, actions by organisations or test case procedures).

In Switzerland, the mechanisms for bringing a collective redress suit are relatively limited and dispersed. Whereas some instruments are found in special laws and therefore apply only to certain areas of law, others are provided for in the SCCP and can thus be used for any private law dispute, provided that certain conditions are fulfilled. Such instruments are detailed as follows (also see 2.1 Collective Redress and Class Action Legislation).

Joinder of Parties

Joinder allows several claims, which are legally independent but based on similar facts or legal grounds, to be brought together in the same lawsuit by several plaintiffs or defendants before the competent civil court under certain conditions.

Compulsory joinder is necessary when multiple individuals or entities are part of a legal relationship that requires a conclusive decision affecting all parties, with substantive law outlining the conditions for compulsory joinder (Article 70 of the SCCP). Simple, voluntary joinder is permissible when claims are founded on similar facts or legal principles, share the same procedural type, and fall within the same substantive and territorial jurisdiction. Each litigant remains an independent party to the proceedings and operates autonomously (Article 71 of the SCCP).

Combination of Actions

A plaintiff may also combine multiple claims, which are procedurally distinct, in one lawsuit against a single defendant before the competent civil court, as long as the same procedural rules and substantive jurisdiction are applicable to all the claims (Article 90 of the SCCP).

General Right of Action for Associations

The mechanism outlined in Article 89 of the SCCP permits associations and organisations of national or regional significance to file a lawsuit in their own name for violations of the personality rights of their members. The association must specifically be authorised, under its articles, to protect the interests of a certain group of individuals. Under the current legal framework, such associations cannot seek monetary damages; instead, they are limited to obtaining remedies that prohibit imminent violations, cease ongoing violations, or determine the unlawful nature of a violation. Since its implementation on 1 January 2011, Article 89 of the SCCP has seen minimal practical application. However, the 2021 draft bill on actions for organisations and collective settlements seeks to expand its scope to cover any type of breach of private law – not just those related to personality rights – and would allow for claims including monetary damages if adopted by Parliament.

Special Rights of Action for Organisations

Certain specific statutes such as the UCA and the TmPA provide for a special right of action for associations, which can file claims in their own name on behalf of their members under certain conditions set out in the relevant provisions before the ordinary civil court or before the commercial court (ie, sole cantonal instances in accordance with Articles 5(1) and 6 of the SCCP) if cantonal law provides for such a court. These claims are, however, limited to non-monetary remedies (eg, prohibiting unfair practices or violations).

Claim for Reimbursement by Representative of Investors in Favour of Open-Ended Collective Investment Scheme

In accordance with Articles 85 and 86 of the CISA, if the open-ended collective investment scheme is unlawfully denied asset entitlements or if benefits are withheld from it, the investors wishing to pursue a claim for damages in favour of the open-ended collective investment scheme concerned may request that the court appoint a representative, who will have the same procedural rights as the investors. All investors will be bound by the judgment obtained by the representative without any real possibility of opting out. However, this provision has little practical significance.

Assignment of Creditors’ Rights to Bankruptcy Estate

Under Article 260 of the DEBA, any creditor may request the bankruptcy estate to assign a claim that the estate has renounced and secure priority payment from any resulting proceeds. The creditor obtains the right to pursue the rights of the estate before the civil court having jurisdiction over the subject matter of the right to be asserted.

Insofar as the Swiss legal system does not have a general collective redress mechanism, the various instruments for the collective enforcement of rights are subject to the overall procedure of the SCCP. Notably, the SCCP outlines different types of procedures to handle various civil disputes – namely, the ordinary, simplified, and summary proceedings.

Ordinary proceedings (Articles 219 et seq of the SCCP) are the standard procedures for civil cases that do not fall under any special category. An ordinary proceeding involves a detailed process, including a conciliation proceeding or a mediation attempt (with some exceptions), exchange of written submissions, optional instruction hearing, the main hearing encompassing the taking of evidence and the final pleadings of the parties, as well as the decision by the court.

