A shift in global power dynamics has pushed many countries to rethink how open they should remain to outside capital. Switzerland is now moving toward tighter oversight, aiming to protect companies that play an essential role in the country’s stability.
The decision has drawn attention across Europe, especially as governments weigh how foreign ownership may influence security, supply chains, and long-term economic control.
Stronger Rules to Protect Security
Swiss lawmakers approved plans that would expand government authority over specific foreign investments. The proposal centers on the Investment Review Act, informally called “Lex China.” Under this framework, deals involving foreign state-controlled buyers would face mandatory review and approval. The intention is to block acquisitions that could threaten public order or national security.
The measure is expected to receive its final parliamentary vote later this month. If it passes without a referendum challenge, it may come into effect as early as next year.
Key elements of the act include:
1. Mandatory scrutiny for transactions involving state-backed foreign entities
2. Government power to intervene in deals viewed as high-risk
3. A targeted scope rather than a blanket review of all foreign investment
Why Switzerland Is Tightening Oversight Now
Instagram | ghassan_awwad | The unresolved Nexperia case in the Netherlands fuels debate on securing European chip access.
Concerns around foreign influence on strategic assets have intensified across Europe. Questions over control of critical technologies and supply chains have become more urgent, pushing governments to adopt stronger screening tools.
A recent case in the Netherlands added fuel to the debate. In October, Dutch authorities took control of Nexperia, a Chinese-owned semiconductor company, to ensure Europe retained uninterrupted access to its chip production. While the order was suspended last month, the situation remains unresolved and continues to influence policy discussions.
The European Union is also preparing its own rules to safeguard local industries from potentially risky foreign takeovers—moves widely viewed as responses to China’s expanding global footprint.
A Decade in the Making
Switzerland’s conversation over investment screening stretches back nearly ten years. The catalyst was the $43 billion takeover of Syngenta AG, a major Swiss agri-chemical company, by ChemChina (now part of Sinochem). That deal sparked debate over whether the country should introduce more guardrails around foreign acquisitions.
Early discussions considered placing all foreign investments under review. Lawmakers ultimately refined the plan, choosing instead to focus on transactions involving foreign government-backed buyers and only under certain conditions.
Parliament Overrides Government Stance
Instagram | guyparmelin | Parmelin opposed mandatory screening, warning global openness is key to Swiss economic strength.
The move marks a rare instance in which parliament diverged from the Swiss government’s stance. Economy Minister Guy Parmelin had argued against mandatory screening, warning that Switzerland’s economic strength depends heavily on openness to global capital. He emphasized that restrictive rules could undermine the country's appeal as a competitive business hub.
Despite this, lawmakers pushed forward, citing increasing concerns over security and strategic autonomy.
What This Could Mean for Future Deals
The upcoming shift signals a more guarded approach toward ownership of critical industries in Switzerland. While the act targets a narrow category of investors, it reflects an expanding global trend: countries are carefully reassessing who gains access to sectors tied to technology, infrastructure, and essential resources.
Businesses involved in high-value mergers may soon need to factor in longer timelines, additional documentation, and the possibility of government intervention.
Switzerland’s move to tighten controls on foreign state-backed investments highlights a growing effort to safeguard strategic assets in an uncertain geopolitical environment. The Investment Review Act places national security at the forefront while reshaping how sensitive cross-border transactions will be evaluated in the years ahead.