I. Economic data

A. Macro-economic data

- General data[1]

Population 2021: 8,703,405 inhabitants
Area: 41,284 km2
Density: 210 inhabitants/km2
GDP (nominal) 2022: $777 billion[2]
GDP/capita 2022: $102,907[3]
GDP (PPP) 2022: $742.8 billion (20th)[4]
GDP (PPP)/capita 2021: $75,810[5]
Growth rate 2023: 0.0%[6]
GNI/capita (PPP) 2021: $75,810
HDI 2021: 0.962
Literacy rate: 99%
Life expectancy 2022: 84 years old

- Policy[7]
 
Switzerland is a federal State with 26 cantons and a parliamentary republic.
 
There are four official languages: German, French, Italian and Romansh.
 
The Swiss Federal Assembly is made up of the National Council, made up of councilors elected by proportional suffrage, and the Council of States, representing the cantons. The next elections will be
held in 2027.
 
The Federal Council governs Switzerland as a collegial body. Seven people from different political parties sit on the Federal Council. The Council is headed by the President of the Confederation, who is elected for a one-year term. At the time of writing, the head of government is Viola Amherd, from the canton of Valais[8].
 
- Economic development
 
Switzerland is the world's twentieth-largest economy. Switzerland has concluded several bilateral association agreements with the European Union.
 
Switzerland is a member of major international trade organizations such as the OECD, the UN and the WTO[9].
 
Switzerland is a major financial center specializing in wealth management[10].
 
The country experienced a period of recession due to the health crisis, resulting in a 2.4% decline in growth in 2020. Subsequently, the Swiss economy bounced back, posting a growth rate of 4.2% in 2021. However, the war in Ukraine caused a 22% increase in energy prices.[11]
 
The inflation rate was 2% in September 2023, well below the global average of 6.9%[12].
 
The unemployment rate is 3.9% (June 2023)[13]. The Swiss labor market has been characterized by near-full employment for several years now. Nevertheless, Switzerland is facing a labor shortage, and job vacancies exceeded 100,000 in summer 2022[14].
 
In 2022, Switzerland's public debt amounted to 39.1% of GDP[15].
 
- Resources
 
Switzerland's economy is based primarily on the service sector, which accounts for 74.8% of GDP. Agriculture accounts for 0.6%, and mining and industry for 24.6% of GDP.[16] Nevertheless, Switzerland is one of the most industrialized countries in Europe.
 
Switzerland has hydrocarbon resources (hydroelectricity, nuclear power plants)[17].
 
The tourism sector is also important in Switzerland, generating revenues of $9.9 billion in 2020[18].
 
- Population[19]
 
The urban population share is 74%. Three quarters of Switzerland is urbanized. Most of the population lives in the Plateau or Middle Country, between the Jura mountains and the Alps.
 
Young people under 15 account for 15% of the population, those aged 15-65 for 66% and those over 65 for 19%.
 
Switzerland's five most populous cities are Zurich (421,878), Geneva (203,856), Basel (173,863), Lausanne (140,202) and Bern (134,794).[20]
 
- Foreign investment
 
In 2021, exports of goods represented $432.6 billion and imports of goods represented $322.1 billion[21].
 
The main countries investing in Switzerland are the USA (holding 42.1% of the total FDI stock in Switzerland), Ireland (9.8%), France (4.5%), Germany (4%), the Netherlands (3.8%) and the UK (3.8%)[22].
 
Germany is the country with the most subsidiaries in Switzerland (3,535), followed by the USA (2,344), France (1,706) and the UK (1,513)[23].
 
Switzerland is one of the world's top ten capital exporters, attracting around CHF 1,000 billion in foreign direct investment[24].
 
B. Economic data specific to franchising
 
- Historical background
 
Franchising began to spread in Switzerland in the 1970s. According to one estimate, there were at that time 20 franchisors and 400 franchisees. The first franchise to set up in Switzerland was McDonald's in 1976[25].
 
The number of franchisors has multiplied by 7.5 in 30 years, reaching 150 franchisors in the 2000s[26].
 
- Institution
 
Switzerland used to have the Swiss Franchise Federation, which in 2021 became the Swiss Distribution Association (or Swiss Distribution) in order to focus more broadly on distribution networks[27]. The reason for this change was that companies might not use just one distribution strategy, but may operate several forms of distribution, in addition to franchising.
 
The association has drawn up a code of conduct for its members concerning distribution systems.
 
- Trade shows
 
The Swiss Distribution Association regularly organizes the Franchise Days in French-speaking Switzerland. The latest was held on November 22, 2023, and was the seventh edition[28].
 
Franchising courses are also organized. These courses are given in German. The aim of the courses is to teach existing or future franchisors the basics for setting up and managing a franchise system[29].
 
