Unfair Competition Law

The primary regulation governing advertising practices is the Swiss Unfair Competition Act. The Unfair Competition Act (UCA) sets out (amongst others):

• the basic applicable rules, such as the general transparency principle in commercial communication;
• the prohibition of inaccurate, deceptive or misleading advertising claims about other companies and their products (Article 3 paragraph 1 littera a, UCA) or one's own products and services (Article 3 paragraph 1 littera b, UCA);
• requirements for comparative advertising (Article 3 paragraph 1 littera e, UCA);
• requirements for below-cost offers and the advertising related thereto (Article 3 paragraph 1 littera f, UCA);
• requirements for offers with premiums and the advertising related thereto (Article 3 paragraph 1 littera g, UCA);
• requirements for email marketing (Article 3 paragraph 1 littera o, UCA);
• certain requirements for sweepstakes and contests (Article 3 paragraph 1 littera t, UCA); and
• requirements for telemarketing (Article 3 paragraph 1 littera u, UCA).

Advertising-Related Provisions in Other Statutes

Other relevant laws are:

• the Trademark Act (when displaying trade marks of third parties in advertising);
• the Copyright Act (when displaying pictures or videos of third parties in advertising); and
• legislation dealing with personality rights and data protection (when displaying pictures of individuals or processing personal data for marketing purposes).

Rules for specific industries, products or services

The most relevant industry-specific regulations are set out in 10.1 Regulated Products.

Soft Law and Self-Regulation

Finally, there is soft law created by industry organisations and non-profit organisations.

The most important soft law regarding advertising are the so-called principles of the Swiss Fair Competition Commission (Lauterkeitskommission) regarding commercial communication.

These principles include, amongst others, requirements for the use of test results in advertising and requirements for direct marketing. The principles are non-binding and not enforceable like statutes. However, the Commission may render decisions, which are published and may affect the reputation of the offender.

Whereas the sector-specific regulations are often enforced by the respective supervisory authorities, the more general advertising regulations are enforced as set out below.

Cantonal Civil Courts

The UCA, and the other regulations mentioned in 1.1 Primary Laws and Regulation, such as the Trademark Act and the Copyright Act, provide for civil law remedies, which are enforced by cantonal civil courts.

Article 9 paragraph 1 of the UCA sets out that claimants can request the civil courts to:

• prohibit imminent infringements of the UCA;
• have existing infringements of the UCA removed (eg, by removing promotional materials with illegal claims from the market, including from websites); and
• declare a behaviour illegal if it should continue.

Claimants may also ask for damages (Article 9 paragraph 3, UCA).

It is generally possible to request preliminary injunctions against alleged infringers. However, the requirements for such preliminary injunctions are rather strict under Swiss law.

Cantonal Criminal Authorities

The UCA and the other general regulations mentioned in 1.1 Primary Laws and Regulation provide for criminal sanctions in the case of an infringement, which are enforced by the cantonal criminal authorities.

Article 23 of the UCA sets out that intentional infringement of Article 3 of the UCA (among other provisions) is sanctioned with imprisonment of up to three years or a monetary penalty of up to CHF540,000. There are no decisions available in which a prison sentence was handed down.

The competent criminal authorities are those of the Swiss canton in which the criminal conduct has taken place or where the effect of the criminal conduct arose.

Criminal courts only initiate investigations based upon complaints by competitors, consumer organisations or consumers with the capacity to sue in the sense of Articles 9 and 10 of the UCA.

Swiss Fair Competition Commission

The Commission enforces its own principles (see 1.1 Primary Laws and Regulation). The proceeding is rather streamlined, including template complaint forms and the absence of oral hearings. It is initiated upon request and ends with a non-binding decision. The decisions are published.

Civil Law Actions

In the case of civil law litigation, the legal entity will be held liable where an employee or director, in the course of the business activities of the entity, committed the infringement.

However, the UCA also permits litigation against individuals if no legal entity is involved or if an employee or director acts outside of their business activity (eg, if a director posts deceptive claims about a competitor on its private Twitter account). This is a grey area.

Civil litigation can also be initiated against third parties. Injunctions and deletion requests are not dependent on culpability. Therefore, a claimant may ask, for example, an advertising agency or hosting provider to cease displaying deceptive advertising. The most important issue in claims against third parties is often whether they are effectively in control of the infringing activities (ie, whether they have the competence to stop, for example, deceptive advertising).

Criminal Law Actions

Criminal law actions are always directed against individuals. The individual who is responsible for the criminal conduct will be liable.

If criminal conduct is committed in the course of the business activities of a legal entity, it is often not that easy to determine the responsible individual. In that case, criminal authorities often investigate the directors or employees who were in charge of marketing decisions in the first investigation phase.

Criminal proceedings are not often directed against third parties, unless the investigations reveal that such third parties might, in effect, be more responsible than the directors or employees of the advertiser. Third parties are sometimes the focus of investigation if the advertiser has its registered seat outside of Switzerland and is therefore outside of the territorial scope of Swiss criminal law enforcement.

As mentioned in 1.1 Primary Laws and Regulationand 1.2 Enforcement and Regulatory Authorities, the Swiss Fair Competition Commission is one of the most important self-regulatory organisations governing and enforcing advertising rules.

As the fees for the proceeding with the Commission are generally zero or rather low (compared to court fees), companies and individuals often file their complaints with the Commission instead of civil courts.

Other industry-specific self-regulation is covered in 10.1 Regulated Products.

Whether consumers/private citizens have a private right of action depends on the infringed provisions/statutes.

In the case of an infringement of the trade mark or copyright statutes, only the owners of the respective trade mark rights and copyrights have a private right of action. The available remedies are injunctions, removal of infringements, or damage claims.

In the case of an infringement of data privacy laws, the data subject has a private right of action. They can ask to have the data processing prohibited or blocked, or to have personal data deleted (see Article 15, DPA).

In the case of an infringement of the UCA, consumers/citizens have a private right of action if their economic interests are threatened or damaged by unfair behaviour (Article 9 paragraph 1, UCA). Remedies would mainly be injunctions, deletion requests and damage claims (see 1.2 Enforcement Regulatory Authorities).

