The Legal Framework of Swiss International Trade and Investments

Part I: Promotion

in The Journal of World Investment & Trade
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The Legal Framework of Swiss International Trade and Investments

Part I: Promotion

in The Journal of World Investment & Trade


With imports of US$ 144 billion and exports of US$ 175 billion in goods and commercial services. See International Trade Statistia 2005, WTO, Tables 1.5, 1.7 and 1.9. 7.46 million in December 2005, of which 1.64 million, or 21.9 per cent, were foreigners in 2004. See the Website of the Federal Office of Statistics at . 3 With US$ 4.478 billion and US$ 25.207 billion, respectively. See World Investment Report 2005, Annex Table B.2, United Nations Conference on Trade and Development. It It represented 109.8 per cent of Swiss GDP; id., Annex Tables B.2-3. with the total amounts of inbound and outbound FIJI stocks were US$ 181.033 billion and US$ 393.019 billion, respectively. As for the latter, Switzerland ranked quite remarkably ahead of Italy, Canada and Japan. 5 International trade can be understood as involving only the movement of goods and services across national borders. Trade in services also covers transactions that involve the cross-border movement of factors of production (capital and labour). See . See also General Agreement on Trade in Services (GATS), Article 1(2). 6 The International Monetary Fund (IMF) defines Fdi as an investment made to acquire lasting interest in enterprises operating outside of the economy of the investor. Further, the investor's purpose is to gain an effective

voice in the management of the enterprise. See Balarrce of Payments Manual: Fifth Editioti (BI'.H5), IMF (Washington, D.C. 1993). See also Detailed Benchmark Definition offoreiqii Direct Investment: Third Edition (BD3), Organisation for Economic Co-operation and Development (OECD) (Paris 1996) (summarized at See Convention on the Settlement of Investment Disputes Between States and Nationals of Other States of 18 March 1965, Article 25(1). See also Report of the Executive Directors on the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, BERD, para. 27 (18 March 1965). 7 There are three main areas of work in the WTO on trade and investment: (i) a Working Group established at the 1996 WTO Ministerial Conference in Singapore conducts analytical work on the relationship between trade and investment; (ii) the Agreement on Trade-Related Investment Measures (Trims) (see infra IV.C.2.(d), "The Agreement on Trade-Related Investment Measures"); and (iii) the General Agreement on Trade in Services (GATS), which addresses foreign investment in services as one of four modes of supply of services (see infra IV.C.2.(b), "The General Agreement on Trade in Services"). The relationship between trade and investment was dropped from the Doha agenda on 1 August 2004, however (see infra note 126). The European Free Trade Agreement's Is (EFTA) 40th Anniversary Declaration expressly addressed the possibility of extending trade agreements to both investments and services (see infra IV.B.2.(c), "The 40th Anniversary Declaration". ,See also infra note 96). 8 In 2005, Switzerland's foreign aid reached CHF 1.9 billion, or 0.41 per cent of the country's GDP. 9 Swiss Federal Constitution (Cst) Article 101 (1), Recueil systématique des loisfédérales (RS) 101. 10 Id., Article 54(1). Ir See Loi federale sur les mesures ccononziques exterieures, Article 10, RS 946.201 (25 June 1982). The latest report is the 2005 report; See CC)NSEIL federal, RAPPORT SUR LA POLITIQUE economique EXTÉRIEURE 2005, FF 2006 p. 1635 (11 January 2006). See also Wto, Trade Policy Review Reports by Switzerland and Liechtenstein, WT/TPR/G/141 (17 November 2004). For an elaborated account of the legal basis of the Swiss external economic policy, see . aussenwirtschafi:/ grundlagen/ index.htuù?lang=&&PHPSESSID= 073CF171CFcdfc250987f3357e5O655d,.