- Statistics
 
To our knowledge, there are no official statistics on franchising in Switzerland.
 
According to the Swiss Franchise Observatory, there are over 100 different franchise networks in Switzerland. Franchise sales average over 5 billion Swiss francs[30].
 
For example, McDonald's has 170 locations in Switzerland, employs 7,000 people and generates sales of 760 million Swiss francs[31].
 
In Switzerland, franchising is frequently used in the retail, health and wellness sectors. Next come gastronomy and fashion. There are fewer franchises in the consulting and real estate sectors[32].
 
34% of franchisees reckon that they will be profitable within 12 months, 26% within 24 months, 17% within 6 months and 14% after 24 months[33].
 
In 2022, the total number of insolvencies opened against companies and individuals rose by 6.6% year-on-year to 15,009. This increase was particularly noticeable in the cantons of Ticino, Bern and Zurich. However, the increase in the number of bankruptcies is lower than between 2020 and 2021, which was +9.1%[34].
 
- Contract content
 
The franchise fee is usually between 5 and 10%[35].
 
To enter a franchise, 28% of franchisees have to contribute more than 100,000 Swiss francs, 26% up to 100,000 Swiss francs, and 20% up to 50,000 Swiss francs[36].
 
- Special features
 
The fact that the country has four official languages can make it difficult to set up a franchise throughout the country[37].
 
In addition, Swiss franchisees sometimes encounter difficulties in obtaining loans from their banks, making it difficult for them to access the market[38].
 
- Economic impact
 
In 2016, the franchise sector employed 320,000 people and accounted for 7% of the wealth generated in Switzerland[39].
 
- International
 
Only a quarter of franchises are of Swiss origin.[40] Of the top five Swiss franchise companies, only one is of Swiss origin. These companies are, in order[41]:
 
-AURUM Training (Switzerland);
-McDonald's (United States);
-Coffee-Bike (Germany);
-Mrs. Sporty (Germany);
-Storebox (Austria).
 
II. Legal information
 
A. Legal information directly related to franchising
 
- Applicable legislation

Switzerland has no specific franchise law or regulation. However, in a decision dated September 8, 2011, the Swiss Federal Court[42] defined a franchise contract as a contract for the distribution of goods and services by independent traders or entrepreneurs, who are the franchisees, but according to a unified distribution concept implemented by the franchisor. To this end, the franchisee is entitled to use the franchisor's trademark, equipment and other property rights. The franchisor provides the franchisee with assistance, advice and training.
 
Marc Haesler, head of French-speaking Switzerland for the Swiss Distribution Association, defined franchising as the provision of a brand and know-how between two companies that remain economically and legally independent[43].
 
The Swiss Code of Obligations and the Civil Code govern franchise contracts.

- Pre-contractual information
 
There are no specific rules governing pre-contractual information for franchise agreements. However, in the name of the principle of good faith enshrined in the Civil Code and Code of Obligations, all information disclosed during the pre-contractual phase must be accurate, and the prospective franchisee must be provided with all necessary information on the future contract[44].
 
- Contract performance
 
Under the Swiss Civil Code and the Swiss Code of Obligations, good faith must govern relations between the franchisee and the franchisor.
 
The Federal Supreme Court has ruled that, in the case of franchise agreements, general terms and conditions must be validly incorporated into the contract. However, the agreement between the parties takes precedence over the content of the general terms and conditions[45].
 
The Swiss Distribution Association explains that, for franchise agreements, the maximum duration of a contractual obligation, the exclusion of the franchisor's liability towards the franchisee and its customers, and the limits on the franchisee's entrepreneurial freedom must be explained and structured within the franchise agreement[46].
 
- Jurisdiction and applicable law
 
Switzerland ratified the New York Convention on Arbitration[47] on June 1, 1965, facilitating the recognition and enforcement of foreign arbitral awards.
 
- Trademarks
 
Trademark rights are governed by the Swiss Federal Trademark Law[48]. Section 1 of the Swiss Federal Trademark Law defines a trademark as a sign capable of distinguishing the goods or services of a particular enterprise from those of other enterprises.
 
To be protected, a trademark must be registered with the Swiss Federal Institute of Intellectual Property[49]. The first person to register a trademark is the owner of the rights. Trademark protection confers exclusive rights on its owner.
 
Switzerland is a signatory to the Paris Convention. As a result, Section 7 of the Swiss Federal Trademark Protection Act states that when a trademark has been legally registered for the first time in another member State of the Paris Convention, or the registration has taken effect in one of these States, the applicant or his successor in title may claim the date of the first registration in order to register the same trademark in Switzerland, provided that the registration in Switzerland takes place within six months of the first registration.
 