The case law of the Swiss Fair Competition Commission reveals a significant increase in cases dealing with green marketing.

A new approach can be seen regarding the enforcement against deceptive advertising in connection with foodstuff and cosmetics. Article 18 of the Federal Statute on Foodstuffs and Utility Articles prohibits the use of deceptive claims in advertising. As foodstuff and cosmetics are regularly sold online, there is a trend that users of the respective platforms or online-shops are invited to submit comments on products. There is a debate on whether the seller of these products is responsible for deceptive statements in such comments. Swiss law does not know a general liability of platform operators or online-shop operators. However, certain cantonal authorities decided that such a responsibility cannot entirely be excluded. In case that this opinion would be accepted by higher courts, it would substantially affect the platform and online-shop operators. The operators would be forced to control the content of comments.

The following cases are noteworthy.

Viagogo II

In its decision of 27 October 2021, the Federal Supreme Court had to decide whether certain marketing claims and activities by a ticket exchange platform constituted deceptive advertising in the sense of Article 3 paragraph 1 littera b of the UCA (BGer 4A_314/2021). It must be emphasised that the Federal Supreme Court did only assess the claims which were brought forward in the appeal. The case dealt with tickets for a circus show. The claimant was the operator of the circus for which the tickets were offered on the ticket exchange. The Federal Supreme Court upheld the decision of the lower court that the ticket exchange platform infringed Article 3 paragraph 1 littera b of the UCA in several ways. The ticket exchange platform infringed the UCA by claiming that certain shows of the circus were already or almost sold out even though there were still tickets in the official sales channels. The court held that the claim “sold out” could be understood by the users in the specific situation in the way that tickets are not only sold out on the ticket exchange, but also in official sales channels. The Court considered the other advertising claims of the ticket exchange in the same way, such as the claim that it sells tickets that can no longer be purchased in other sales channels. In addition, the high prices for the tickets on the ticket exchange also communicated a scarcity of the respective tickets. Furthermore, the ticket exchange infringed the UCA by using price category descriptions and by publishing seating plans which did not correspond to the ones used by the circus itself. The ticket exchange claimed that the respective information was not provided by the ticket exchange, but rather by the sellers of the tickets. The Court rejected this argument and decided that it was the ticket exchange that determined the information to be provided by the sellers and to be displayed on the platform to a rather extensive degree. Moreover, the ticket exchange violated the UCA by increasing the price for the tickets gradually during the order process without displaying the effective total price in a transparent manner and without granting the user more than three minutes to take the purchase decision. In that regard the Court held that the UCA was also infringed by the displaying of claims and pop-up banners that suggested a substantial demand or a rare offer (“there are two other users in the waiting list for these tickets”) without mentioning that these statements only apply to the ticket exchange and not to other sales channels. Finally, the countdown displayed to finalise the order process was less than ten minutes. 

Swiss Meat

In a decision of 23 March 2022, the Swiss Fair Competition Commission had to assess whether the campaign “Schweizer Fleisch – der feine Unterschied (Swiss Meat – the fine difference)” contained claims that constituted deceptive green marketing. Please note that an appeal against this decision is pending. The statement “cattle in Switzerland eat 91.5% domestic feed” is misleading in the Commission's view. The average reader assumes that “feed” refers to the totality of all feed fed to cattle in Switzerland. However, the so-called dry matter, to which the percentage figure referred, only covers a part of all feedstuffs. Moreover, this unit of measurement is not known to the average addressee. The link between feed and the percentage figure given is therefore misleading.

Biodiversity Claim

In a decision of 19 January 2022, the Swiss Fair Competition Commission had to assess a biodiversity claim in connection with milk products. The claim was “XY fosters and loves biodiversity”. The Commission rejected the complaint. The respondent was able to credibly demonstrate that the grazing of meadows by dairy cows contributes to the promotion of biodiversity. The average addressees could correctly place this statement in context and would also be aware that dairy farming, if intensively practiced, can also have negative effects on nature.

CO2 Emissions Claim

In a decision of 15 September 2021, the Fair Competition Commission had to decide whether advertising claims related to CO2 emissions were deceptive. The claim was “thanks to our modern fleet and efficient flight procedures, we have reduced our CO2 emissions by more than a third since 2000”. The complainant claimed that the average addressee would understand the statements to mean that total CO2 emissions had been reduced by ⅓ when comparing the years 2000 and 2001. However, the statement referred to passenger kilometres. The Commission rejected the complaint. It was declared sufficiently clearly that the statement of the reduction of CO2 emissions referred to passenger kilometres. There was therefore no danger of misleading the public.

The decisions of the Swiss Fair Competition Commission regarding green marketing are in line with the rather liberal understanding of Swiss case law as to the understanding of advertising claims by the average addressee.

The pandemic has generally not affected the regulation of advertising and the enforcement of advertising regulations.

However, Article 12 paragraph 1bis of the Ordinance on Foodstuff was implemented due to the pandemic and sets out that, by way of derogation from paragraph 1, indications on foodstuffs may deviate from the facts if the deviating claim is demonstrably due to supply shortages as a result of the COVID-19 pandemic (and if certain other requirements are met).

The political climate has not directly impacted the regulation of advertising or enforcement. However, due to the current political climate, environmental claims have become an important topic as companies try to emphasise the environmental or eco-friendly features of their products or services. At the same time, the risk of being blamed for “greenwashing” has increased.

The Swiss legislature has not yet reacted to this development. Environmental or ecological claims are legally assessed using the existing provisions, in particular the general provisions on inaccurate, misleading, or deceptive claims or certain provisions for specific products, such as chemical substances (see 1.1 Primary Laws and Regulation).

It is therefore suggested that companies consider the recommendations set out in the ICC Framework for Responsible Environmental Marketing Communications (2019) when planning and implementing environmental marketing.

According to the case law and literature, how the advertiser itself understands or interprets the claims made in an advert is not decisive. Rather, it is the content or meaning attributed to a claim by the average addressee, taking into account all the circumstances of the case.

