The COVID-19 pandemic has placed issues of life and death at the forefront of people's minds, with many people requiring intensive medical care which may deprive them of their capacity of judgement and require others to take decisions for them. This time of significant change is an opportune moment to consider the importance of taking preventive steps before a state of incapacity arises to ensure that individuals' wishes are respected, as well as the various means available to do so.
With COVID-19, investors who are facing cash calls and liquidity squeezes in other asset classes might be looking to realise some liquidity from their unsecured, unleveraged artwork collections; despite valuation risks, this could therefore be a time when investors turn to art loans to provide them with much-needed liquidity. Concluding an art-based loan agreement under Swiss law offers many advantages, and it will be interesting to see how this loan product fares in the aftermath of the COVID-19 crisis.
Private clients who want to resort to the services of Swiss free ports are facing greater transparency. They should be aware of the anti-money laundering obligations imposed on the dealers and financial intermediaries with which they trade, particularly regarding due diligence enquiries to which they could be subject. However, despite stricter regulation, Swiss free ports continue to offer many advantages.
From 1 January 2020, the Swiss Financial Institutions Act and the Swiss Financial Services Act will become law and introduce a regulatory regime for trustees operating in Switzerland, obliging them to obtain an authorisation to carry out their activities. The new regime should reinforce the general reputation and competitiveness of Switzerland as a financial centre and boost the Swiss trust industry's quality, integrity and accountability.
Estimated at $67.4 billion, the art market has become a global playing field for ultra-high-net-worth and high-net-worth individuals to invest their assets. Yet, lack of harmonisation of national legislations on the protection of cultural property may hamper collectors' pleasure in moving their art around the world. In a recent decision, the Swiss Supreme Court clarified the requirements to be met by countries of origin when requesting the return of artworks allegedly illicitly exported by their legitimate owners, thus absent any issues of ownership.
Swiss law is commonly used for construction contracts and is generally considered to be a safe option for good reason. But Swiss law does have some particularities that international parties might not expect. This article sets out five points that international parties should look out for when signing a Swiss law construction contract. With some forethought, parties can opt to contract out of these particularities or adequately address the allocation of risk that they entail.
The 2019 Conditions of Contract for Underground Works (Emerald Book) is a new standard form specifically for underground works that is the result of a lengthy collaboration between the International Federation of Consulting Engineers and the International Tunnelling and Underground Space Association. The Emerald Book contains several features aimed at addressing geotechnical uncertainty, including geotechnical baseline reports and mechanisms to adjust the time for completion and contract price.
New Swiss arbitration rules that are intended specifically for construction disputes contain several notable changes that may foreshadow the evolution of international construction arbitration procedures. Some or all of these innovations, which are aimed at improving efficiency and facilitating settlements, may prove to find widespread adoption among parties negotiating international construction contracts and arbitral institutions revising their rules.
Terminating a construction contract is the last resort for employers frustrated by delays, defects or other problems. Three recent Supreme Court cases illustrate some of the pitfalls of termination for employers. In all three cases, the employers' attempt to terminate for cause was construed as termination for convenience, exposing the employers to significant liability towards the contractors, including for lost profits.
Clauses that require a contractor to obtain the employer's pre-approval of the cost of any additional works are increasingly common in lump-sum construction contracts. According to a recent Federal Supreme Court decision, these pre-approval clauses will be applied strictly, subject to certain exceptions. In its decision, the court enforced such a clause to deny a contractor's claim to recover the cost of additional works performed by a subcontractor.