According to Section 10 of the Swiss Federal Law on Trademark Protection, once registered, a trademark is protected for 10 years from the date of filing and is renewable. Section 11 of the same law specifies that protection lasts as long as the trademark is used in connection with the registered goods or services, and that use of the trademark likened to use by the owner.
 
Switzerland is also a member of the Madrid System, which enables companies to obtain trademark protection in up to 130 countries by filing a single international application, in a single language, with the World Intellectual Property Organization (WIPO). Under Article 6 of the Madrid Agreement, trademark registration is valid for 20 years.

In Switzerland, trademark applications can be handled both nationally and through WIPO. Examinations cover only absolute grounds. Switzerland allows multi-class trademark registrations. Usage must be demonstrated within five years from the publication date of registration, with the owner's consent. To develop a franchise in this country, it is advisable to cover "Business assistance relating to franchising" and "retail services" which are both accepted under class 35 by the trademark office, with retail services requiring specification of the products concerned. Recording a franchising agreement is not compulsory but is advised for effectiveness against third parties.
 
B. Peripheral legal data
 
- Competition law
 
Competition law also applies to franchise agreements. Swiss competition law is made up of the Federal Cartel Act[50], the Federal Act on price supervision[51] and the Federal Act against unfair competition[52].
 
The Swiss Competition Commission is responsible for enforcing Swiss competition law. It tackles cartels and abuses of dominant positions. The Swiss Competition Commission also oversees mergers and prevents state interference with competition. The Competition Commission[53] regularly publishes communications and explanatory notes.
 
Setting minimum prices, restricting passive sales and a general ban on online sales are all prohibited[54].
 
The federal law against unfair competition prohibits the use of general terms and conditions that create a significant and unjustified imbalance between the rights and obligations of a professional and a consumer, to the detriment of the consumer.
 
- Personal data
 
Since September 25, 2020, the Federal Data Protection Act[55] has been in force in Switzerland. A national supervisory authority has been set up to monitor compliance with the Federal Data Protection Act: the Federal Data Protection and Information Commissioner[56] (Section 4).
 
The Federal Data Protection Act defines personal data as information relating to an identified or identifiable natural person.
 
Section 2 of the Federal Data Protection Act specifies that it applies to the processing of personal data concerning individuals by private individuals and federal bodies, with the exception of the Federal Chambers and parliamentary committees in the course of their deliberations.
 
For processing to be lawful within the meaning of Section 6 of this law, it must comply with the principles of good faith and proportionality. Personal data must be collected for specific purposes. These purposes must be understood by the data subject. Once the personal data collected is no longer necessary for the purposes of processing, it must be destroyed or made anonymous. The data collected must be accurate. The consent of the data subject is required for the processing of sensitive data (religion, political opinion, genetic or health data, data on social welfare measures, etc.), for profiling (any form of automated processing of personal data involving the use of such data to evaluate certain personal aspects relating to a natural person, in particular to analyze or predict elements concerning work performance, economic situation, health, personal preferences, interests, reliability, behavior, the location or movements of that natural person) carried out by a federal body and for high-risk profiling (any profiling entailing a high risk for the personality or fundamental rights of the data subject, because it leads to a matching of data which makes it possible to assess the essential characteristics of the personality of a natural person) carried out by a private person.
 
- Special provisions for foreign investments
 
The franchised company must be represented by a board member or director domiciled in Switzerland.
 
The Federal Act on Real Estate by Persons Abroad[57] specifies that foreign individuals or companies must obtain authorization to acquire real estate in Switzerland. However, the purchase of real estate intended for commercial use, such as hotels or offices, is not subject to any restrictions[58].
 
Main websites
 
-Intellectual property: https://www.ige.ch/fr/;
-Swiss distribution (formerly the Swiss Franchise Federation): https://www.swissdistribution.org/fr/Home.aspx;
-Personal data: https://www.edoeb.admin.ch/edoeb/fr/home.html;
-Competition: https://www.weko.admin.ch/weko/fr/home.html;
-Foreign investment: https://www.seco.admin.ch/seco/fr/home.html;
-Legislation:https://www.fedlex.admin.ch/fr/home?news_period=last_day&news_pageNb=1&news_order=desc&news_itemsPerPage=10;
-Swiss Federal Statistical Office: https://www.bfs.admin.ch/bfs/fr/home.html;
-World Bank: https://www.banquemondiale.org/fr/home;
-International Monetary Fund: https://www.imf.org/fr/Home.