The understanding of the average addressee is determined in three steps:

• determining the addressees to whom the information is directed (eg, age, social position, location);
• clarifying the knowledge and skills of the average addressee represented by the target group, including their education, language skills, previous knowledge or understanding, low level of knowledge (eg, among young people or children) and attention (eg, type of claim, place of claim, advertising medium and advertising situation); and
• assessing how the average addressee (an artificial construct) understands the claims.

Because the assessment of whether a claim is misleading, deceptive or inaccurate requires an objective understanding, “misleading or inaccuracy rates”, which are calculated empirically or by means of surveys, are not used under Swiss law.

Furthermore, the understanding of the average addressee cannot be proven by means of representative surveys. This also results from the fact that the determination of the objectified understanding is a legal question. However, surveys submitted by the claimant may nonetheless affect the assessment by the judges.

The Unfair Competition Act, in particular Article 3 paragraph 1 littera b, may cover both express and implied claims.

Whether an implied communication is a claim in the sense of the UCA must be assessed based on the understanding of the average addressee (see 2.1 Deceptive or Misleading Claims) in the instance in question.

In terms of content, the claim should contain a verifiable factual statement, which is assessable with evidence. Statements that cannot be objectively measured do not constitute a claim in the sense of Article 3 paragraph 1 littera b of the UCA.

Pure value judgements do not qualify as claims in the sense of Article 3 paragraph 1 littera b of the UCA. However, whether the value judgement contains any factual statements at all must be assessed. The understanding of the average addressee is, again, decisive.

Claim substantiation depends on the nature of the claim in question. Substantiation for misleading claims is different than substantiation for inaccurate claims.

As mentioned under 2.1 Deceptive or Misleading Claims, it is decisive whether the (hypothetical) average addressee is deceived or misled, or whether a claim is inaccurate. The standard is therefore, for example, not whether a substantial part of the addressees might be misled.

In ordinary proceedings, the court must be convinced, based on the evidence submitted, that an infringement is highly probable (almost 100% probability). The courts assess all evidence with full discretion. There is no hierarchy of evidence under Swiss law.

In cases of preliminary injunctions, the claimant must convince the court that an infringement is plausible. However, Swiss courts tend to apply a rather high standard (ie, it must also be highly probable).

There are requirements for tests set out by the Swiss Fair Competition Commission.

The Swiss Fair Competition Commission sets forth in its guidelines for tests the following important requirements (only available in German, French and Italian).

• Independence – the testing institute must be independent from the claimant/advertiser and other third parties.
• Competence – the testing institute must have the necessary skills and experience to execute the tests.
• Objectivity – the tests must not be deceptive, misleading or inaccurate; it is, for example, prohibited to ignore important data in the test result.

Only consumer-relevant properties should be tested; the test criteria should be weighted appropriately.

Whether human clinical studies are required depends on the type of claim. If advertising refers to clinical studies (eg, in advertising for medicinal products or cosmetics), respective studies must have been executed according to the rules of good clinical practice.

The Federal Statute on Research with Human Beings, and the ordinances thereto, set out further requirements for such clinical studies.

There are no special laws in that regard. The same general provisions as mentioned under 1.1 Primary Laws and Regulation apply.

Environmental or ecological claims are legally assessed using the existing provisions, in particular the general provisions on inaccurate, misleading, or deceptive claims or certain provisions for specific products, such as chemical substances (see 1.1 Primary Laws and Regulation).

It is therefore suggested that companies consider the recommendations set out in the ICC Framework for Responsible Environmental Marketing Communications (2019) when planning and implementing environmental marketing.

However, certain environmental claims are specifically regulated in connection with foodstuffs. According to the Ordinance on Organic Farming and the Labelling of Organically Produced Products and Foodstuffs, products and foodstuffs may only be claimed as “bio” or ecological if they are produced under the requirements set out in the ordinance. For bio-claims in connection with other products, the general rules of the Unfair Competition Act apply (ie, the claims must not be deceptive, misleading, or inaccurate).

In addition, Article 60 of the Ordinance on Chemical Substances prohibits the use of general, vague and undefined statements about the health or environmental friendliness of a chemical substance such as “non-toxic”, “not harmful to health”, “not harmful to the environment”, “environmentally friendly”, “without emissions”, “ozone-friendly”, “biodegradable”, “ecologically safe”, “ecological”, “environmentally safe”, “nature-friendly” or “water-friendly” without any further explanation. Claims regarding biodegradability must contain information regarding the testing method used and the percentage of degradability. Furthermore, it must be indicated which part of the product is degradable in case the claim does not apply to the entire product.

In its supervisory communication 05/2021 on preventing and combating greenwashing, the Swiss financial market authority (FINMA), provides information on the main features of its expectations and the current state of practice in the management of collective investment schemes with a sustainability focus at fund and institution level. In addition, it draws the attention of financial service providers offering sustainability-related financial products to the potential greenwashing risks in the advisory process and at the point of sale.

There are types of claims that are subject to specific rules or regulations. However, the respective regulations are incorporated into different statutes and ordinances. Whether specific regulations apply to concrete types of claims must therefore be assessed on a case-by-case basis.

Examples of such regulations are set out below.

The Tobacco Ordinance

Article 17 paragraph 3 of the Tobacco Ordinance prohibits claims that give the impression that a particular tobacco product is less harmful than others (eg, “light”, “ultra-light” or “mild”).

Health-Related Claims

These are generally prohibited for any products other than medicinal products. However, Annex 14 of the Ordinance on Foodstuffs Information includes specific permitted health-related claims for foodstuffs.

Ordinance on Chemical Substances

Article 60 of the Ordinance on Chemical Substances prohibits the use of general, vague and undefined statements about the health or environmental friendliness of a chemical substance such as “non-toxic”, “not harmful to health”, “not harmful to the environment”, “environmentally friendly”, “without emissions”, “ozone-friendly”, “biodegradable”, "ecologically safe”, “ecological”, “environmentally safe”, “nature-friendly” or “water-friendly” without any further explanation. Claims regarding biodegradability must contain information regarding the testing method used and the percentage of degradability. Furthermore, it must be indicated which part of the product is degradable in case the claim does not apply to the entire product.