12See CC)NSEIL FEDERAL, RAPPORT SUR LA POLITIQUE TCONOMIQUE exterieure 2004, FF 2005 p. 993 (12 Janu,lry 2005). See also seco, Nouvelle strategie pour la yolitique economique exterieure de la Suisse (communiqué) (January 2005). '3 Loi federale sur la promotion des exportations, RS 946.14 (6 October 2000, entered into force on 1 March 2001). See also CONSEIL federal, MESSAGE CONCERNANT LA LOI FEDERALE SUR LA PROMOTION DES EXPORTATION, FF 2000 p. 2002 (23 February 2000). On the criticisms prompted by the defective implementation of this Act, see infra III, "The Internal Actors". t4 Cst, Article 54(2), RS 101. See CONSEIL FEDERAL, RAPPORi' SUR LA POLITIQUE EXTÉR1EURE 2000, Presence E1' cooperation: LA SAUVEGARDE DES INTERETS DANS UN MONDE EN COURS IJ1Nl'É<;RATION (15 November 2000). See See . The relationship between MOFA and MOE is defined in a framework agreement Cited !ii CONTROLS FEDERAL DES FINANCES, POLITIC2UE FEDERAL DE YRC)MOTION DES EXPORTATIONS, EVALUATION DES COUNTS ET DE LA COORDINATION ENTRE LES ACTEURS (january 2005) at 40. '" Other related institutions worth mentioning include the Export Risks Guarantee and the Investment Risks Guarantee schemes, both of which will be addressed in the second part of this article, on the protection of exports and investments, as well as the Export Aid to Transformed Agricultural Products scheme of the Federal Customs Administration (ApD). Also known as Business Network Switzerland. Founded in 1927, OSEC is a non-profit organization and has been mandated by the Swiss government to support Swiss companies abroad. It coordinates a network of 13 representative offices or "hubs" worldwide which deliver modestly priced information, consulting and marketing services. OSEC is subordinated to seco under a Service Agreement. However, the 1 hubs hosted by an embassy or consulate are subordinated to MOFA. See . 20 Created in 1997 by seco to facilitate investments in countries with developing and transition economies. The Swiss government operates SOFI in collaboration with KPMG. See ��. zt Other State-controlled organizations include the Swiss Association for Normalization (AsN), which is concerned about exports standards, and the Export Aide for Wine, Cheese, Milk Products, Potatoes, Fruits & Cattle scheme of the Federal Agriculture Office (OFAG).

zz Competence-sharing is regulated by an internal document, Kompetenzauslegung zurischen OsEC-seco-EDA — Funktionendiagramm in der Exportf6rderung (no date) cited in CONTReLE FtDtPAL DES FINANCES, supra note 17, note 47 at 44. 23 Bureau de 1'integration DFAE/DFE. Formally subordinated to MOE, it also collaborates closely with MOFA. See . z^ Some of the bilateral Swiss chambers of commerce are members of the Association of Foreign Chambers of Commerce (SwissCham), which, despite its deceiving name, gathers bilateral chambers, Swiss- or foreign- controlled, in Switzerland and abroad. See . zs The annual cost of external trade promotion supported by the Swiss government was estimated at CHF 47 million per year in 2005, of which 50 per cent for MOFA, 5 per cent for seco, 35 per cent for OSEC, 10 per cent for Sop), and less than 1 per cent for the bilateral chambers of commerce. See CONTRlJLE federal DES FINANCES, supra note 17, p. i. zs See . Certain cantonal or regional chambers of commerce in Switzerland also promote the external trade policy. 27 economiesuisse is the largest umbrella organization representing the Swiss economy. Its members include trade and industry associations, cantonal chambers of commerce and individual companies. See supra note 17. See in particular "Recommendations", id. p. 82 ff. See also CONSEIL federal, RAPPORT SUR LA POLITIQUE ECONOMIQUE EXTERIEURE 2004 ET MESSAGE CONCERNANT DES ACCORDS ECONOMIQUES INTERNArIONAUX, FF 2005 p. 993, n. 7.3 at 1116 (12 January 2005). z9 See .

30 So far, it has also been entrusted to Swissmem, which will keep operating it until AsRE takes over; see . Both guarantees will be discussed in Part u of this article. See . In 2003, DDC's budget was almost fivefold seco's. 3z See . 37 See DDC/seco, RAPPORT ANNUEL DE LA cooperation INTERNATIONALE DE LA SUISSE 2004. The relevance of this policy with respect to the protection of exports and investments will be discussed in Part u of this article. 34 Switzerland has entered into a wealth of bilateral treaties or agreements of all kinds, probably thousands of them. Only treaties which are concerned with trade and investments generally, rather than with some specific area or purpose, are discussed here. All published treaties are available at . See also .> (for additional information, namely on non-published treaties, and a classification by country). �s The oldest TOF is the treaty with the United States of America of 1850, RS, followed by the treaty with the British Empire in 1855, RS The first is still in force; the second has been split and succeeded to by certain of the States which succeeded to the former British colonies. 36 TOFs are classified under RS 0.142.

3� The penultimate but last Ton for four decades was signed in 1963; however the last Top was signed with Albania in 1995, RS '" Switzerland has a Toc with 91.7 per cent of the countries with which it has a BIT, or 88 out of 96. '� See intra IV.C.2, "The World Trade Organization". °° Or has an Frn with EFrn.There are only 13 such countries left, all of which are under-developed or developing countries, one noteworthy exception being Russia. 41 Toes are classified under RS 0.946. ;2 See RS 0.975. 43 See infra "Annex Table 1: List of Swiss Bilateral Investment Treaties and Treaties of Commerce".

