SWITZERLAND: An Introduction to Family/Matrimonial: High Net Worth
Modernisation of Inheritance and Maintenance in Swiss Family Law
As of 1 January 2025, new provisions of the Federal Act on Swiss Private International Law (hereinafter nPILA) will come into force and will apply to estates opened since that date in any dispute of an international nature.
The main aim of the amendments made by the Swiss legislator is to reduce the risk of conflicts of jurisdiction with other States and to avoid contradictory decisions between States, by harmonising Swiss law in particular with the European Inheritance Regulation (EU no 650/2012 of 4 July 2012).
These amendments to the Federal Act on Swiss Private International Law will also allow to broaden the scope for international estate planning, whether in terms of choice of jurisdiction, or choice of law. It should be remembered that under Swiss law, only two types of dispositions of property upon death are possible: the will and the contract of succession. However, for Swiss citizens with dual nationalities who choose to have their estate governed by a foreign law, it is important to bear in mind the obligation to comply with the mandatory inheritance rules under Swiss law, in terms of statutory entitlement and therefore the disposable part for other beneficiaries.
These changes may also be of interest in anticipating a divorce by allowing the testator to submit his estate to Swiss law by means of a professio juris. It should be remembered that since 1 January 2023, Swiss substantive law has allowed the testator to partially or entirely exclude the spouse from the estate, by denying them, by will, the status of legal and reserved heir, in the event that divorce proceedings are initiated. A testamentary clause of this kind allows the testator to freely dispose of their assets after their death in the event that divorce proceedings are initiated, provided that the grounds for divorce are well-founded. In the absence of such a clause, Swiss substantive law provides that the spouse only loses their status as a statutory heir, but remains a legal heir until the divorce decree comes into force. Therefore, in order to exclude the surviving spouse from their estate before the divorce decree comes into force, the spouse must expressly mention it in a disposition mortis causa.
New rules on Swiss international jurisdiction in inheritance matters
When the deceased is a Swiss national domiciled abroad
Previously, if a Swiss national domiciled abroad had chosen to submit their estate to Swiss law (choice of law), the Swiss authorities had jurisdiction over the entire estate.
Henceforth, a testator who has made the choice of Swiss law may express reservations concerning Swiss jurisdiction and explicitly exclude it, ie, by indicating that he does not choose the jurisdiction of the authorities of the State whose law he has chosen. This new provision makes it possible to reduce the risk of positive conflicts of jurisdiction and to avoid a risk of fiscal connection for the levying of inheritance tax in Switzerland (new Article 87 paragraph 2 and Article 91 paragraph 2 nPILA).
Another change with respect to this new article is that the settlor may submit to Swiss jurisdictions not only his entire estate or property in Switzerland, but also only part of it, which is particularly important in the case of real estate located in Switzerland. This freedom also makes it possible to avoid conflicts of jurisdiction.
If a Swiss national domiciled abroad has not made a choice of jurisdiction in favour of Switzerland, or an unconditional choice of Swiss law, the Swiss authorities of the deceased's place of origin are only competent to deal with the estate, to the extent that the authorities of the deceased's State of domicile are not dealing with their estate. However, the Swiss authorities may decline jurisdiction if the deceased's foreign State of nationality, the State of the deceased's last habitual residence, or the State in which isolated assets are located, is dealing with the inheritance (new Article 87(1) nPILA).
When the deceased is a foreign national domiciled in Switzerland
Under the new law, a foreign national who has his last domicile in Switzerland will be able to make an explicit choice of jurisdiction in favour of a foreign national State of which they were a national at the time of disposal, or at the time of death, and thus exclude Swiss jurisdiction (new Article 88b paragraph 1 nPILA).
This new article provides for an equal treatment with Swiss nationals domiciled abroad, who can make a choice of jurisdiction in Switzerland, and ensure consistency with the European Regulation by avoiding the risk of a conflict of jurisdiction.
Where the deceased is a foreign national domiciled abroad with assets in Switzerland
The new article provides for a Swiss subsidiary jurisdiction of the Swiss authorities for the assets in Switzerland of a foreign national domiciled abroad, provided that the authorities of the State of domicile of the deceased do not deal with the assets in Switzerland. However, the Swiss authorities may decline jurisdiction if the authorities of a foreign national state of the deceased or the state of the deceased's last habitual residence, are dealing with the estate (new article 88 para. 1 nPILA).
In the particular case where several properties are located in different cantons in Switzerland, the Swiss authority that is first contacted has jurisdiction.
In this way, the non-action of the foreign authority, which may result from the fact that this authority is only competent for the property – movable or immovable – located on its territory, can be remedied.
New rules on the law applicable to international inheritance
In the absence of choice of law
The principle that the estate of a deceased person whose last domicile was in Switzerland is subject to Swiss law, remains unchanged (new Article 90 nPILA). Where the deceased had their last domicile abroad, their estate is governed by the law referred to in the rules of private international law of the State of their domicile. Henceforth, where these rules refer to Swiss private international law, it is the substantive inheritance law of the State of the last domicile which applies (new Article 90 paragraph 2 nPILA). Conversely, if the Swiss authorities of the deceased's place of origin are competent, substantive Swiss law applies (new Article 90 paragraph 3 nPILA).
New choice of law options
Under the old law, Swiss nationals domiciled in Switzerland were not able to make a choice of law in favour of a foreign law.
From now on, the new Article 91 nPILA allows Swiss nationals with several nationalities to choose the law of one of their national States, which increases private autonomy as sought by the European Regulation. However, dual Swiss nationals cannot derogate from the mandatory provisions of Swiss law relating to the disposable portion (Article 91 nPILA).
Under the new Swiss substantive law in force since 1 January 2023, the testator may freely dispose of 50% of the entire estate if there are descendants and a spouse, the other 50% being protected by the statutory entitlement of the aforementioned, whereas under the old law they could only freely dispose of an disposable portion corresponding to 37.5%.
In addition, a partial choice of law in favour of Swiss law is possible under certain conditions, ie, only for assets located in Switzerland and provided that the Swiss authorities are competent to rule on these assets. This competence of the Swiss authorities may result from a choice of jurisdiction by the Settlor or because they have not included any forum clause in their choice of law.