Simplified proceedings (Articles 243 et seq of the SCCP) are used for cases involving smaller amounts of money, up to CHF30,000, or – regardless of the amount in dispute – for cases specifically provided for by the SCCP, such as disputes under the GEA and the Participation Act. They are designed to be faster and less formal than ordinary proceedings. The court has more discretion to simplify the process, such as by reducing the number of written submissions and hearings.

As for the summary procedure (Articles 248 et seq of the SCCP), it applies in principle to cases listed by law and particularly to cases under the DEBA. The procedure is highly simplified, with limited opportunities to present evidence and fewer procedural steps.

It should also be noted that federal law requires that, in principle, each canton provides two levels of civil jurisdiction (ie, a first-instance court and an appellate court) before the appeal to the Swiss Federal Court. However, Article 5(1) of the SCCP lists several areas where cantons are allowed to instate one single cantonal instance, such as disputes under the UCA, disputes in connection with IP rights, or disputes under the CISA. According to Article 243(3) of the SCCP, the simplified proceedings do not apply to disputes before the court of sole cantonal instance within the meaning of Article 5(1) of the SCCP or before a Commercial Court in accordance with Article 6 of the SCCP.

General and Special Rights of Action for Associations and Organisations

Article 89 of the SCCP, as well as various special laws such as the GEA, the UCA, and the TmPA, grant varying rights of action to certain associations and organisations under specific conditions (see 2.1 Collective Redress and Class Action Legislation).

Group Action

As previously explained, certain special laws provide for class action mechanisms with a limited scope of application and specify the persons or entities who are entitled to bring a class action. By way of example, under Articles 85 and 86 of the CISA, a court-appointed investor representative may bring a claim on behalf of the open-ended collective investment scheme. Article 260 of the DEBA allows a creditor to be assigned claims that the bankruptcy estate has waived in order to assert the corresponding rights of the estate in court (see 2.1 Collective Redress and Class Action Legislation).

General Instruments Under the SCCP

If certain conditions are fulfilled, it is the parties to civil proceedings who have standing to rely on a joinder of parties within the meaning of Articles 70 and 71 of the SCCP or on a combination of actions in accordance with Article 90 of the SCCP (see 2.1 Collective Redress and Class Action Legislation).

As the Swiss legal system lacks a comprehensive class action mechanism, there are no established classes or rules determining class membership. Litigation is conducted by individual plaintiffs, in principle.

Nevertheless, there are mechanisms where the judgment is binding to a group of individuals with no real possibility for them to opt out, which is the case for the actions under Article 260 of the DEBA, Article 105 of the MergA, and Article 86 of the CISA. As for the action of the community of creditors of a bond loan within the meaning of Articles 1157 et seq of the SCO, it is an instrument similar to an opt-in collective action – given that there is either a group action for all the creditors of the loan with the agreement of all of them or there is no group action at all (see 2.1 Collective Redress and Class Action Legislation).

Given that Swiss law does not provide for collective redress mechanisms, there are no rules for joining further parties to such actions (see 2.1 Collective Redress and Class Action Legislation and 4.4 Class Members, Size and Mechanism – Opting In or Out).

General Rules on Third-Party Joinders

The general rules of the SCCP provide for several instruments for third-party joinders to ensure that all parties with a legal interest in the outcome of a case can participate in the proceedings.

In particular, Articles 73 et seq of the SCCP allow a third party to intervene in ongoing proceedings if they have a legal interest in the outcome, either to assert their own claims (“principal intervention”) (Article 73 of the SCCP) or to support the claims of one of the existing parties (“accessory intervention”) (Articles 74 et seq of the SCCP).

By a “third party notice” within the meaning of Articles 78 et seq of the SCCP, one of the parties involved in a lawsuit may notify a third party if they believe that the third party might have a claim against them or might be liable to them if the lawsuit is unsuccessful. Upon notification, the third party is allowed to join the proceedings.

