Zurich and Lausanne have long been considered choice international investor havens-stable, efficient, and famous in the business world. However, there is going to be a drastic shift. The Swiss Government is going to bring in a law which will allow the authorities to check and possibly bar certain foreign undertakings under the Investment Control Act (ICA), thus ushering in a change that is not simply a tweak but a watershed moment in the making. This new layer of regulation marks an end to policy making for companies that were beyond Switzerland for purposes of expansion or acquisition. In this article, therefore, we will show you all about the ICA: what it is, why it exists now, what areas it will cover and how this will change the investment landscape in Switzerland.
So Switzerland has no formal investment vetting system. Such a hands-off policy has always worked in its favor in attracting capital from different parts of the world. However, increasing concerns related to national security, risks from geopolitical issues, and strategic autonomy have changed the trend in recent years.
Here is what caused Switzerland to move in that direction:
The ICA is a proposed federal law that would create a mechanism for screening foreign investments in Swiss firms — particularly those operating in sensitive or essential sectors. The aim is to prevent unwanted takeovers that could threaten Switzerland’s public order, national defense, or technological sovereignty.
The first draft of the law was published in 2024 and is now going through the consultation phase. If all goes according to plan, it could be implemented by 2025 or 2026.
An extra level of scrutiny will be placed on investments coming from states supported investors. Thus, even if the business is construed as needing special protection, if its acquisition is an at least 25% state-owned or influenced by foreign state, automatically, it would go under review.
This would, of course, be directed at flows of investment from state-backed entities, especially those with base in China, Russia, or even from the Gulf.
In other words, prospective buyers would need to notify authorities before closing the deals on the covered sectors. Formal approval must be granted for the transaction to proceed.
These thresholds include:
Failure to comply could carry consequences:
While Switzerland has taken its time, this move puts it in line with most other developed countries. Around the world, governments are implementing similar frameworks — aiming to protect national interests in the face of strategic competition, technological rivalry, and rising geopolitical uncertainty.
The Swiss model is relatively focused compared to more expansive regimes like those in the United States or the United Kingdom. But the core logic is the same: foreign investment isn’t just an economic transaction anymore — it’s a potential strategic risk.
While the general political consensus supports the ICA, not everyone is on board.
Swiss industry groups have voiced concerns about overregulation. They argue the new system:
The business lobby economiesuisse has urged lawmakers to make the rules more focused and predictable.
Legal scholars have pointed out that terms like “national interest” or “public order” are vague and potentially open to interpretation. That could create legal uncertainty and make it harder for businesses to plan transactions.
Critics also worry the law could be politicized — that is, used to block certain deals not for national security reasons but because of economic nationalism or pressure from lobbying groups.
Despite criticisms, many see the ICA as overdue.
The Swiss government argues that without a screening mechanism, the country is exposed. Cybersecurity, energy reliability, and democratic independence all rely on who owns key infrastructure.
Officials emphasize that this law is about setting boundaries — not closing off entirely.
By establishing the ICA, Switzerland joins the ranks of countries adapting to today’s reality: investment is no longer just an economic issue — it’s strategic. The ICA helps the country stay aligned with European partners and maintain credibility in a changing world.
For foreign investors eyeing opportunities in Switzerland, this is the right time to start getting things into place.
In addition, the due diligence will become even more complex regarding the target company and whether it belongs to a protected sector and whether notification is required.
Ownership structures – especially those which have external links to other foreign states – will be put under microscope. Transparency shall be of supreme importance.
Most investments are likely to be cleared; however, there is the real risk of denial- or conditional approval-for investments in sensitive sectors.
As of early 2025:
In the meantime, companies should:
Such legislation has nothing to do with separation; it is only control-the control over making ownership of Switzerland’s most important systems and firms with the long-term security and democratic interests of the country.
Switzerland signals that it still welcomes foreign investment but wants to have a say in who gets to own what. And that is not an unusual position to take in the increasingly multipolar and politically volatile world.
The Investment Control Act is neither against global capitalism nor against it. The interests are only recalibrated.
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