<h3>Implications for Swiss Companies</h3>
<p>On May 24, 2024, the Council of the EU adopted the Corporate Sustainability Due Diligence Directive. The Directive, which is part of the EU&#8217;s transition to a climate-neutral and green economy, lays down rules to ensure that companies operating in the EU respect human rights and the environment throughout their operations and value chains.</p>
<p>The Directive represents a significant shift in the EU regulatory framework on sustainable corporate governance, and will have a substantial impact on Swiss companies that operate in the EU market or that are part of a group that does. We summarize the Directive&#8217;s main features and highlight the implications for affected Swiss companies.</p>
<h3>A. Scope</h3>
<p>The Directive applies extraterritorially to non-EU companies with annual net turnover exceeding €450 million in the EU (or the ultimate parent company of a group that reaches this threshold). It also covers EU and non-EU franchisors and licensors (or the ultimate parent company of a group) with annual royalties over €22.5 million and a net EU turnover exceeding €80 million.</p>
<p>Additionally, Swiss companies not directly covered may also be impacted indirectly as business partners of upstream or downstream in-scope entities.<a href="#_ftn1" name="_ftnref1">[1]</a> In-scope financial institutions, for example, are required to conduct due diligence on their own operations and upstream business partners, such as investors, but not downstream business partners, such as borrowers.</p>
<p>Swiss companies that fall within these categories, are part of a group that does, or do business with in-scope entities, will be, directly or indirectly, subject to the Directive&#8217;s obligations.</p>
<h3>B. Obligations</h3>
<p>In-scope companies must integrate risk-based due diligence into their policies and risk management systems, covering both human rights and environmental impacts. These obligations are more detailed than and go beyond the due diligence obligations in the Swiss Ordinance on Due Diligence and Transparency, which are limited to child labor and certain minerals and metals.</p>
<p>The core due diligence obligations in the Directive include identifying and assessing actual and potential adverse human rights and environmental impacts, preventing and mitigating these impacts, monitoring effectiveness, and providing remediation.</p>
<p>In addition, in-scope companies must implement a climate transition plan, aligned with the Paris Agreement&#8217;s goal of limiting global warming to 1.5°C, and including time-bound and science-based targets for 2030 and five-year steps up to 2050. Companies must develop actions to achieve these targets and update their transition plans annually.</p>
<p>The Directive also requires companies to communicate publicly regarding their due diligence efforts, with annual statements on their websites, and to engage with stakeholders, establish a notification mechanism and complaints procedure, and monitor the effectiveness of their due diligence measures.</p>
<h3>C. Penalties for Non-compliance</h3>
<p>Member States will impose pecuniary and non-pecuniary penalties for breaches. Maximum fines shall be not less than 5 percent of net worldwide turnover in the preceding financial year. Non-compliant companies may also be barred from participating in public contracts and tenders, and authorities may publicly «name and shame» companies that fail to meet due diligence obligations.</p>
<p>Companies may also be liable for civil damages if their failure to conduct proper due diligence harms people or the environment. This reverses the typical burden of proof in favor of claimants, who may be individuals, groups, or organizations affected by the adverse impacts. The statute of limitations for such civil claims is five years, or not lower than the minimum period under national regimes for general civil liability.</p>
<h3>D. Compliance Timeline</h3>
<p>The Directive will enter into force twenty days after its official publication in the EU&#8217;s Official Journal, after which Member States will have two years to transpose the Directive into national laws.</p>
<p>For in-scope non-EU companies, compliance and reporting obligations will phase in depending on size and turnover. For those with annual net EU turnover exceeding €1.5 billion, compliance will begin three years after entry into force (2027); more than €900 million, after four years (2028); more than €450 million, after five years (2029).</p>
<h3>E. Next Steps</h3>
<p>Swiss companies potentially within the Directive&#8217;s scope should assess their current policies and practices against the Directive&#8217;s requirements and prepare to implement the necessary due diligence measures and transition plans. All Swiss companies should evaluate their role in the value chain of in-scope companies and anticipate potential requests for information or cooperation from their business partners.</p>
<p>Swiss companies should also monitor the development and implementation of the Directive&#8217;s requirements and further guidance from the EU, as well as the possible further development of due diligence legislation in Switzerland.</p>
<h6><a href="#_ftnref1" name="_ftn1">[1]</a> In-scope EU entities include companies formed under the laws of a Member State that have over 1,000 employees on average during the course of a financial year and an annual net worldwide turnover exceeding €450 million.</h6>


Homburger_Illu_DatentransferUSA_Preview_2020_09_V2

EU Corporate Sustainability Due Diligence Directive 

<p>The mortgage reference rate was introduced in 2008 with the aim of harmonizing the rent structure on the nationwide Swiss level. It is determined quarterly by the Federal Office of Housing (FOH) and is decisive for rent adjustments in existing tenancies. Since its introduction, the mortgage reference rate has fallen steadily and reached a historic low of 1.25% on March 3, 2020, at which it had since remained set.</p>
<p>Today, the FOH increased the mortgage reference rate for the first time in over 14 years, setting it at 1.5%. The new mortgage reference rate will apply from June 2, 2023.</p>
<p>If the required contractual conditions under the relevant lease agreements are in place, this adjustment of the mortgage reference rate entitles the landlord to unilaterally increase the rent by up to 3% (subject to further increases based on other factors such as inflation) as of the next possible termination date.</p>
<p>Landlords who wish to exercise this right may assert these increases in compliance with the contractual and statutory form and deadline requirements. In any case, increases must be notified using an official form, must include a justification and must be delivered at least 10 days before the start of the notice period. When sending the rent increase notification by registered letter, it should be noted that in case of failed delivery on first attempt, delivery is deemed to have taken place only after the expiry of the postal seven-day collection period.</p>
<p>The tenant has the right to terminate the lease agreement within the cooling-off period or to contest the rent increase within a 30-day period starting from notification of the rent increase.</p>