Swissness Provisions

The so-called Swissness provisions in the Trademark Act (Articles 47 et seq) and the ordinances thereto govern the use of Swiss claims, Swiss symbols and other Swiss indications of origin. The use of the Swiss flag is further regulated in the Coat of Arms Act.

The use of Swiss indications of origin must, in general, not be deceptive. Consequently, the Swissness rules set out when a product is considered to have been manufactured in Switzerland or when a service is sufficiently “Swiss”. With regard to foodstuffs, 80% of the content must be of Swiss origin. There are, however, exceptions. Regarding industry products, at least 60% of the manufacturing costs must arise in Switzerland. The ordinance clarifies how to calculate the manufacturing costs.

Comparative advertising is generally permitted as it improves market transparency and therefore competition.

However, comparative advertising is prohibited where it is executed in an inaccurate, misleading, unnecessarily disparaging or unnecessarily imitating manner, or favours third parties in competition in a corresponding manner (Article 3 paragraph 1 littera e, UCA).

It is generally permitted to identify a competitor by name in the advertising – as long as the advertising complies with Article 3 paragraph 1 littera e of the UCA. However, identification of a competitor may affect the assessment of whether a comparison is inaccurate, misleading, etc.

Article 3 paragraph 1 littera e of the UCA even applies if no specific competitor is mentioned (indirect comparison). It is sufficient that the advertiser's own products and services are compared, even implicitly, with other specified or specifiable products and services.

There are no different standards for comparative advertising. The understanding of the average addressee (see 2.1 Deceptive or Misleading Claims) of the comparative advertising is decisive.

As discussed in 1. Legal Framework and Regulatory Bodies, advertisers or competitors affected by comparative advertising may challenge claims in civil litigation, criminal law proceedings, or with a complaint to the Swiss Fair Competition Commission.

In civil litigation, the claimant can request injunctions, deletion or removal of illicit claims, and damages (Article 9, UCA).

In criminal proceedings, the criminal authorities will investigate and impose sanctions, which are imprisonment for up to three years or a monetary penalty of up to CHF540,000 (Article 23, UCA).

In proceedings before the Swiss Fair Competition Commission, the Commission may decide that the advertising is illegal and should therefore cease or be removed. The Commission has no authority over damage claims.

There is no specific statute dealing with advertising in social media.

The general provisions, mentioned in 1. Legal Framework and Regulatory Bodies, apply.

Furthermore, principle B.15 paragraph 1 of the Swiss Fair Competition Commission requires that advertising for third parties in posts on social media platforms must be recognisable as advertising.

It should be noted that the addressees of advertising on digital media might differ from the addressees of advertising on other communication channels (see the discussion regarding the average addressee in 2.1 Deceptive or Misleading Claims). This was emphasised by the Swiss Fair Competition Commission in decisions regarding influencer marketing on Instagram. It mentioned that the addressees of the respective posts were the followers of the Instagram account of the respondent. The average addressee was described as follows: “a follower decides for themselves which persons or companies they want to follow. It can be assumed that the average Swiss followers of the respondent's account are interested in the respondent's sports history and life. A follower wants to learn more about the respondent, their career and life by following the Instagram account. They are more interested in and better informed about the respondent than someone who is not a follower of the account”. See, for example, appeal decision of 6 May 2020 (No 154/19 and 159/19), reference No 14.

Finally, the understanding of the average addressee is dependent on the context of the advertising claim. The Swiss Fair Competition Commission explicitly mentions this consideration: “when assessing a commercial communication, the Commission takes particular account of the understanding of the relevant target group, the overall impression and the character of the medium” (principle A.1 (3)).

One of the main challenges facing advertising on social media is the fact that claims tend to be shorter than in other communication channels. This increases the risk of an infringement of the general transparency principle. It also increases the risk of inaccurate, deceptive or misleading advertising.

In addition, it is a challenge that the advertiser cannot control the context in which its claims are further distributed in social media.

Another challenge is the so-called “separation principle” (ie, that commercial communication must be recognisable as such and separated from other communication).

Injunction and deletion claims are generally independent of the culpability of the advertiser. Consequently, an infringed individual or legal entity may initiate litigation against the advertiser and ask them to stop the posting of third-party content on the advertiser's website or social media channels, and to have it removed.

In contrast, damage claims are generally not available against an advertiser for illicit third-party content. However, if the advertiser was notified about the illicit content and did not remove it, the advertiser could become culpable (jointly with the main infringer) for the illicit post. In that case, a damage claim might be possible.

There are generally no special requirements for disclosure regarding advertising on social media as opposed to traditional media. However, the implementation of the disclosure requirements may differ. These must be assessed on a case-by-case basis.

There are no unique rules or regulations that apply to the use of the major social media platforms.

However, principle B.15 of the Swiss Fair Competition Commission makes concrete certain general principles as set out in the UCA for social media platforms (see 4.6 Special Rules for Native Advertising).

Principle B.15 of the Swiss Fair Competition Commission sets out special rules regarding the separation of commercial communication from editorial content. Commercial communication must be recognisable as such and must be strictly separated from editorial content. Commercial communication must be flagged as sponsored/advertising or similar.

The Swiss Fair Competition Commission has applied principle B.15 in cases of native advertising.

There are no laws that specifically apply to misinformation on topics of public importance. However, the following regulations may cover certain aspects of misinformation/fake news.

• If fake news or misinformation includes defamatory or libellous statements, the criminal code provisions dealing with the reputation of individuals can be triggered (see Articles 173 and 174, Criminal Code). However, one of the difficulties regarding criminal law actions is the fact that often social bots are used for misinformation campaigns. It is difficult to identify the person responsible for operating the social bots.
• The Unfair Competition Act does generally not deal with influencing the political climate. The UCA is only applicable if the misinformation is directed against specific market players.
• Social media content is generally not subject to the Federal Statute on Radio and Television (RTVG). However, social media appearances of certain media companies, such as the Federal Television Company (SRG), can be subject to the provisions of the RTVG (see Article 5a, RTVG).
• Fake news and misinformation in radio and television infringes the principle of proper presentation of facts and events (see Article 4 paragraph 2, RTVG).

