- In today’s globalized world, estates increasingly encompass assets located in different jurisdictions. This gives rise to complex legal questions as e.g. which authorities have jurisdiction over assets and which law is applicable to the respective assets. Due to Switzerland’s position as a leading international financial center Swiss lawyers and courts are often confronted with cases regarding assets belonging to international estates.
- Hence, the authors will give hereinafter an overview on the jurisdiction of Swiss courts and authorities in international estate matters. They also highlight some important conflicts of jurisdiction with foreign jurisdictions respectively the mutual competences in relation to prime jurisdictions.
B. International Jurisdiction of Swiss Courts and authorities
I. Legal Basis
- The international jurisdiction of Swiss courts and authorities over estates linked to foreign countries is governed by the Federal Law on International Private Law (FLIPL). This statute basically applies if the Swiss decedent was residing abroad at the time of his/her death or if he/she was a foreign national and lastly resided in Switzerland.
- However, treaties generally precede the FLIPL. Hence, if a treaty containing jurisdiction rules exists between Switzerland and the foreign state of residence or country of origin of the decedent , these rules apply. Such treaties exist inter alia with the United States of America and Italy.
- The Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (the “Lugano Convention”) is by way of contrast not applicable since the Convention shall not apply to wills and succession pursuant to the Convention’s art. 1 para. 2 (a).
- Since Switzerland is not a member of the European Union, the Regulation (EU) No. 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession is also not applied by Swiss courts and authorities. Nevertheless, this regulation will have a remarkable impact on the handling of international estates in Switzerland following its full entry into force since the application of these rules by EU member states may lead to conflicts of jurisdiction with Switzerland.
II. Principle of Residence
- Pursuant to the general rule of art. 86 FLIPL, Swiss authorities are competent to handle the whole estate irrespectively of whether the estate assets are located in Switzerland or abroad if the decedent had his/her last residence in Switzerland. This even applies for foreign decedents having resided in Switzerland. However, if a foreign state claims exclusive jurisdiction over realties located in its territory, Swiss courts are not competent for these realties.
- The decedent’s country of residence is defined as the state where the decedent resided with the intent of continual stay.
- Hence, if a Swiss or foreign national dies with last residence in Switzerland, Swiss courts and authorities are basically competent for all estate assets even if no estate assets are located in Switzerland. This principle often creates conflicts of jurisdiction with countries assuming jurisdiction over estates of their citizens or for moveable estate assets located in their territory.
III. Jurisdiction of Place of Origin
- In the event that a Swiss national dies with last residence in a foreign country (and the Swiss authorities are therefore not competent pursuant to art. 86 FLIPL), Swiss courts and authorities may be competent based on the place of origin jurisdiction according to art. 87 FLIPL.
- 1 of this article provides for jurisdiction of the Swiss courts and authorities of the decedent’s Swiss place of origin insofar as no foreign authorities handle the decedent’s estate assets. So, this is a subsidiary jurisdiction coming into play if foreign countries only assume jurisdiction over assets located in their territory.
- Further, para. 2 of art. 87 FLIPL stipulates the decedent’s option to choose jurisdiction of his Swiss place of origin by way of dispositions of will. The decedent may opt for this Swiss jurisdiction regarding his assets located in Switzerland or his whole estate. In the latter case an exclusive jurisdiction of a foreign country for realties is however reserved.
- Consequently, art. 87 FLIPL may lead to conflicts of jurisdiction with countries assuming jurisdiction based on a Swiss national’s last residence in their territory.
IV. Forum Rei Sitae
- Swiss courts and authorities are generally not competent to handle estate assets of foreign nationals with last residence abroad. Nevertheless, as an exception, they have jurisdiction over assets located in Switzerland if no foreign authority assumes jurisdiction over these assets. This rule shall prevent that these assets remain unsettled in cases where the other involved countries’ jurisdiction is limited to assets located in their territories.
- The Swiss forum rei sitae is further competent to issue any protective measures with regard to estate assets located in Switzerland of a decedent with last residence abroad.
C. Conflicts of jurisdiction / Mutual Competences in relation to prime jurisdictions
- The Federal Republic of Germany assumes jurisdiction for the whole estate of German nationals, regardless whether they lastly resided in Germany or abroad. So, if a German decedent dies with residence in Switzerland, Germany as well as Switzerland are competent. Since only realties are excluded from Switzerland’s jurisdiction, there are conflicting competences for all other assets wherever located. This is in particular problematic since German authorities apply German inheritance laws whereas the Swiss authorities basically implement Swiss laws and decisions of German courts are not recognized and enforced by Swiss authorities under these circumstances.
- However, upon the EU Regulation No. 650/2012 entirely entering into force (the Regulation is applicable to estates of decedents dying on or after 17 August 2015), Germany’s jurisdiction over estates is defined pursuant to the criterion of the last habitual residence of the decedent. Since it is not clarified whether the term “habitual residence” is identical to the “residence” according to Swiss laws, there might still result conflicting competences. Furthermore, the Regulation stipulates subsidiary competences based on the location of estate assets and the decedent’s nationality which can lead to conflicts of jurisdiction with Swiss courts and authorities.
II. United Kingdom
- All estate assets being located in the United Kingdom (UK) are part of an UK estate, regardless whether the decedent’s last residence was in UK or abroad. If the decedent had last residence in Switzerland, but moveable assets in UK, a conflict of jurisdiction between UK and Switzerland results since Switzerland assumes jurisdiction for moveable assets wherever they are located. Consequently, under these circumstances UK as well as Switzerland have jurisdiction for moveable assets in UK. Again, UK decisions with regard to these assets are basically not recognized and enforced in Switzerland unless the decedent was a British citizen (and not a Swiss dual citizen) and has chosen UK laws to be applied to his/her estate.
III. United States
- As mentioned above, there is a treaty in place between Switzerland and the United States of America regulating the mutual competences of Switzerland and USA. Swiss courts generally interpret this treaty as follows: Inheritance disputes regarding moveable assets are to be handled by the courts of the decedent’s last residence whereas disputes with respect to realties are submitted to the jurisdiction of the realties’ location. Furthermore, the competent court shall apply the laws of its jurisdiction (lex fori).
- Hence, if, for example, the decedent had his/her last residence in the US, any of his/her Swiss realties are basically to be handled by Swiss courts and authorities applying Swiss inheritance laws. In contrast, moveable assets located in Switzerland have to be settled by US courts resp. executors.
- The administration and handling of estates involving assets in several jurisdictions often require advice by local counsels. This is specifically true if the estate resp. the decedent has any relevant connection to Switzerland which may trigger jurisdiction of Swiss courts and authorities. Ideally, the decedent tackles such potential jurisdiction issues in the course of his/her estate planning since respective dispositions by will can prevent some of the conflicts of jurisdiction complicating the administration of the future estate.