New customs law in Switzerland

New customs law in Switzerland

Cross-border e-commerce to Switzerland might be facing changes, as the Swiss customs law is currently being revised. The goal of the revision would be the digitisation of Swiss customs, making it more organisationally flexible and attractive. In this blog, we have summarised the most important points of the customs law revision for you.

On March 6, 2024, the National Council adopted the bill on the new Customs Act drafted by the Federal Council, thereby laying the foundation for the legislative amendments. The law is currently being reviewed by the Council of States’ Committee for Economic Affairs and Taxation. Based on the current status, it now appears that not all of the planned changes will be implemented.

Current status as of July 2, 2024.

The Economic Affairs Committee dealt intensively with key issues in the detailed consultation on the Customs Act. As can be seen from the press release dated July 2, 2024, their proposals differ from the National Council’s decisions on several points. This is the current status:

  • Withdrawal of the easing: The Commission wants to withdraw the waiver of the declaration of goods not subject to customs duty, as proposed by the Federal Council.
  • No freedom of choice: Responsibility for the declaration of goods is to remain with the previous system, without freedom of choice for customs clearance.
  • Unclear time frame: The entry into force of the new customs law is still uncertain and depends on the further political process. We will continue to keep you up to date.

The draft passed by the National Council also affects cross-border e-commerce in Switzerland. The most important potential changes for your cross-border e-commerce business in Switzerland are summarised here. These will apply if the current draft of the law is approved.

National Council wants to ease customs declaration requirements for goods.

Goods that are not subject to duty could be exempted from the duty to declare under the new customs law. The easing envisaged by the National Council would presumably apply to consignments with a goods value of less than CHF 62.- (at an 8.1% VAT rate) and CHF 193.- (at a 2.6% VAT rate) and customs duties of less than CHF 5.- and which are not subject to any non-customs remissions.

Freedom of choice for customs clearance.

In the future, exporters and importers might be able to decide for themselves whether they wish to handle customs clearance independently. Transport companies and other service providers would be prohibited from imposing customs clearance costs on the recipients of shipments.

This means that, if they wished, consumers could handle the customs clearance of cross-border packages themselves, with all the necessary documents and data. Retailers could thereby save effort on their part, but would impose additional work on their customer, falling short of the local providers in terms of the shopping experience. Moreover, this would mean additional effort for the end customer and might possibly delay the delivery. Thus, it remains questionable whether end customers would effectively make use of this option.

Reading tip: Find out more about optimal customs clearance in Switzerland, the UK and Norway.

What would the changes to Swiss customs law mean for online retailers who ship to Switzerland?

The easing of the declaration requirement would primarily benefit merchants in the low-price segment with shopping carts under CHF 62.- (at 8.1% VAT). They could further reduce their international shipping costs. However, all packages above this value would incur VAT charges above the exemption limit and would still need to be declared. The identification of these declarable shipments must be accurately ensured and documented in the event of a customs audit. Master data maintenance would remain necessary, as every item, even those below the threshold value, might be subject to a declaration requirement depending on which other items the product is shipped with. The assessment would likely consider the entire end-customer order, not just the item itself.

The option for self-declaration by the end customer could mean that merchants would need to make customs-relevant information, such as weights, accessible to consumers, and the packages would need to be separated until successful customs clearance by the consumer. Customs costs would need to be deducted from the purchase price and appropriately itemised in the invoice for customers who handle the registration themselves.

Finally, it should be noted that adjustments to Swiss customs law would have no impact on EU customs clearance. In the event of a change in Swiss customs, all EU exports, including all relevant order data, would still need to be prepared. Besides the legal requirement, this would also be essential to ensure duty-free re-importation into the EU.

When will the new customs law come into force?

It is currently unclear when and in what form the new customs law will come into force. Now that the bill has been passed by the National Council, the matter will now go to the lower chamber, the Council of States (see the process for amending the law in Switzerland below). The Council of States is authorized to reverse the above-mentioned amendments adopted by the National Council. Following final approval by both councils, the transaction is subject to an optional referendum. The Federal Council will then determine the date of entry into force.

It is difficult to say when and with what provisions the new law will be introduced. However, due to the complex process and political disagreement, we expect the process to take several years.

Procedure for changing the law in Switzerland

In Switzerland, the legislative process is relatively complex and involves various stages, from the drafting of the law to its entry into force.

Before a law is discussed in Parliament, the responsible Federal Council (ministry) prepares a preliminary draft. This will be submitted to various stakeholders such as cantons, political parties, associations and other interested parties for comment in a consultation procedure.

Based on the feedback from the consultation process, the Federal Council is preparing a dispatch to Parliament containing a detailed explanation of the draft law.

The draft law is first discussed in one of the two chambers of the Swiss parliament – the National Council (large chamber) or the Council of States (small chamber). After discussion and possible amendments, the draft is put to the vote. The draft then undergoes the same procedure in the other chamber. Both chambers must approve the law. In the event of differences between the chambers, there is a procedure for settling differences.

Following approval by Parliament, an optional referendum can be held against the new law. To do so, 50,000 valid signatures must be collected within 100 days of the law being published or eight cantons must call for a referendum. If the referendum is successful, a referendum will be held.

If a referendum is held, the law will be submitted to the Swiss electorate for approval or rejection. The law only comes into force if it receives a majority of votes.

If the law is passed by Parliament and no referendum is held or the law is approved in a referendum, it will enter into force on a date set by the Federal Council. The Federal Council publishes the date of entry into force in the Federal Gazette.

Notes on the Swiss terms

Government of Switzerland, consisting of seven members.

A consultation process in which relevant interest groups have the opportunity to comment on a specific topic.

The 26 Swiss cantons are independent political units within Switzerland.

In Switzerland, it is possible for the electorate to decide on certain laws or parliamentary resolutions in a referendum.

An official letter from the Swiss government that is submitted to Parliament for consideration of certain issues.