In a report of 10 May 2017, the Federal Communication Agency (BAKOM) came to the conclusion that there is an increased risk of misinformation, fake news and hate speech on social media. BAKOM held that the existing legislation is not sufficient to deal with these increased risks and suggested legislative actions to the Federal Council.

In November 2021, BAKOM issued a new report on the activities of platform operators in the field of public communication and opinion-forming. The report explored the question of how the behaviour and use of platforms by the public affects public communication in Switzerland and the formation of opinion among the Swiss population. The report concludes that existing regulation in Switzerland is hardly up to the new trends. The Federal Council has instructed the relevant Federal Department to show in a debate paper by the end of 2022 whether social media platforms can and should be regulated, and, if so, how to regulate it. A broad discussion is then planned on the question of the social integration and governance of intermediaries in Switzerland.

Decisions of the Swiss Fair Competition Commission regarding influencer marketing reveal a rather liberal approach. The Commission decided that no specific disclaimer (“ad”, “sponsoring”, etc) is needed if the nature of a post as commercial communication is recognisable without such a disclaimer (see, for example, appeal decision of 6 May 2020 (No 154/19 and 159/19), reference No 14; decision of the second chamber of 6 May 2020, No 201/19).

However, the Commission emphasised that a case-by-case approach is needed. The mentioned decisions dealt with the posts of famous athletes and a famous influencer. According to the Commission, users are aware that posts of such individuals contain commercial communication.

Principle B.15 paragraph 2 of the Swiss Fair Competition Commission specifically deals with influencer marketing.

In addition to the general separation and transparency principle, it sets out that it is unfair to use social media accounts in order to facilitate commercial communication in favour of third parties, unless the commercial nature of such posts is made transparent. Individuals who receive sponsor donations or similar compensation for posts must make this commercial relationship transparent.

There is no case law in respect to advertisers being held responsible for content posted by their influencers. However, the applicable rules in cases of influencer marketing are generally directed against the immediate infringer, (ie, the influencer). In the cases decided by the Swiss Fair Competition Commission (see 5.1 Trends in the Use of Influencer Campaigns), the respondent was always the influencer.

There is currently no case law regarding misleading/fake reviews in Switzerland. The topic is, however, discussed in the legal literature.

The main provision dealing with misleading/fake reviews is Article 3 paragraph 1 littera b of the UCA. The provision sets forth that anybody who “makes false or misleading statements about themselves; their company; their business name; their goods; works or services; their prices; the quantity in stock; the type of sales event; or about their business relationships, or in a corresponding manner favours third parties in competition (highlighted by the authors)”, acts in an unfair manner.

An employee of a company or an influencer or agency who makes deceptive, misleading or inaccurate claims in product reviews favours the company in competition.

Data Privacy Laws

The collection of email addresses is subject to the Swiss Data Protection Act (DPA). According to Article 4 of the current DPA (Article 6, revised DPA), the data collection must be transparent (ie, it must be recognisable to the data subject that email addresses are collected and processed for marketing purposes).

Information or notices are therefore required. Unless the general data processing principles (transparency, purpose limitation, proportionality) are infringed, no extra conditions, such as consent, need to be met based on data privacy laws (see below, however, regarding the UCA). Consent is needed if email addresses are disclosed to third parties for marketing purposes in favour of that third party.

Please note that the General Data Protection Regulation (GDPR) might apply to entities with a registered seat in Switzerland (Article 3 paragraph 2, GDPR). The GDPR might therefore affect data collection and processing for email marketing. As this chapter focuses on Swiss law, there will be no further evaluation of the GDPR requirements for email marketing.

Unfair Competition Act

Article 3 paragraph 1 littera o of the UCA deals with email marketing. It generally requires an opt-in of the recipient for email marketing. The recipient must also be informed about the option to unsubscribe. Finally, the sender must indicate its correct name and address.

There is an exemption from this general rule with respect to existing customers. Opt-in is not necessary for email marketing to recipients in cases where they have been informed prior to the first marketing mail about the opt-out right, and in cases where the emails contain information about the company's own products or services, which are similar to the ones purchased or ordered by the respective recipient.

Sanctions

The current Swiss Data Protection Act does not provide for monetary sanctions in the case of an infringement; however, exceptions exist in a few instances, which are not that relevant in connection with email marketing. However, the Federal Data Protection and Information Commissioner (FDPIC) may investigate data processing activities upon request and render non-binding recommendations, such as to cease the data processing. If the data controller is not willing to accept the recommendation, the FDPIC may file a complaint with the Swiss Federal Administrative Court. Data subjects may also initiate civil litigation and ask for injunctions (see Article 15, current DPA; Article 32, revised DPA and 1.5 Private Right of Action for Consumers). As the court fees may be quite substantial, data subjects tend to file complaints to the FDPIC.

In case of an infringement of Article 3 paragraph 1 littera o of the UCA, the affected individual may file a complaint with the civil court and ask for an injunction and for removal of their mail address from the mailing list (Article 9, UCA). Damage claims are rare, as the claimant has to prove effective financial damage. No such civil litigation is on record. There are a few criminal proceedings dealing with infringement of the UCA. Intentional infringement of Article 3 paragraph 1 littera o of the UCA is sanctioned with imprisonment for up to three years or a monetary penalty of up to CHF540,000 (Article 23, UCA). Prison is not realistic for such infringements, but penalties might be awarded. However, in the published case law, the criminal authorities have followed a rather liberal approach.

Swiss Fair Competition Commission

Principle C.4 paragraph 2 No 5 and paragraph 3 repeat Article 3 paragraph 1 littera o of the UCA. Consequently, complaints against illicit email marketing can also be filed to the Swiss Fair Competition Commission. The Commission acts upon the request of competitors, recipients of the marketing communication or consumer organisations. It can decide that the marketing is illegal and must be stopped.

The Swiss Fair Competition Commission decides more cases of alleged illegal email marketing than the civil courts and criminal authorities.

In relation to internet-based telemarketing, the same rules as for email marketing apply (see 6.1 Email Marketing).