^^ BITS with several South American countries had in the meantime been brought to a halt with the so-called Calvo doctrine, which advocated in particular that foreign investors should not be treated better than locals. This doctrine was later dropped, enabling BITS to resume. q5 Notably, Switzerland had been considering negotiating a free trade agreement (FTA) with the United States of America since the EFTA's attempts failed, but this project was abandoned in 2005. See infra note 94. ah Arrete federal concernant la conclusion de traites relatifs a la protection et a l'encouragement des investissements de capitaux, RS 975 (27 September 1963). After having been extended regularly, this order expired on 13 February 2004. Indeed, the Federal Council believed that a further extension was not justified since Switzerland has now concluded BITS with most countries. See CHANCELLEKJE federale (forthcoming 2006). I deduct from the foregoing that the Federal Council remains competent but that such competence now falls back under the general competence clause of Cst Article 54(1), see supra note 10.

4�Seeinfra IV.C.2, "The World Trade Organization". aa See infra Iv.c.1.(e), "The Policy Framework for Investment (PFi)". ^9 The protection of investments will be discussed at length in Part u of this article, on the protection of exports and investments. However, as BITS form a whole, provisions on the protection, expropriation and dispute resolution are briefly discussed here.

5U Mafezzini v. Kinqdom of Spain, ICSID Case ARB/97/7, Decision on Jurisdiction of 25 January 1999, p. 14 n. 38 ff at . The Mafezzini case was mostly concerned about the arbitration clause. Even though it relied on precedents, it considerably strengthened this principle. It has potentially far-reaching consequences for Switzerland as far as inbound investments are concerned, considering Switzerland has almost 100 BITS. 11 See also id. 52 See infra IV.A.3.(b).(vi), "Miscellaneous Provisions". 53 It has been regretted that the distinction between "treatment" and "protection" is often blurred, despite them being substantially different concepts. Arguably, protection intervenes only if and after fair treatment has not been granted and is afforded by the provisions on dispute resolution (and to some extend on expropriation), not those on treatment. See DOMINIQUE CAItREAU & PATRICK JUILLARD, DROIT INTERNATIONAL TCONOMIQUE, 2nd ed. (Precis Dalloz ed., Paris 2005), p. 438 ff. The draft MAI expressly distinguished treatment from protection. See infra note 124, OECD, Parts III and IV.

54Seesupra note 49.

55 See supra note 49. 56 On this topic generally, see J.-C. Liebeskind, One-Hundred-Two Swiss Bilateral Investment Treaties: An Overview Of Investor-Host State Dispute Settlement Clauses, 19 ASA SPECIAL SERIES 81 (2002).

57 Due to their complex history, the terminology of the European institutions is somewhat confusing. European Communities was the name given collectively to the European Coal and Steel Community (Ecsc), the European Economic Community (EEC), and the European Atomic Energy Community (Euratom), when in 1968, they were first merged under a single institutional framework with the Merger Treaty signed in Brussels on 8 April 1965. That treaty created the European Commission and the Council of the European Communities. The European Community (EC), most important of three European Communities, was originally founded on 25 March 1957 by the signing of the Treaty of Rome under the name of European Economic Community (EecC). The "Economic" was removed from its name by the Maastricht Treaty in 1992, which at the same time effectively made the EC the first of three pillars of the European Union (EU), called the Community (or Communities) Pilar. s'? For comprehensive resources, including the legal bases, on both the EU and EFTA, see the Website of the Bureau de 1'integration DFE-DFAE at . Only selected legal bases will be given here. See also Ee'rn's Website at Members and the Agreement entered into by EFTA Members and the EEA. Indeed, EFTA has no legal personality as such; only its Members have.

