Swissness-Update: Revised Ordinance on the Use of “Swissness”-Claims for Watches approved

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As part of the “Swissness” legislation (see our summary of the Swissness-Rules in BR-News of 16 February 2016) the Swiss Government has approved on 17 June 2016 the revised Ordinance on the Use of “Swissness”-Claims for Watches. The revised Ordinance will enter into force on 1 January 2017.

The Swissness-Legislation

The revised Ordinance on the Use of “Swissness”-Claims for Watches is part of a broader legislation work. Studies revealed that the brand “Switzerland” or the claim “made in Switzerland” is quite valuable in a globalized economy. Consumers are prepared to pay a higher amount for “Swiss made” products than for comparable products. With regard to watches it is estimated that the “Swiss-Bonus” may achieve 20%, for specific watches up to 50% of the entire sales price (see Erläuternder Bericht zur Revision der Verordnung über die Benützung des Schweizer Namens für Uhren, p. 3).

The purpose of the Swissness-legislation is to ensure that “Swissness”-claims may solely be used in connection with products that are mainly manufactured in Switzerland. The legislation shall prevent free-riding on the “Swissness”-reputation by companies that do not or only to a small extent manufacture their products in Switzerland (see Institut für Geistiges Eigentum (IGE): Mitteilung vom 17. Juni 2016, Revision der Verordnung über die Benutzung des Schweizer Namens für Uhren).

Stricter Requirements for Watches

In order to strengthen the “Swissness” of watches and to adapt the general Swissness requirements for the watch industry, the Swiss Government has approved the revised Ordinance on the Use of “Swissness”-Claims for Watches on 17 June 2016 (see Stärkung von “Swissness” bei Uhren, 17. Juni 2016).

The revised Ordinance sets out stricter rules for watches than the current ordinance (see Erläuternder Bericht zur Revision der Verordnung über die Benützung des Schweizer Namens für Uhren). The most important requirements are the following:

  • The watch in its entirety is relevant for the cost calculation. Under the current Ordinance, only the clockwork was relevant.
  • It is explicitly mentioned that smart watches are to be qualified as watches in the sense of the Ordinance.
  • At least 60% of the manufacturing costs of the entire watch must occur in Switzerland.
  • At least 50% of the value of the clockwork must stem from components that are fabricated / manufactured in Switzerland.
  • At least 60% of the manufacturing costs of the clockwork must occur in Switzerland.
  • The technical development of the watch and clockwork must be executed in Switzerland. In addition, the composition and final control of the watch must also take place in Switzerland.

Transitional Provisions

Transitional provisions were rather contested (between watch manufacturer and supplier). In the end both sides agreed to a compromise (see Stärkung von “Swissness” bei Uhren, 17 June 2016).

The following transitional rule applies:

  • Until 31 Dezember 2018 watch cases and watch glasses must not be included in the calculation of the manufacturing costs, if the respective cases and glasses were already on stock at the moment at which the revised Ordinance entered into force, i.e. 1 January 2017.

This transitional rule ensures that manufacturers may reduce inventory that complies with the current Ordinance.

Enforcement of the Swissness Requirements

The use of “made in Switzerland” claims will not be subject to an approval or permission (see already BR-News of 16 February 2016). The geographic origin “Switzerland” and any related claims may be used, as long as the Swissness requirements are complied with.

Compliance with the Swissness requirements will not be enforced by governmental bodies. It is rather expected that industry organizations will have an interest in proper compliance and therefore assist in enforcing the Swissness provisions.

Additional Information (only in German):

Contact: Michael Reinle

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