For other types of telemarketing, Article 3 paragraph 1 littera u of the UCA sets out that telemarketing to recipients with a respective opt-out notice in the telephone registry is prohibited. Sanctions for this infringement are the same as explained in 6.1 Email Marketing).

It is, however, permitted to address recipients with an opt-out in the registry if they have opted-in for specific telemarketing. An informed consent is needed.

Similar rules are included in the principle C.4 paragraph 2 No 4 of the Swiss Fair Competition Commission. The Commission has to deal with illicit telemarketing on a regular basis.

Marketing communication spread by means of text messaging is subject to the same rules as email marketing. See 6.1 Email Marketing.

General Remarks

The general rules for targeted/interest-based advertising are set out in the Data Protection Act. Whether additional rules apply must be assessed on a case-by-case basis. If the effective communication should take place in the form of (personalised) email marketing, the specific regulations regarding email marketing would apply as well (see 6.1 Email Marketing).

Data Privacy Law

The FDPIC has decided that web tracking or retargeting tools generally include data processing even though the tools only process IP addresses. The general data processing principles as set out in Article 4 of the current DPA (Article 6, revised DPA) apply.

• The data subjects must be informed of the data processing (ie, the collected data and the purpose of the processing).
• The data processing must be proportional (ie, only as much data as is necessary for the purpose may be collected and processed).
• Purpose limitation.

Consent is not needed. It is solely necessary if the personality of the data subject is infringed (Article 13, current DPA and Article 31, revised DPA).

Advertising Regulations

Marketing to children is prohibited with regard to certain products (alcohol, tobacco, etc). Otherwise, there are no specific rules. Yet, it should be taken into account that, for advertising that applies to children, the standard for review will be the average understanding of children.

Data Privacy Laws

With regard to the processing of personal data of children, there are no specific regulations. However, the fact that the personal data of children is collected must be taken into account in connection with the transparency principle. Information provided to children about data processing must be written in a way that is understood by children. If consent is needed for data processing, not only is consent from the children needed, but also approval from the parents in the case of minors.

General Requirements

The following requirements must be complied with regarding the conduct of sweepstakes and contests.

Data privacy laws

The processing of personal data in connection with sweepstakes or contests must comply with the data privacy laws. If personal data submitted by participants shall also be used for purposes other than the conduct of the sweepstake/contest, the participants must be informed about this other purpose and consent might be necessary – in particular for email marketing.

Unfair competition laws

Unfair competition laws require transparent information about the sweepstakes/contest, in particular about eligibility for participation, the participation period, how to participate, the prize, etc.

Trade mark and copyright laws

Trade mark and copyright laws must be considered if third-party trade marks and pictures are used, for example, for the description of the prize if it is a third-party branded product.

Swiss Gambling Act (Geldspielgesetz)

Sweepstakes and contests are most likely to be qualified as money games. The statute generally requires money games to have an approval/licence. However, certain sweepstakes and contests are excluded from the Gambling Act (see below).

Swiss Gambling Act

Sweepstakes and contests with free participation are most likely not within the scope of the Swiss Gambling Act. Approval is therefore not needed. However, the free participation option must provide the participants with an equal winning chance to that of paid participants. There is, however, so far, no decision in this respect.

Even if participation in a sweepstake or contest were not free (ie, if the participants had to purchase a product or conclude another contract in order to participate) the respective sweepstakes and contests could be exempted from the approval obligation. Short-term promotional lotteries and games of skill that do not involve the risk of excessive gambling, and where participation is exclusively through the purchase of goods or services offered at no more than market price, are exempted from the Swiss Gambling Act (Article 1 paragraph 2 littera d, Swiss Gambling Act).

The Swiss Gambling Act distinguishes between contests of skill and games of chance (lotteries).

Contests of skill are defined as money games in which the winning chance depends entirely or mainly on the skill of the player (Article 3 littera d Swiss Gambling Act). Money games are defined as games in which there is the prospect of a monetary gain or other monetary advantage in return for a monetary stake or the conclusion of a legal transaction (Article 3 littera a, Swiss Gambling Act).

Games of chance or lotteries are defined as money games which are open to an unlimited or at least a high number of people and where the result is determined by one and the same random draw or by a similar procedure (Article 3 littera b, Swiss Gambling Act).

Money games, including contests of skill and games of chance, are subject to an approval or licence (see Article 4, Swiss Gambling Act).

However, and as mentioned in 7.1 Sweepstakes and Contests, money games with free participation and certain sweepstakes and contests are exempted from these obligations. It is advisable and common practice to design promotional sweepstakes and contests in a manner that exempts them from the approval and licence duty.

Games of chance and contests of skill for promotional purposes must generally not be registered or approved if designed in a proper manner (see 7.1 Sweepstakes and Contents and 7.2 Contests of Skill and Games of Chance).

If such games or contests are not exempted from the Swiss Gambling Act, an approval or licence is needed.

With respect to the approval process, the statute distinguishes between large money games and small money games. Large money games are games of chances or contests of skill, which are executed in an automated manner, not only in one Swiss canton or online. Other contests and games of chance are small money games.

Large Money Games

Large money games must be approved by the inter-cantonal money game authority (Article 21, Swiss Gambling Act). Currently, the inter-cantonal authority is the Comlot. However, a new authority will soon be established, the inter-cantonal money game supervisory authority (GESPA).

Approval is subject to certain requirements, such as a registered seat in Switzerland, good reputation, financial stability, etc (Articles 22 and 24 et seq, Swiss Gambling Act). The main issue is that the cantons may determine the maximum numbers of organisers for money games. This means that an organiser might not receive an approval even if it complies with all requirements.

Small Money Games

Approval for small money games is granted by the cantonal authority in the canton in which the money game is executed (see Articles 32 et seq, Swiss Gambling Act).

Sanctions

The execution of money games without the necessary approval is subject to criminal sanctions. Articles 130 et seq of the Swiss Gambling Act distinguishes between large and small money games.

The intentional illegal execution of large money games is sanctioned with imprisonment for up to three years or a monetary penalty of up to CHF540,000.

The intentional execution of small money games without approval is sanctioned with a monetary penalty of up to CHF500,000.