60 Accord entre la Confederation suisse et la Conununaute 6coiionLique europeenne, RS 0.632.401 (signed in Brussels on 22 July 1972). fir Sce supra note 59. 62 The EEA Agreement was rejected in Switzerland by popular vote on 6 December 1992. h; The EFA Agreement was signed in Oporto, Portugal on 2 May 1992 and entered into force on 1 January 1994. This Treaty institutes the four fundamental liberties of the EU, i.e. free movement of goods, services, capital and persons. The objectives of the EEA are namely to improve competitiveness of undertakings and to raise the wealth of the population, to promote free competition with the four basic liberties, to improve the economic and technical basis of European industry, and to structure the relationships between States without restricting their autonomy to make decisions, in particular their capacity of concluding international treaties. At the same time, EEA Members, not being EU Members, maintain custom controls; they do not take part in the European Monetary Union, have no say on the decisions taken by the EU and have, in particular, no voting rights in the legislative process. The EEA is seen as a preliminary step to EU full membership, which certain EEA Members did indeed obtain after some time. See CONSEIL federal, MESSAGE RELATIF i1 L'APPR(7UA'1'I()N 1)E ACCORD SUR. L'ESPACE ECONOMIQUE EUROPEAN, FF 1992 is p. 1 (18 May 1992). As of 1 May 2004, the EU has been enlarged to include ten new Members: Cyprus; the Czech Republic; Estonia; Latvia; Lithuania; Hungary; Malta; Poland; Slovenia; and the Slovak Republic. The EU Treaty of Accession 2003 of 16 April 2003 explicitly states that a country becoming a Member of the EU shall also apply for membership of the EEA (Article 128). The terms and conditions for such participation shall be the subject of an agreement. On this basis, the European Commission, the EEA EFTA States and the ten applicant countries in the first half of 2003 negotiated the EEA Enlargement Instrument, which ensured the entry of the ten new EU Member {footnote continued on next p,�qe)

States into the EEA. The legal texts of the EEA Enlargement Instrument were signed on 11 November 2003 and ratified in the parliaments of all 28 EEA States. The goal was to ensure a simultaneous enlargement of the EU and the EEA on 1 May 2004. The Internal Market has thus increased to comprise some 455 million consumers; common EEA rules and standards which facilitate trade in an enlarged EEA; and citizens will have the opportunity to work and live in new countries. 6S See "Retirer la demande d'adhesion au moment oil le peuple conforte notre politique européenne serait un autogoal", LE TEMPS, 26 September 2005. Another federal popular initiative requesting that Switzerland adhere to the EU was massively rejected by 77 per cent of the voters on 4 March 2001. For more information on the Swiss external policy in the 1990s, see CONSEIL FEDERAL, RAPPORT SUR LA POLITIQUE EXTERIEURE DE LA SUISSE DANS LES ANNTES NONANTE, FF 1994 I p. 150 (29 November 1993). See also Bureau de 1'integration DFAE/DFE, La politique europénne de la Suisse, at �,. 6i Following the successful vote on the last treaty on the extension of the free movement of persons to the ten new EU Member States (see infia IV.B.I.(b).(iii), "Extended Free Movement of Persons"), the Swiss and EU Ministers of Foreign Affairs informally mentioned in a press conference the possibility of negotiating a framework treaty which would comprehensively coordinate the existing treaties. See L'idee d'un accord-cadre avec Bruxelles est desormais sur la table, LE TEMPS, 28 September 2005. 67 The negotiations started in 1994. 68 The Agreements were concluded on 1 December 1998 in Vienna and were signed on 21 June 1999. s9 See supra note 64. The then 15 Member States of the EU were Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom. More precisely, the Bilaterals I were concluded with the EU, with the exception of the Agreement on free movement of persons, which was concluded with the EU and each of its Member States individually, and the Agreement on research (i.e. on scientific and technological co-operation), which was concluded with the EU and Euratom. 70 See RS 0.122. See also Bureau de 1'integration DFAE/DFE (Section information), Suisse-Union europeenne: negotiations bilaterales sectorielles, Fact Sheets, edition spéciale IV (Bem sunUl1er 1998). 71 The referendum took place on 21 May 2000. As much as 67 per cent of the voters accepted the agreements, in sharp contrast with the 1992 vote on the EEA. The European Parliament approved the agreements on 4 May 2000. 72 Ground transport: RS 0.740.72; air transport: RS 0.748.127.192.68; free movement of persons: RS; research: RS 0.420.513.1; public procurement: RS; technical barriers to trade: RS 0.946.526.81; and agriculture: RS 0.916.026.81. �j This agreement allows Swiss research establishments to participate on an equal footing in all programmes and activities of the Fifth and, thanks to an additional agreement, to the present Sixth EU Framework Research Programme (2003-2006).

