Switzerland: A Corporate/M&A Overview
Switzerland is one of the most attractive European jurisdictions for business activity and M&A. The country combines political stability, legal certainty and a resilient economy with a highly international business environment, making it a preferred location for both domestic and cross-border transactions. Switzerland has a strong and diversified set of core economic sectors, with traditional strengths in banking and financial services, pharmaceuticals and chemicals, engineering and commodities trading. In parallel, it has developed into a leading hub for innovation-driven sectors, including fintech, medtech and biotech, and is one of Europe’s leading jurisdictions for blockchain, crypto and digital asset businesses.
Switzerland is a federal state with three levels: the confederation, 26 cantons and more than 2,000 municipalities. Core areas relevant for M&A, including corporate and contract law, civil procedure and financial market regulation, are regulated at federal level ensuring a uniform legal framework throughout the country. Cantons retain autonomy in areas such as taxation and public law, with taxes further varying at municipal level.
Political stability is a defining feature of Switzerland. Executive power at federal level is exercised by the Federal Council (Bundesrat), a collegial body of seven ministers drawn from the country’s main political parties, who jointly govern the country. Members of the Federal Council typically remain in office well beyond their four-year term, contributing to continuity and predictability in policy-making. Switzerland’s system of direct democracy allows citizens to vote on legislation, international treaties and constitutional amendments. While this system tends to slow the legislative process, it also results in a high degree of legal stability and a restrained approach to legislation.
Switzerland consistently ranks among the world’s most competitive and innovative economies. In 2025, it was again recognised as the world’s most innovative economy by the Global Innovation Index (GII), reflecting strong performance in research, development and technology adoption. The country benefits from a highly skilled and international workforce, supported by leading universities and research institutions such as ETH Zurich and EPFL.
Key Legal Framework for M&A
Private M&A transactions in Switzerland are primarily governed by the Swiss Code of Obligations. A key feature of Swiss private M&A is the high degree of contractual freedom, as many statutory provisions are non-mandatory. This allows parties to structure transactions flexibly and to tailor risk allocation in both share and asset deals to the specific transaction context.
Public M&A transactions are governed by the Swiss Financial Market Infrastructure Act and its implementing ordinances. Compared to private transactions, public takeovers are subject to a higher degree of mandatory regulation, with more limited flexibility for bidders and target companies. The Swiss Takeover Board supervises public tender offers and reviews offer documentation as well as defensive measures. A distinctive feature of Swiss takeover law is the ability for listed companies to opt out of the mandatory tender offer regime or to increase the mandatory offer threshold from 33⅓% to 49%.
Statutory mergers, demergers and bulk transfers of assets and liabilities are governed by the Swiss Merger Act. These structures are used primarily in domestic transactions but are also available for certain cross-border transactions. Classic contractual M&A transactions continue to dominate Swiss market practice.
Corporate Law and Governance
The comprehensive corporate law reform, which entered into force on 1 January 2023, modernised Switzerland’s corporate governance framework and introduced increased flexibility for transaction structuring and capital management. Key changes include the permissibility of interim dividends and the introduction of the capital band, which authorises the board of directors to increase and/or reduce the share capital within a predefined range and period. These instruments are now commonly used in practice, including in the context of M&A transactions and corporate reorganisations.
The reform also strengthened governance and transparency requirements. Gender representation targets apply to boards of directors (30% as from January 2026) and the executive management (20% as from 2031) of large listed companies on a comply-or-explain basis. In addition, large listed companies are subject to expanded non-financial reporting obligations (eg, on environmental, social matters, respect for human rights and anti-corruption issues).
Executive compensation is a central governance topic in listed companies, with board and executive remuneration subject to binding shareholder votes, detailed disclosure obligations and limitations on certain compensation arrangements such as transaction bonuses.
Regulatory Developments
Switzerland has a liberal and investor-friendly regulatory environment. In December 2025, the Swiss Parliament adopted a new foreign direct investment (FDI) regime, which is expected to enter into force in 2027. It applies narrowly to direct and indirect acquisitions by foreign state-controlled investors of Swiss targets operating in particularly critical sectors, such as energy infrastructure, pharmaceuticals and vaccines, telecommunications and other security-sensitive areas, and is subject to turnover thresholds. The framework remains limited in scope compared to FDI regimes in many other jurisdictions. Sector-specific approvals are already required in regulated industries such as banking, insurance and financial services. Further, the acquisition of certain categories of Swiss real estate by foreign investors is restricted under the “Lex Koller” regime. Outside these narrowly defined scenarios, Switzerland offers a predictable and accessible environment for foreign investment and cross-border M&A.
Swiss M&A Market Trends and Outlook
Throughout 2025, Swiss M&A activity remained resilient despite ongoing geopolitical uncertainty, trade and tariff-related risks and a challenging financing environment. While overall deal count was broadly in line with prior years, aggregate deal volume increased significantly and returned to peak levels last seen in 2021, driven by a few high-value headline transactions, such as the merger of insurers Helvetia and Baloise, Holcim’s spin-off of its North American business, Amrize, and ABB’s sale of its robotics business to SoftBank (pending completion). IPO activity, by contrast, remained subdued, with only two Swiss IPOs in 2025. Despite record levels of dry powder and gradually easing financing conditions, private equity activity in 2025 remained cautious. Sponsors continued to demonstrate discipline in valuation and deal structuring. Technology, healthcare, financial services and industrials continued to be the most active sectors, with consolidation dynamics driving a number of transactions. The trend towards sector consolidation, as well as the spin-off of non-core divisions to sharpen strategic focus, is expected to continue in 2026.
From a structuring perspective, Swiss M&A practice in 2025 reflected a more balanced allocation of risk between buyers and sellers. Both locked-box mechanisms and closing accounts remain standard in Switzerland. Locked-box structures were frequently combined with interest components, and there was a renewed use of earn-outs, milestone-based consideration, vendor loans and other value-sharing mechanisms. Warranty and indemnity insurance is also widely used in Switzerland, in particular in private equity transactions, benefiting from favourable pricing and coverage terms.
Overall, the Swiss M&A market in 2025 demonstrated a high degree of adaptability. Transaction activity was driven less by short-term volatility and more by strategic considerations, reinforcing Switzerland’s position as a stable and attractive jurisdiction for domestic and cross-border M&A.