Unfair Competition Laws

There is no special statute dealing with loyalty programmes. Such programmes must therefore comply in general with the Unfair Competition Act.

Which provisions in the Unfair Competition Act apply must be assessed on a case-by-case basis.

Data Privacy Laws

Data processing in connection with loyalty programmes must comply with the Swiss Data Protection Act, in particular with the general principles on data processing (Article 4, current DPA and Article 6, revised DPA).

Prohibition against Deceptive or Misleading Price Declarations

Article 3 paragraph 1 littera b of the UCA requires that information about prices must not be inaccurate, deceptive or misleading.

Furthermore, Article 18 of the UCA sets forth that the declaration of price reductions in a misleading manner is unfair.

Ordinance on Price Declaration

Article 18 of the UCA is concretised by the Ordinance on Price Declaration (PBV).

Reduced-price offers are subject to several requirements as set out in Articles 16 et seq of the PBV.

The ordinary price, as well as the reduced one, must be indicated.

It must be specified for which products the reduced price is applicable. However, specification is not needed if the reduced price applies to several products, product groups, or entire assortments. In that case, it must solely be specified for which categories of groups the reduced price applies (eg, “50% off on all coffee capsule products”).

The duration of the reduced-price campaign is limited. A reduced-price campaign may only last for a maximum of two months. The campaign period is calculated in the following way: in the case that the ordinary price prior to the reduced price was charged for two months, the reduced price may last for one month (50% of the period for which the ordinary price was charged prior to the campaign). This also means that a new reduced-price campaign for the same product cannot immediately follow another one.

Additional Requirements

Reduced-price campaigns must also comply with Article 3 paragraph 1 littera f of the UCA. Products and services must not be offered under the cost price repeatedly and in a manner that deceives the consumer about the performance of the advertising company or competitors.

Finally, free offers must comply with Article 3 paragraph 1 littera g of the UCA if it is a premium offer – purchase one product X and receive another product for free (ie, as premium). The premium must not deceive the consumer about the effective value of the offer. There is no deception if the value of the main product and the premium are known or declared

Generally, such provisions are subject to contractual freedom.

Mandatory legal provisions and the following restrictions must, however, be observed.

Contractual relationships between a marketer and a consumer are often governed by general terms and conditions. Based on Article 8 of the UCA, general terms and conditions can be subject to ex post judicial control. This control applies the so called “rule of unusuality”: a clause, the content of which the approving party did not expect and could not reasonably have expected under the circumstances, shall not be valid. This can be the case if a clause is unusual and unrelated to the business. According to the Federal Court, automatic contract renewals are not unusual per se. However, whether a provision is unusual is determined from the point of view of the approving party at the time of the contract conclusion.

Furthermore, Article 27 of the Swiss Civil Code and Articles 19 and 20 of the Code of Obligations must be taken into account for both general terms and conditions and individual agreements. These provisions prevent an excessive contractual binding of a contractual party. This could become relevant in the event of continued renewal of a contract and the associated obligation that a consumer enters into. 

A parliamentary initiative to restrict automatic renewal of service contracts has been debated in the parliament. However, the Council of State rejected an amendment of the Swiss Civil Code.

Sports betting, as well as other forms of gambling, are permitted under rather restrictive requirements.

The Swiss Gambling Act distinguishes between large and small money games (see 7.3 Registration and Approval Requirements). Large money games include sports betting and games of skill that are automated, inter-cantonal or online. Small money games are, for example, sports betting and small poker tournaments (with small stakes and winning possibilities).

Large sports betting may in principle only be offered by Swisslos and Lotterie Romande.

Small sports betting, provided it is held on the same premises as the sports event in question, may also be offered by clubs and companies. In addition, sports betting must be organised locally according to the totalisator principle; this means the bettors bet among themselves. The stake may not exceed CHF200. The total of all bets per day is limited to CHF200,000. The organiser requires a cantonal permit. There is no entitlement to these licences, the cantonal authority can grant them, but it does not have to (see 7.3 Registration and Approval Requirements).

Advertising must not be intrusive or misleading (Article 74, Gambling Act). This applies, in particular, to advertising messages that create and reinforce a false impression in the minds of players, and to advertising in a form or at a time that is chosen in such a way that the player cannot think about it in peace.

Furthermore, it is prohibited to direct advertising to minors or barred persons or to advertise a money game that is not licensed in Switzerland – this is, in particular, important for the advertising of foreign sports betting offers to Swiss recipients. Advertising directed personally to players via electronic channels (eg, email, SMS, and messaging systems in certain applications or social networks) must offer an easy way to opt out of the advertising or to unsubscribe from the address list.

There are no specific rules or regulations regarding advertising, marketing or sale of cryptocurrency and/or NFTs, but rather the application of rules and regulations depends on the legal qualification of the crypto-asset in question. In particular, if a crypto-asset qualifies as a security, the rules regarding offering and advertising of the Financial Services Act (FinSA) and the Financial Service Ordinance (FinSO) have to be observed, specifically Articles 35 et seq and Article 68 of the FinSA. In certain special cases, if a crypto-asset would qualify as a unit of a collective investment scheme, then the specific rules of the Collective Investment Scheme Act (CISA) apply.

However, in any case, the rules of the UCA have to be adhered to.

There are no specific rules or regulations regarding advertising within the metaverse. However, the regulations which apply to advertising in general, also apply to advertising activities in the metaverse. In this regard, the UCA and the guidelines on fairness in commercial communication provided by the Swiss Commission for Fairness (SCF) are particularly relevant.

According to the UCA and the above-mentioned guidelines, commercial communication (advertising) shall not:

• disparage or deliberately ridicule other companies, persons, products or commercial activities;
• present a person or organisation as more favourable (than others) by communicating inaccurate or misleading representations or statements;
• imitate other (pre-existing) products or services in a way that might lead to confusions with said pre-existing products or services;
• use inaccurate or unobjective test results in order to promote a product or service;
• use inaccurate or unlawful indications of origin (eg, Swiss cross for products that do not originate from Switzerland); and
• disguise the commercial purpose of advertising (eg, if an influencer receives a remuneration for the promotion of a product, but their followers are led to believe that it is a personal recommendation or an objective product review).