Free movement of persons for employment purposes will be introduced in Switzerland after a period of 12 years if it confirms the agreement after seven years. This agreement is coupled with a very large rail infrastructure project in Switzerland. '6 Cheese, fruits and vegetables. " This agreement extends beyond WTO rules (which apply to water, transport and energy) to touch other entities and fields (local authorities, telecommunications, rail transport, and private enterprises operating on the basis of concessions). 78 See supra W .t3.�.(a), "The 1972 EFTA Bilateral FTAs and the 1994 EFTA-EEA Agreements". 79 See infra IV.B.l.(b).(iii), "Extended Free Movement of Persons". H° The Schengen and the Dublin systems institute co-operation in the fields of police, judicial assistance, asylum and migration. The "Leftovers" were listed in an addendum to the Final Acts of the Bilaterals and included transformed agricultural products, statistics, environment, MEDIA (an EU movie promotion programme), education, pension schemes and services. 12 Political issues include security, asylum, environment, statistics, culture and education.

83 Savings taxation: RS 0.642.026.81; cross border judicial assistance for indirect taxation fraud: RS 0.351.926.81; Schengen: RS 0.360.268.1; Dublin: RS 0.142.392.68. "Leftovers", i.e. transformed agricultural products: RS 0.632.401.23 and RS 0.632.401.2; statistics: RS 0.431.026.81; environment: RS 0.814.092.681; MEDIA: RS 0.784.405.226.8; pension schemes: RS 0.672.926.81. Education was not settled in the form of an agreement but of mutual letters of intent; see ��. 84 The post-negotiations stage of the Bilaterals 1I is particularly complex. The negotiations were started in June 2002 and successfully concluded one year later for seven out of nine agreements. The difficulties, mostly related to banking secrecy, were overcome for the two last agreements on 19 May 2(104. The nine agreements were signed on 26 October 2004. Seven agreements were submitted to optional, citizen-initiated referendums. One such referendum was requested against the agreement on the Schengen/Dublin systems, but that agreement was accepted by 54.6 per cent of Swiss voters on 5 June 2005. The agreements are now gradually entering into force. Sfe CONSEIL FEDERAL, MESSAGE RELATIF A L'AI'L'li()FiATIC>N DES ACCORDS HILATERAUX ENTRE LA SUIVSE E�1' L'UNION EUROPEENNE, Y COMPRIS LES ACTES LEGISLATES RELATIES A LA TRANSI'C)SITI()N DES ACCORDS ("ACCORDS HHATEKAUX u") (1 October 2004), FF 2004 p. 5593 (9 November 2004). See also Bureau de 1'integration DFAE/DFE, "Signature et approbation", at $s See supra IV.D. I.(b).(i), "Bilaterals I". 86 See suyra note 64. a� FF 2004 p. 5573 (9 November 2004). 88 RS 142.20. H9 See also supra Iv.ts.l.(a), "The 1972 ErTA Bilateral FTAs and the 1994 EFIA-EEA Agreements". However, the 1972 and 1994 treaties are hardly relevant under this heading since the former is bilateral and Switzerland the only EF'1'A Member left for which it still is in force, whereas Switzerland is not part of the EFTA-EEA Agreements. '"' See En atid EU Enlargement, EF I BuLLETIN (September 2004).

For comprehensive resources, including legal bases, on EFTA, see supra note 58.

92 In Barcelona, Spain, on 27-28 November 1995, the governments of 27 countries, the EU Council and the European Commission established the Euro-Mediterranean Partnership (EMP or Barcelona Process) and adopted the Barcelona Declaration, which, among other things, aims at a free trade zone by 2010. y3 See infia note 104. �4 In addition to the negotiations already officially started, at its Ministerial Meeting in Vaduz, Liechtenstein on June 2005, EFTA expressed its interest in China, Japan, Syria, Russia and Ukraine. A high-level meeting on trade and investment facilitation with the United States of America took place in Washington, D.C. on 15 June 2004 but did not result in the opening of official negotiations. A similar attempt by Switzerland was also abandoned in 2005. 95 EFTA also set up an Industrial Development Fund for Portugal. 9s Chapter IX of the Vaduz Convention on "Investment" covers establishment and capital movements. For the full text of the Vaduz Convention, see the EFTA Website at .

97 Special arrangements apply for processed agricultural products, while trade in basic agricultural products is subject to bilateral protocols. 98 All EFTA FTAs but a couple of the earliest (with Bulgaria and Turkey) contain at least a provision expressing the parties' intent to consider extending their agreement to investment and services in the future. More evolved clauses contain a best-endeavour commitment, including express reference to a BIT; see, for example, the F'rA with Lebanon, Article 26(b). Despite not applying to investments as such, these treaties generally contain a binding clause on the transfer of investments and their repatriation including revenues; see, for example, the FTA with Jordan, Article 15(3).

