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Immigration

Switzerland

Croatia's accession to the European Union has had no bearing on the Agreement on the Free Movement of Persons between Switzerland and the European Union. The admission of Croatian nationals to Switzerland is still subject to the provision of the Foreign Nationals Act. However, Switzerland grants unilaterally preferential treatment for Croatian nationals who want to come to Switzerland to work.

The Agreement on Free Movement of Persons is once again applicable to EU-25 nationals, provided that they come to Switzerland to take up employment or have sufficient financial means. Until the law regarding a quota system is adopted, the agreement will continue to apply between Switzerland and the European Union.

The Swiss public recently approved a popular initiative aimed at stopping mass immigration. This brings with it the prospect of systemic changes to Switzerland's immigration policy. The new constitutional provisions require that immigration be restricted by means of quantitative limits and quotas. The outcome of the referendum can be described as a pivotal decision with far-reaching consequences.

The Federal Council has announced that the total number of work permits submitted to quotas for 2014 will remain the same as in 2012 and 2013. The council is reserving 3,000 L-permit quotas and 500 B-permit quotas for service providers of EU and European Free Trade Association member countries. To be eligible, a worker must seek to provide services in Switzerland for more than 90 days or 120 days respectively.

Third state nationals entering the Schengen Area must hold a travel document valid for at least three months beyond their intended stay. As part of the Schengen Area, Switzerland must ensure that travel documents are in line with this regulation on work permit applications or visa matters.

The Free Movement of Persons Agreement has been extended to include Croatia since it officially joined the European Union. The opening of the Swiss market to Croatia will be performed on a progressive basis. Switzerland will be able to restrict unilaterally the immigration of Croatian workers to Switzerland. Rules regarding restricted movement rights for Croatian nationals are intended to enter into force in early 2014.

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Real Estate

Switzerland

An initiative to restrict the construction of second homes recently came into effect. It will have a major impact on the property sector, as in communities where at least 20% of housing is already used as second homes, permission will not be granted for the construction of further second homes. Since the adoption of the initiative, a dispute has arisen as to how this clause should be interpreted and implemented.

The revised Civil Code recently came into force, introducing a register-based mortgage note and launching an integrated clearing system for the settlement of real estate transactions. With a register-based mortgage note, the creditor will be registered in the Land Register, which enhances transparency. The handling of real property transactions will be facilitated by the 'Terravis' electronic platform.

The Swiss Code of Civil Procedure has taken effect, replacing 26 cantonal Codes of Civil Procedure. The new code upgrades the role of the conciliation authority in landlord-tenant disputes by giving the authority greater competency. The parties can now agree to enter in mediation at any time during court proceedings, giving more weight to alternative dispute resolution.

Although triple-net lease agreements are still not often implemented in Switzerland, as a consequence of the entry of foreign investors into the Swiss commercial real estate market, recently such leases have become an increasingly common topic of discussion among real estate professionals, in particular in relation to sale and leaseback transactions and lease agreements for new single-tenant commercial buildings.

The federal Parliament has decided to revise aspects of the Swiss Civil Code on real estate. At the core of the revision is the introduction of a register-based mortgage note and an electronic real estate information system through which interested persons can obtain reliable and up-to-date information on real property online. The changes will facilitate real estate financing and transactions.

Switzerland will be one of the first countries in the world to establish a cadastre in which a significant proportion of property restrictions under public law are documented and published. Thus, legal certainty will be strengthened and the acquisition of information simplified. It will save the private sector time and money, as the relevant information regarding real estate will be more readily available.

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