Furthermore, according to Articles 81 et seq of the SCCP, if a third party is notified and decides to join the proceedings, they can bring their own claims against one of the existing parties (“third-party action”).

Bifurcation of Proceedings

According to Article 125(c) of the SCCP, when it seems appropriate to simplify the proceedings, Swiss civil courts may order the joinder of separately filed actions if they have the same object and if they are subject to the same type of procedure. This power helps streamline proceedings and reduce the risk of inconsistent judgments.

Beside, upon request, the judge can also order a bifurcation of the proceeding should that simplify its outcome. Typically, such bifurcation may be ordered when preliminary procedural issues are to be dealt with or if specific issue(s) on the merits may lead to ending the case without having to hear it in its entirety.

Stay of Proceedings

Under Article 126(1) of the SCCP, courts may stay proceedings, if necessary – ie, particularly when the outcome depends on another ongoing case in order to ensure that related cases are resolved consistently, or when there are ongoing settlement negotiations. It should be noted that there are also cases where the law itself provides for the stay of proceedings by operation of law or where the judge may order such a stay.

In Switzerland, the average duration of civil proceedings can vary based on factors such as the complexity of the case, the court involved, the co-operation of the parties involved, the type of procedure applicable to the dispute, and potential procedural hurdles. Typically, Swiss civil cases may take anywhere from several months to a few years to resolve. Complex cases, particularly those involving extensive evidence gathering or numerous expert witnesses, may prolong the initial proceedings. Furthermore, first-instance judgments are subject to appeal – potentially reaching the Federal Supreme Court – in accordance with the general rules of procedure. In such instances, it may take several years for a final and binding judgement to be rendered.

Summary proceedings are organised in a flexible and expeditious manner, with the judge having a wide margin of discretion to organise them. They differ mainly from the ordinary and simplified proceedings in that the means of proof are restricted. Articles 248 et seq of the SCCP define its scope and list the different areas of application of summary proceedings – notably, clear-cut cases, interim measures, and the numerous cases provided for by federal law, including specific actions under the DEBA.

Moreover, simplified proceedings apply to disputes with a value up to CHF30,000 or to specific types of cases, regardless of the amount in dispute (Article 243 of the SCCP). This type of proceeding is supposed to be less formal than ordinary proceedings, with more emphasis on oral arguments and judicial involvement, but these principles may be relativised if the parties to the proceedings are represented by lawyers.

Conversely and as explained in 4.7 Length and Timetable for Proceedings, proceedings can be delayed or suspended if there are valid reasons, such as ongoing settlement negotiations or related cases pending in other courts.

In Switzerland, the general rule for costs in civil proceedings is that the losing party must pay the court fees as well as its own legal fees and compensate the prevailing party for its legal fees. If neither party prevails entirely, the fees are split between the parties in accordance with the outcome of the proceeding. In exceptional cases, the court has the discretion to deviate from these rules and allocate the costs differently.

The court might require the plaintiff to provide an advance payment covering the anticipated court costs, with a limit of up to half the estimated expenses starting from 1 January 2025. Generally, these costs are proportional to the value of the claim.

Third-party funding is a common method for financing collective redress actions. This involves a third-party financier covering the legal costs in exchange for a portion of the awarded damages or settlement. This is particularly relevant given the prohibition on contingency fees (pactum de quota litis) in Switzerland, which restricts attorneys from entering into agreements where their fees are contingent on the outcome of the case. Third party-funding is not regulated in Switzerland and courts, including the Swiss Supreme Court, have shown significant tolerance to third party-funding.

Pre-trial Disclosure

Swiss law does not have a broad pre-trial discovery process similar to that of Anglo-American jurisdictions. Instead, it allows for extremely limited pre-trial rights of information and inspection in the general rules of civil procedure or in special laws in order to help a claimant assess whether a claim exists and whether it can be proven. Specifically, Article 158(1) of SCCP permits the precautionary taking of evidence, providing that the court may take evidence at any time if the applicant shows credibly that the evidence is at risk or that it has a legitimate interest.