99 The FTA with Chile does not mention investments but refers to "establishment"; see Chapter III. 100 The ETAS with Mexico, Singapore and Chile contain a comprehensive set of rules on investments and services, as well as on public procurement, competition and protection of intellectual property. The FTA with Croatia, which can be seen as the precursor of the last generation, is less evolved but already contains a most- favoured-nation clause as well as express best-endeavours commitments; see Article 16, namely 16(2). 1°I See FF 2006 p. 963. This will replace the 1971 BIT between Switzerland and South Korea after ratification. Despite the fact that Norway abstained from signing, and the Treaty's title reading "Accord sur l'investissemetit entre la Republique d'Islarlde, la Ptiricipaut6 du Liechtenstein, la Confederation suisse et la Republigue de Cor�e", Switzerland, Liechtenstein and Iceland are literally addressed as "the EFTA Parties" ("les Parties a I'Aele"). The Toi forms expressly part of the FTA. See id., Preamble, p. 963. Norway is said to have withdrawn from the negotiations on investments because of reservations related to its Constitution; see MESSAGE CONCERNANT L'ACCORD DE LIr3RE- ÉCHANGE ENTRE LES ETATS DE L'AELE ET LA RENUHLIQUE DE COREE, L'ACCORD SUR L'INVESTISSEMENT ENTRE L'ISLANDE, LE LIECHTENSTEIN, LA SUISSE ET LA COREE, AINSI QUE L'ACCORD AGRICOLE ENTRE LA SUISSE ET LA COR�E, FF 2006 p. 908 (9 December 2005). Therefore, I believe that this Toi can be legitimately regarded as a genuine and the first EFTA Tol. 102 See FF 2006 p. 929. Unlike the BIT, the FTA unambiguously refers to the "EFTA States" in its title, which reads "accord de libre-echanAe entre les Etats de l'AeLE et la Republigue de Corie"; compare with supra note 101. 1°; The Gcc gathers Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. So far, Switzerland has entered into BITS only with Kuwait and the United Arab Emirates. 104 Mercosur gathers Argentina, Brazil, Paraguay and Uruguay. However, as discussed below, it has extensive relationships with most Latin American countries and is therefore seen as the leading free-market organization in the region. "'5 SACU gathers Botswana, Lesotho, Namibia, South Africa and Swaziland. 1°6 ASEAN gathers Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Viet Nam. Switzerland has entered into a BIT with all of these countries except Brunei and Myanmar. On 11 December 1996, ASEAN and EFTA held their first Ministerial Meeting in Singapore and issued a joint press statement expressing their mutual commitment to work in closer co-operation. No formal negotiations have been opened so far, though. 1°' See supra note 92. 109 Id. 109 The NAFTA gathers the United States of America, Canada and Mexico.

I'll However, see supra IV.A.3.(b).(ii), "Protection, Fair and Equitable Treatment and Most-favoured nation Treatment". See RS 0.972.31. Switzerland is also a Member of the African Development Fund, RS 0.972.32. In addition, it has concluded agreements with the East-African Development Bank, the West-African Development Bank and the Madagascar Central Bank. 112 See RS 0.972.2. Switzerland has also concluded an agreement with ASEAN. 113 See RS 0.972.4. The lAB mostly cares for Latin America. I'' See RS 0.972.1. Switzerland has also concluded an agreement with the European Investment Bank. 115 See RS 0.972 for a list of multilateral financial aid treaties entered into by Switzerland. See also RS 0.973, which includes bilateral aid. See also the DFAE Website at � index o.htrtil, for a list of the international organizations with which Switzerland has signed a treaty. 116 See supra note 31.

117 OECD gathers Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, the Republic of Korea, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and the United States of America. See also infra note 121. z 18 China is not a member of the OECD because it has failed to meet these criteria so far. The OECD has been referred to with some contempt as a "dub de riches" by certain Chinese officials. 119 For comprehensive resources, including legal bases, on the OECD, see the OECD Website at

120 On the Codes, see, for example, CARREAU & JmLLnRn, supra note 53 pp. 416-417. 121 The 30 OECD Member countries plus nine non-Member countries: Argentina, Brazil, Chile, Estonia, Israel, Latvia, Lithuania, Romania and Slovenia. �2z Including employment and industrial relations, human rights, environment, information disclosure, competition, taxation, and science and technology.