Increase of the mortgage reference rate

Corporate / M&A

Real Estate

Financing and Investment Products

Australian-Super-web-640x140

Homburger News

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<p>On September 12, 2023, AustralianSuper Pty Ltd. (AustralianSuper) announced the signing of a EUR 1.5 bn deal with DigitalBridge Group to acquire a significant minority stake in Vantage Data Centers Europe, Middle East and Africa (Vantage EMEA).</p>
<p>AustralianSuper will join DigitalBridge as key shareholder in Vantage EMEA, one of the fastest growing hyperscale data center platforms in the region. The deal will support Vantage EMEA’s ambitious growth plans and enable the expansion and development of hyperscale data centers across EMEA to meet the growing demand from global big data and cloud computing companies.</p>
<p>Homburger AG acted as Swiss legal counsel to AustralianSuper on this transaction. The Homburger team was led by Dieter Gericke (Corporate / M&amp;A) and included Claudine Schär and Giulia Meier (both Corporate / M&amp;A), Stefan Gäumann and Dominique Burà (both Real Estate) and Stefan Bindschedler (Financing and Investment Products).</p>
<p>Herbert Smith Freehills acted as lead counsel to AustralianSuper.</p>


Homburger advised AustralianSuper Pty Ltd. on its EUR 1.5 bn investment in Vantage Data Centers Europe

Employment and Executive Compensation

IP / IT

Healthcare / Life Sciences

Competition

Regulatory

Novartis

<p>On August 22, 2023, Novartis (SIX: NOVN) announced that it had agreed to transfer its real estate and certain infrastructure-related assets and services pertaining to the Life Science Park Rhine Valley in Stein, Canton of Aargau, Switzerland, to the industrial park operator Getec. Currently, almost 2,000 employees work in pharmaceutical and biotechnology companies on the Life Science Park Rhine Valley.</p>
<p>Upon completion of the transaction, the management and further development of the life science park will be taken over by Getec. The transfer is expected to be completed by the end of 2023 and 25 employees will move from Novartis to Getec.</p>
<p>Homburger advises Novartis alongside Freshfields Bruckhaus Deringer on the Swiss law and tax aspects of the transaction. The Homburger team is led by Daniel Häusermann (Corporate / M&amp;A, Real Estate) and includes Olivier Bühlmann, Daniel Kuhn (both Corporate / M&amp;A, Real Estate), Stefan Gäumann (Real Estate), Oriana Schöni (Corporate / M&amp;A), Reto Heuberger, Peter Müller and Philippe Weber (all Tax), Jürg Frick (Financing and Investment Products), Gregor Bühler and Marc Bircher (both Employment), Andri Hess (IP / IT, Healthcare / Life Sciences), Allegra Arnold and Katharina Bratvogel (both Competition, Regulatory), as well as other professionals.</p>


Homburger advises Novartis on the transfer of the Life Science Park Rhine Valley to Getec

Homburger for Aequita

<p>AEQUITA entered into an agreement to acquire the Swiss Glassolutions business from Saint-Gobain. The acquisition that is expected to close in May 2023 will further strengthen AEQUITA&#8217;s specialty glass division vandaglas.</p>
<p>AEQUITA is a Munich-based, privately held German industrial group, investing in special situations such as corporate carve-outs, successions and recovery situations across Europe.</p>
<p>Homburger acts as transactional counsel to AEQUITA. The team included Andreas Müller and Stefan Luginbühl (both Corporate/M&amp;A), Reto Heuberger and Philippe Weber (both Tax), Richard Stäuber (Competition) as well as Stefan Gäumann (Real Estate).</p>


Homburger advises AEQUITA on its acquisition of Saint-Gobain's Swiss Glassolutions Business

<p>Stefan Gäumann was admitted to the bar in 2010. He has broad dispute resolution experience in a variety of industry sectors, both in domestic and international disputes and proceedings. The focus of his practice are construction and real estate matters. Stefan Gäumann is a Swiss Bar Association certified specialist in Real Estate and Construction law and successfully advises and represents clients in complex and large scale construction projects and other real estate relates issues.</p>


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Homburger advised AustralianSuper Pty Ltd. on its EUR 1.5 bn investment in Vantage Data Centers Europe

Homburger advises Novartis on the transfer of the Life Science Park Rhine Valley to Getec

Homburger advises AEQUITA on its acquisition of Saint-Gobain's Swiss Glassolutions Business

EU Corporate Sustainability Due Diligence Directive

Increase of the mortgage reference rate

Commercial Real Estate in Switzerland: Overview 2024

Das Verfahren der dringlichen Feststellung gemäss SIA-Norm 150

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Homburger advised AustralianSuper Pty Ltd. on its EUR 1.5 bn investment in Vantage Data Centers Europe

Homburger advises Novartis on the transfer of the Life Science Park Rhine Valley to Getec

Homburger advises AEQUITA on its acquisition of Saint-Gobain's Swiss Glassolutions Business

EU Corporate Sustainability Due Diligence Directive

Increase of the mortgage reference rate

Commercial Real Estate in Switzerland: Overview 2024

Das Verfahren der dringlichen Feststellung gemäss SIA-Norm 150

Vernehmlassung Änderung BewG

Join the Team

Stefan Gäumann

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Languages

Bar Registration

Teams

Stefan
Gäumann