Swiss courts handle procedural document production rights very restrictively – meaning that, as a practical result, a plaintiff will typically have to fully rely on the evidence in its possession. In certain instances, there are more general information rights under substantive law as well as data protection law. However, with regard to information rights under the Swiss Data Protection Act, there is case law stating that exercising such rights in anticipation of litigation to circumvent the narrow civil procedural document production rights is an abuse of rights.

Trial Disclosure

In Swiss civil proceedings, parties submit their pleadings and documentary evidence during the allegation phase. Each party must present the facts on which they rely and provide the corresponding evidence. The court then examines the evidence presented and hears witnesses as well as expert opinions. Parties are required to co-operate in the taking of evidence.

Rules of Privilege

Communications between a client and their attorney are protected, provided that the communication relates to the attorney’s typical professional activities, such as legal advice and representation. Moreover, lawyers cannot be compelled to testify or produce privileged documents under Swiss law, unless they are released from the professional secrecy by the client. It is worth mentioning that, as of 1 January 2025, the new Article 167a of the SCCP will extend privilege in civil proceedings to in-house counsels under certain conditions.

In the absence of any dedicated collective redress mechanism that would embody its own remedies, all general remedies are possible according to the ordinary proceedings.

Certain sector-specific laws in Switzerland also provide for collective redress mechanisms with specific remedies, such as collective actions to claim reimbursement for the unlawful withholding of entitlements or benefits under Articles 85 and 86 of the CISA, with the investment fund being the direct beneficiary of any successful action (see 2.1 Collective Redress and Class Action Legislation).

For the Swiss forms of collective redress, the same principles apply with regard to settlement and ADR as for individual actions.

Judicial and Extrajudicial Settlements

Parties involved in a dispute can engage in direct negotiations to reach a settlement. Extrajudicial settlements are concluded without a court being involved and, in order to stop the lawsuit, would require the parties to agree to withdraw the claim or to an indefinite stay of proceedings. Judicial settlements are concluded before the court, permissible at every moment during the procedure and immediately enforceable.

Mediation

Mediation is a voluntary process where the parties involved in a dispute agree to seek a resolution with the help of a neutral mediator. Articles 213 et seq of the SCCP deal expressly with the use of mediation in civil proceedings and provide that the court may recommend mediation to the parties at any time and, at the request of the parties, conciliation proceedings may be replaced by mediation. The court proceedings remain suspended until the request for mediation is withdrawn or until the court is notified of the end of the mediation. The parties are responsible for organising as well as conducting the process and they bear the costs of the mediation. Mediation proceedings are confidential. If the parties reach an agreement approved by the court, it has the same effect as a legally binding decision.

Arbitration

The SCCP also allows domestic arbitration as a formal ADR mechanism where the parties agree to submit their dispute to one or more arbitrators who make a binding decision. For international cases, the Swiss Private International Law Act sets forth Switzerland’s arbitration law. Switzerland is among the world’s leading hubs for international arbitrations and remains a particularly arbitration-friendly jurisdiction, including in the context of set-aside proceedings (which must be brought directly to the Swiss Supreme Court and where the likelihood for appellants to succeed is statistically less than 10%), as well as recognition and enforcement of foreign awards (which are routinely enforced).

Arbitration can be faster and more flexible than court proceedings.

In the context of collective redress mechanisms in Switzerland, the nature of the judgment delivered and its binding effect – as well as the mechanisms for enforcement – are shaped by the specific procedural instruments and legal frameworks in place (see 2.1 Collective Redress and Class Action Legislation).

The enforcement of judgments in collective redress mechanisms follows the general principles and procedures outlined in the SCCP for non-monetary claims (Articles 335 et seq of the SCCP) and other relevant laws, such as the DEBA for monetary claims.

The potential enactment of a collective redress mechanism under Swiss law has already been debated on multiple occasions and is a recurring topic.