t2a The 2000 Review was adopted by the OECD on 27 June 2000. t2^ See OECD, Directorate for Financial, Fiscal and Enterprise Affairs, The MAi Negotiating Text (last version of 24 April 1998), at http://www. OECD. org/dataOECD/46/40/1895712.pdf,. This project was actively supported by Switzerland, which had submitted a draft. See also supra note 53 in fine. t2s On the MAI, see for example, CARREAU & JUILLARD, supra note 53 pp. 425-427 and 459-460. t2s See also the Doha Declaration of the Fourth WTO Ministerial Conference in Doha, Qatar in November 2001, which provides for negotiations on a range of WTO-related issues, at supra note 53 pp. 379 and 427. t2� See OECD, Investment Division, Directorate for Financial and Enterprise Affairs, Policy Framework for Investment (PF;), Draft text for public consultation (until 10 February 2006), at �htip:// document/42/0,2340,cn -2649 - 34529562 35725418_1-1-1-34529562,00.htmi). 128 These are: investment policy; investment promotion and facilitation; trade policy; competition policy; tax policy; corporate governance; policies for promoting responsible business conduct; human resource development; infrastructure and financial services; and public governance. t=y It appears to be welcomed by the Swiss government; See CONSEIL FEDERAL, RAYVURT SUR LA NOLITIQUE TCONOMIQUE EXTÉRIEURE 2005, FF 2006 p. 1635, No. 3131 at 1681 (11 January 2006).

'3" Switzerland has been a Member since 1 July 1995. The WTO Agreement was opened to signature on 1 January 1995. 131 The W ro rules comprise approximately 30,000 pages. 132 See supra iv.c.i.(c), "The Policy Framework for Investment (PFI)". 133 Dispute settlement will be discussed in the second part of this article on the protection of exports and investments. l.\4 The purpose of the Trade Policy Review Mechanism is to improve transparency, to create a greater understanding of the policies that countries are adopting, and to assess their impact. Many Members also see the reviews as constructive feedback on their policies. All W ro Members must undergo periodic scrutiny, each review containing reports by the country concerned and by the WTO Secretariat. Over 45 Members have been reviewed since the W ro Agreement came into force. See nlso WTO supra note 1 1.

135 Examples of inconsistent measures, as spelled out in the Annex's Illustrative List, include local-content or trade-balancing requirements. The Agreement contains transitional arrangements allowing Members to maintain notified TRIMS for a limited time following the entry into force of the WTO. 136 A specialized institution of the United Nations, the World Bank is in fact a group, the World Bank Group, consisting of five institutions: the International Bank for Reconstruction & Development (IBRD) (not to be mixed up with the European Bank for Reconstruction & Development (EHKU), see supra tv.s.3, "Regional Financial Institutions"), the International Development Association (IDA), the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the International Centre for Settlement of Investment disputes (ICSID). Switzerland is a Member of all of them. See RS 0.972.2-4 and 0.975.1-2. MICA and Icsu� will be discussed in the second part of this article on the protection of exports and investments.

137Seesupra IV.B.3, "Regional Financial Institutions".

�3" Status as of 1 May 2006. Treaties for which a reference to the Reweil systematique des /ois ftdérales (RS) is missing have not been published yet. All errors and omissions are the author's own. Only the official publication is legally binding. All published treaties are available at See also ,]e/ forcigrr/intagr/dabase.html> (for additional information, namely on non- published treaties and a classification by country), as well as Ressort investissements intemationan.a et entreyrises multinationales is available for information. Under BITS, the entry S. Toe means "See Tocs". 119 Countries are listed by short name, not by their official name, except when qualification is necessary, e.g., "Congo (Brazzaville)" or "Korea, North" and "Korea, South". They are listed under their present name; for example, "Dahomey" is listed under "Benin". 'a" This list may contain references to TOFs, certain provisions of which amount to a Toe. This classification may not correspond to the RS and is the result of the author's own judgment. tar Date of signature. A date between parentheses means that the BIT had not yet come into force as of 1 May 2006. 142 See also RS 0.142. 111.5H 1. t;3 See also Toc of 26 August 1929, RS 0.946.291.721. 1. 144 Formerly Dahomey. t�5 FF 2002 p. 1405, 1474. 146 "Temporary" treaty. 147 Formerly Hautc-Volta. riR See also RS 1. t^9 See also TOF of 13 June 1918, RS

ISO Formerly Zaire. 'S' Replaced BIT of 1 September 1965. 152 See also RS 0.946.297.431. 'S3 See also Top of 22 June 1888, RS 154 "Temporary" treaty. t5e See, however, Top of 7 May 1935, RS Even though this treaty is a treaty of friendship, it contains clear provisions on bilateral investments. As such, it could arguably be the oldest Swiss BIT. Several other Tops contain provisions theoretically applicable to FDI, but they are very summary and vague. See supra W .n.t, "Treaties of Friendship". 1S6 See also Toc of 31 March 1937, RS 0.946.293.491. 157 S� See also RS 158 "Temporary" treaty. 'S`' See also TOF of 10 February 1875, RS 1ó\J See also TOF of 19.8.1875, RS and RS See also "temporary" Toc of 28 August 1928, RS 0.946.294.361, and Top of 25 April 1934, RS