[1] Unless otherwise stated, the data below is taken from the Atlas, socio-économique des pays du monde, Larousse, 2024 edition.
[2] https://www.touteleurope.eu/pays/suisse/
[3]Federal Statistical Office, National Accounts; Federal Customs Administration, Foreign Trade Statistics
[4] https://donnees.banquemondiale.org/indicateur/NY.GDP.MKTP.PP.CD?locations=CH
[5] https://www.larousse.fr/encyclopedie/divers/Suisse_activit%C3%A9s_%C3%A9conomiques/186953
[6] https://www.touteleurope.eu/pays/suisse/
[7] Unless otherwise stated, the information below is taken from the Atlas socio-économique des pays du monde, Larousse, 2024 edition.
[8] https://www.touteleurope.eu/pays/suisse/
[9]https://www.eda.admin.ch/eda/fr/dfae/politique-exterieure/organisations-internationales/suisse-organisations-internationales.html#:~:text=Commission%20statistics%20(UNSD)%20of%20council,%2DPBC)%2C%202023%2D2027
[10] Atlas, socio-economic of the countries of the world, Larousse, 2024 edition
[11] https://www.tresor.economie.gouv.fr/Articles/2019/02/04/suisse-situation-economique-et-financiere
[12] International Monetary Fund Report, World Economic Outlook, October 2023: Diverging Trajectories
[13] https://www.touteleurope.eu/pays/suisse/
[14] https://www.tresor.economie.gouv.fr/Articles/2019/02/04/suisse-situation-economique-et-financiere
[15] https://www.touteleurope.eu/pays/suisse/
[16] Atlas, socio-economic of the countries of the world, Larousse, 2024 edition
[17] https://www.larousse.fr/encyclopedie/divers/Suisse_activit%C3%A9s_%C3%A9conomiques/186953
[18] Atlas, socio-economic of the countries of the world, Larousse, 2024 edition
[19] Unless otherwise stated, the information below is taken from the Atlas, socio-économique des pays du monde, Larousse, 2024 edition.
[20] Wikipedia based on Olivier Keller and Davide Molinari, Swiss City Statistics 2022, Langnau, Federal Statistical Office and Union of Swiss Cities, 2022
[21] Atlas, socio-economic of the countries of the world, Larousse, 2024 edition
[22]https://www.tresor.economie.gouv.fr/Articles/2019/02/21/presence-et-investissements-francais-en-suisse#:~:text=The%20France%20has%20become%20the%2United%20States%20and%20Ireland.
[23] Ditto
[24] https://www.seco.admin.ch/seco/fr/home/Aussenwirtschaftspolitik_Wirtschaftliche_Zusammenarbeit/Wirtschaftsbeziehungen/Internationale_Investitionen.html
[25] https://www.pme.ch/business/2022/02/07/la-reussite-en-toute-franchise
[26] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf
[27] https://www.swissdistribution.org/sfv/media/_doc/pdf_VerbandIntern_F/CommuniquePresseRepranding.pdf
[28] https://www.swissdistribution.org/fr/formation-evenements/journee-romande-de-la-franchise
[29] https://www.swissdistribution.org/fr/formation-evenements/cours-sur-la-franchise
[30] https://www.observatoiredelafranchise.ch/
[31] https://www.pme.ch/business/2022/02/07/la-reussite-en-toute-franchise
[32] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf
[33] https://view.genial.ly/61e2e0c72a5e2f0d4b11e986/interactive-content-statistiques-franchises-en-suisse
[34] Press release from the Swiss Federal Statistical Office, Bankruptcies slow down in 2022, 12/04/2023
[35] https://www.pme.ch/business/2022/02/07/la-reussite-en-toute-franchise
[36] https://view.genial.ly/61e2e0c72a5e2f0d4b11e986/interactive-content-statistiques-franchises-en-suisse
[37] https://www.observatoiredelafranchise.ch/
[38] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf
[39] https://www.observatoiredelafranchise.fr/international/suisse/
[40] https://www.pme.ch/business/2022/02/07/la-reussite-en-toute-franchise
[41] https://fr.aurumfit.com/blog/5-erfolgreichsten-franchise-unternehmen-in-der-schweiz
[42] BGer 118 II 157
[43] https://www.pme.ch/business/2022/02/07/la-reussite-en-toute-franchise
[44] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf
[45] Ditto
[46] https://www.swissdistribution.org/en/distribution-in-switzerland.aspx
[47] New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958
[48] N°232.11
[49] Stauffacherstrasse 65/59g CH-3003 Bern, tel. +41 (0) 31 377 77 77, e-mail address: info@ipi.ch
[50] N°251
[51] N°942.20
[52] N°241
[53] Hallwylstrasse 4 CH - 3003 Bern, tel. +41 (0) 58 462 20 40
[54] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf
[55] N°235.1
[56] Feldeggweg 1, CH - 3003 Bern, tel. +41 (0)58 462 43 95, e-mail: webmaster@edoeb.admin.ch
[57] N°211.412.41
[58] https://www.franchise.org/sites/default/files/2022-09/2023%20Franchise%20-%20Switzerland.pdf