Furthermore, the UCA entails rather strict provisions on promotional raffles/lotteries (eg, Article 3 paragraph 1 littera t, UCA) and aggressive product marketing activities, which also apply to the metaverse.

Even though advertising in the metaverse is widely discussed in legal articles, it has not been discussed by the authorities or the legislature. This might change if the metaverse transitions from a topic of discussion to a more concrete trend. According to trend barometers, this might happen in the course of 2023.

Switzerland has not implemented any specific marketing or advertising laws to account for the rise of digital advertising platforms and the use of adtech. However, the provisions of the UCA are worded rather broadly and cover many of the issues associated with new forms of advertising.

In addition to the UCA, the DPA is relevant to personalised marketing activities. The new DPA, which is in many aspects similar to the EU GDPR, will enter into force on 1 September 2023. In contrast to the EU GDPR, there is no need for a specific legal basis (eg, consent) for all processing activities. This also applies to profiling (by private companies or persons) if the profiling does not constitute a “high risk” for the rights and freedoms of the data subject. Even if the data subject's consent is not required in all circumstances, many requirements of the DPA must be respected when processing personal data for marketing activities. For instance, information and data security requirements, purpose limitation, data minimisation requirements and the requirement of keeping records of processing activities. Moreover, transfers of personal data to countries with an inadequate level of data protection (such as the USA) are critical and their legal compliance must be assessed on a case-by-case basis.

The Federal Data Protection and Information Commissioner has not yet had to decide on adtech solutions. In other assessments regarding advertising and data protection laws, the Federal Data Protection and Information Commissioner had the tendency to follow decisions by EU Data Protection Authorities (for example, regarding the use of cookies and tracking tools).

The Ordinance on Beverages sets forth the criteria to be complied with by specific beverages – ie, it determines when a beverage may be marketed as mineral water, fruit water, alcohol-free beer, etc. It also sets out certain restrictions for the design of the labels, marketing materials, and for the use of geographic origins (eg, whiskey).

The Federal Statute on Spirits (Alcohol Statutes) contains two provisions dealing with (and restricting) the marketing and advertising of spirits. Article 41 sets out that spirits may not be sold and marketed to consumers under 18 years, that below-cost prices are prohibited, that free samples to an unspecified consumer circle is prohibited, etc. Article 42b contains direct advertising restrictions, such as the requirement that advertising for spirits must only contain information, which directly relates to the product or its features – it is, for example, prohibited to include in advertising for spirits pictures of an attractive sandy beach. It is also prohibited to display spirit ads in specific locations, such as on public transport. Finally, it is also prohibited to distribute spirits as prizes in a sweepstake.

Article 1 of the Federal Statute on Banking Institutes sets out that the term “bank” or “banking institute” must only be used in the advertising (and commercial correspondence in general) of institutes, which are subject to the statute and supervised by the Swiss Financial Services Supervisory Authority. Article 4quater prohibits misleading or intrusive advertising by the Swiss seat of a banking institute. Article 3 of the Ordinance on Banking Institutes sets out that only institutes with a banking licence are permitted to advertise the acceptance of deposits from the public.

Article 20 of the Federal Statute on Chemical Substances sets out that the advertising for dangerous chemicals or chemical mixtures must not mislead the public about the danger of the products or lead to an improper use. Article 45 of the Ordinance on Chemicals prohibits the use of specific terms, such as “non-toxic”, “eco-friendly”, in the advertising for such products. Article 75 of the Ordinance contains further advertising restrictions, in particular regarding bio-claims.

Article 31 of the Federal Statute on Medicinal Products and Medical Devices sets out as a principle that it is permitted to advertise all types of medicinal products if the advertising is directed exclusively at persons who prescribe or dispense them. It is also permitted to advertise non-prescription medicinal products to the general public. Article 32 deals with unlawful advertising for medicinal products. Further details on the advertising of medicinal products are included in the Ordinance on Advertising of Medicinal Products. The Ordinance differentiates between advertising to specialists and advertising to the public.

Article 12 of the Ordinance on Foodstuffs stipulates a general prohibition against misleading and deceiving consumers in the advertising of foodstuffs. Article 12 paragraph 3 of the Ordinance prohibits the use of specific claims and information in advertising, such as health-related claims (with certain exceptions), deceptive claims about the origin of a foodstuff, etc.

Since the individual substances of cannabinoids as well as hemp extracts containing cannabinoids have historically not been consumed to any significant extent in connection with foodstuffs, products constituted in this way are regularly to be qualified as novel food. Advertising for novel food is subject to the same requirements as set out for other foodstuff above. Please note that certain products containing CBD (permitted are only products with less than 1% THC) can also be qualified as utility articles, such as pouches (snus) with CBD or cosmetic articles. For such utility articles, the advertising must not be deceptive, misleading or inaccurate and the advertising must not contain any health claims (Article 18, Federal Statute on Foodstuff and Utility Articles).

Articles 17 et seq of the Ordinance on Tobacco Products prohibits the use of misleading or deceptive claims in advertising. Furthermore, it prohibits advertising tobacco products to consumers under 18 years old, in specific locations (eg, close to schools) or on specific products (eg, on advertising material which is distributed to minors). In addition, the industry has established its own advertising guidance, which expand on the advertising restrictions set out in the Ordinance. Such advertising self-regulations also exist regarding e-cigarettes as well as oral tobacco or nicotine products. Advertising of tobacco products and e-cigarettes is further restricted by some cantonal laws.

A new Federal Statute on Tobacco Products, which is expected to enter into force in the summer of 2023, will cover e-cigarettes, oral products with tobacco or with nicotine only, and “heat not burn” products. The new statute contains advertising restrictions for all of these products, such as no advertising and sale to minors, no deceptive claims, etc. Certain sales activities, such as price-offs and raffles, shall be prohibited. The advertising related provisions are the most contested provisions in this new statute.

The most relevant specific rules for products have been mentioned. Advertising for other products or services must be assessed on a case-by-case basis.