�6=Seealso 27 January 1923, RS 0.946.294.541. ���' Replaced the BIT of 11 November 1976. See also BIT of 11 1 November 1976, RS 0.975.248.1. 1(6 Will be replaced by the Toi which Switzerland signed together with its EHA partners Liechtenstein and Iceland (but not Norway) on 15 December 2005 after ratification of the latter. See also the related FTA signed the same day by EFTA Member States (including Norway); see infra note 186. 116 See also Toc of 26 August 1929, RS 0.946.291.721. �6� See also Toe of 2 September 1950, RS 0.946.295.631. 168 See also Toe of 19 August 1875, RS ���� See also Toc: of 6 March 1957, RS 0.946.296.142.1, and ToF of 6 September 1855, RS and RS 170 See also RS 1.

FF 1964 p. 413, 405. Temporarily applied since its signature. 172 Formerly Yugoslavia. The full name of post-Yugoslavia Serbia used to be "Republic of Serbia and Montenegro", but the status of this country is currently changing. See irfra note 218. 173 See also Toc of 27 September 1948, RS 0.946.298.181. '�4 See also RS 0.946.296.902. See also RS '�6 Will replace the BIT of 17 February 1974, RS 0.975.269.8. See also Toe of 20 March 1924, RS 0.946.297.141.

178 Status as of 1 May 2006. Treaties concluded by EpTA's Member States bilaterally; see supra note 59. 179 On 1 May 2004, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia joined the EU. Consequently, they terminated their Docs and FTAs with EFTA, as they now benefit from the agreement between EFTA and the EU within the EEA. See supra IV.B. i.(a), "The 1972 EFTA Bilateral FTAs and the 1994 EFTA-EEA Agreements". 180 See supra note 139. 's' Date of signature. '"2 Date of signature/entry into force. Only one date means that the treaty has been signed but has not yet entered into force. "N": negotiations (year of start of the negotiations, absent a Doc). 1M3 Treaties on Investment. 181 Negotiations were envisaged at the EFrA Ministerial Meeting held in Vaduz, Liechtenstein in June 2005. 185 See supra note 100. 'sb See FF 2006 p. 929. 187 See FF 2006 p. 963. Signed by Switzerland, Liechtenstein and Iceland (but not Norway). See also supra notes 101 and 165. 188 See supra note 172. 189 Temporary application, RS 0.632.317.581.

Seesupra note 178. See supra note 181. 1. See supra note 182. �93 This treaty is in fact a bilateral agreement concluded under the auspices of Eer�. Switzerland is the only EFTA Member left for which this treaty is still in force. See supra w.a.t.(a),"The 1972 EFTA Bilateral FTAs and the 1994 EFTA-EEA Agreements". 194 Date of entry into force. Switzerland is not a member; see id.

195 See supra note 139. 196 See supra Annex Table 1, "List of Swiss Bilateral Investment Treaties and Treaties of Commerce". 197 Id. 19a See supra Annex Table 2, "List of EFTA Treaties with Third Countries", and Annex Table 3, "List of EFTA Treaties with Regional Organizations". "R": regional treaty, followed by the name of the organization counterparty to the treaty considered. (FTA) or (R) means that official negotiations have been opened for the FTA or regional treaty considered. 199 Id. 200 As of 1 May 2006. 201 As of 11 December 2005. 202 References to Toes in the BIT column, and EFTA's FTAs or regional treaties currently negotiated, are not counted in the total. Treaties signed but not yet entered into force are counted. For the entry into force, see Annex Tables 1-3. zo Adhering country to the Open Guidelines for Multinational Enterprises, see supra note 121. 204 Id. 205 Id. 206 See also Hong Kong, Macao.

z°� Brazzaville. 2(1' The EC is a Member of the WTO in addition to its Member States individually. 201 See supra note 179. 210 See also China. 211 See supra note 179.

212 See supra note 165. 213 See supra note 179. 214 Id. 215 See also China. 216 Including the Netherlands Antilles.

217Seesupra note 179. 218 Serbia and Montenegro applied separately to the W'ro, but so far they have been treated as one State by Switzerland. 219 See supra note 179.

220 103 including the Toes containing provisions amounting to a BIT. 221 51 including treaties currently being negotiated. 222 See supra note 179.

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