It is currently being examined again by the Swiss Parliament – although such process has been stayed. No new developments are expected in the near future (for the details, see 1.1 History and Policy Drivers of the Legislative Regime).

The proposed amendments to the SCCP are featured in the draft bill titled “Modification of the Civil Code of Procedure for Collective Actions”, dated 10 December 2021, and include several significant changes aimed at enhancing collective redress mechanisms in civil proceedings.

Expansion of Right of Action for Organisations and Collective Transactions

Article 89 of the SCCP would be revised as follows. Associations and other organisations would be able to act in their own name to assert an infringement of the rights of a specific group of people if they meet the following conditions:

• they are non-profit;
• they have been established for at least 12 months at the time of initiating the action;
• they are authorised to defend the rights and interests of the group according to their articles; and
• they are independent of the parties they accuse of committing an unlawful infringement.

Organisations would be able to ask the court to prohibit an imminent unlawful infringement, cease an ongoing unlawful infringement, or declare the infringement unlawful. The court’s decision could then be communicated to third parties or published.

The drafts of Articles 307c-307f describe the procedure for an action by an organisation and the conditions for admission to the action.

Specifically, the action would be initiated by a request for admission, which must include various information on the dispute (Article 307c). The court would allow the opposing party to respond and decide on the admissibility of the action. If admissible, the court would set a deadline for the organisation to submit its submission. The admission of the action would be published and no other similar actions could be admitted against the same defendant for the same infringement during a specified period. Concerned persons could join the action by authorising the organisation within a minimum three-month period set by the court. Individuals who would have already initiated individual actions could withdraw them to join the collective action (Article 307d).

The court’s decision would bind the parties and the persons who joined the action. If the decision includes compensation, it will specify notably the total amount and the distribution criteria. If the organisation does not act to enforce the decision within 12 months, any concerned person could request enforcement on their behalf (Article 307f).

According to the draft Article 307h, parties to the proceedings could submit a joint request to declare a collective transaction binding for all concerned persons who joined the action. The request could also extend the binding force to all concerned persons domiciled or seated in Switzerland who did not join the action but did not opt out within a specified period, if the individual claim amount is too small to justify an individual action and a significant portion of concerned persons did not join the action. The court would then publish the request and set a reasonable period for concerned persons to respond or opt out. If the court does not approve the transaction, it would allow the parties to reconsider the terms before making a decision (Article 307i).

Under the draft Article 307j, the court would have to approve the transaction if:

• the compensation and its distribution are proportionate to the infringement and damage;
• the minimum number or percentage of persons bound by the transaction is met;
• the transaction is not contrary to mandatory law;
• the cost provisions are fair and not disproportionate; and
• the interests of the concerned persons are appropriately preserved.

The decision approving the transaction would be binding and could not be contested by the concerned persons.

Collective Transactions Without Organisational Action

Pursuant to the draft Article 307k, organisations could also conclude a collective transaction independently of any organisational action and submit a joint request to the court to declare it binding for all concerned persons domiciled or seated in Switzerland who did not opt out within a specified period, if they can initiate an action under Article 89 of the SCCP or a special legal provision, if the claims are based on similar facts or legal grounds, and if the individual claim amount is too small to justify an individual action. The procedure and approval process for such transactions would follow the same rules as those for collective transactions initiated by organisational actions. The court would ensure public access to information about the collective procedures (Article 307l).

The Dieselgate scandal and other ESG-related matters have underscored the necessity for more robust legal frameworks in Switzerland to address mass harm claims. The Dieselgate incident, where Volkswagen falsified emissions tests, revealed the shortcomings of the Swiss legal system – in particular, its lack of efficient collective redress mechanisms such as class actions. Consequently, consumers faced the burden of filing individual lawsuits, which were often impractical owing to high litigation expenses and relatively small individual damages.

So far, however, ESG litigation has remained quite limited in Switzerland. As yet, it does not act as a catalyst to adapt the legal procedural framework in respect of possible class action.