A foreign national completes conveyancing on a Swiss residential property, records the transaction in the land register, and assumes the matter is closed. Months later, a compliance review reveals that tightened authorisation rules now place that acquisition in a restricted category – with penalties and mandatory divestiture on the table. Switzerland's property ownership regime for non-residents has never been permissive. Recent regulatory reinforcements have made it significantly more demanding.
Switzerland has strengthened its residential and commercial real estate rules affecting foreign property owners, with the updated measures entering force progressively from mid-2025 onward. Foreign individuals and entities structured through non-Swiss holding vehicles. including those using an Aktiengesellschaft (AG) or Gesellschaft mit beschränkter Haftung (GmbH CH) – must reassess whether existing holdings and planned acquisitions remain within authorised thresholds. Compliance reviews and cantonal permit applications, where required, should be completed before any property transfer proceeds.
This alert identifies the core regulatory changes, the business categories most at risk, and the immediate steps that international property owners and corporate investors should take now.
What has changed and when it takes effect
Switzerland has long restricted foreign acquisition of residential real estate through its federal investment legislation – a regime practitioners refer to colloquially as the Lex Koller rules. The recent reinforcement tightens three areas that had previously generated ambiguity.
Extended scope of the authorisation requirement. Regulatory guidance issued in 2024 and applied from mid-2025 clarifies that indirect acquisition through corporate vehicles. including foreign-domiciled companies holding Swiss property assets. now falls squarely within the authorisation perimeter. A foreign investor who previously held Swiss residential property through a Luxembourg or British Virgin Islands holding structure must now assess whether that arrangement requires cantonal authorisation. The authorities' position is that economic control over Swiss land, not formal legal title, determines whether the rules apply.
Commercial property and the expanding grey zone. Switzerland's investment legislation has traditionally drawn a firm line between residential property (restricted) and commercial property (generally unrestricted for foreign buyers). Updated enforcement guidance narrows the commercial exemption. Properties that combine residential and commercial use – mixed-use buildings, serviced apartments positioned as tourism assets, and co-living developments – are now scrutinised more carefully. The Bundesgericht (Federal Supreme Court of Switzerland) has in recent years affirmed a purposive reading of the residential use criterion, and cantonal authorities are applying that standard at the permit stage.
Transparency requirements and the land register. Amendments to cantonal implementing rules now require more detailed beneficial ownership disclosure when a property transfer is recorded in the Grundbuch (land register). A notarial deed – the öffentliche Beurkundung (notarised public deed in Swiss law) – has always been required to complete a valid property transfer. What is new is the supporting documentation the notary must collect and retain: ultimate beneficial owner declarations, corporate structure charts, and confirmation of any prior cantonal permit. Incomplete files now delay or block registration.
For international investors, the practical consequence is clear. Due diligence on any Swiss property acquisition must now extend beyond the title deed and into the beneficial ownership chain. A clean Grundbuch entry does not establish compliance if the underlying ownership structure has not been reviewed against current authorisation criteria.
For an overview of how these measures interact with Swiss tax obligations for foreign holders, see our analysis of tax law matters in Switzerland.
Who is affected – threshold criteria and business categories
The changes affect several distinct categories of foreign property owner. Understanding which category applies determines the urgency and nature of the required response.
Individual foreign nationals without Swiss residency. Non-resident individuals who hold or seek to acquire Swiss residential property remain subject to the cantonal permit system. The permit quota – allocated annually by canton – has not been expanded. Demand continues to outpace supply in most Alpine and lake-shore cantons. Foreign nationals who acquired property under prior permits should verify that use conditions (primary residence, holiday use, rental restrictions) have been observed. Breach of use conditions is an independent ground for enforcement.
Foreign legal entities and corporate investors. Any company incorporated outside Switzerland that directly owns Swiss real estate is subject to the authorisation regime if the property falls within the residential or mixed-use category. Structures using a Swiss Aktiengesellschaft (AG) or GmbH CH as a local holding vehicle are not automatically exempt. If the majority of shares in that Swiss entity are held by foreign persons, the entity itself is treated as foreign for authorisation purposes. The Handelsregister Schweiz (Swiss Commercial Register) entry for the local entity does not confer residence status on its foreign shareholders.
Real estate funds and collective investment vehicles. Foreign-domiciled funds holding Swiss property assets through participation structures must assess whether their investor composition has shifted in a way that now triggers the foreign majority threshold. This is particularly relevant for funds that have admitted new investors since their initial cantonal clearance was obtained.
Mixed-use and tourism property operators. Operators of serviced apartments, boutique hotels with residential annexes, and short-term rental portfolios in tourist zones face the highest exposure under the updated mixed-use guidance. The authorities now apply a substance-over-form test: if a property is habitually occupied as a private residence – even part of the year – the residential use criterion is likely satisfied.
The compliance deadline for owners who believe their existing structure may now fall within the restricted category is the end of Q2 2026. Cantonal authorities have signalled a structured review period, but have also confirmed that spontaneous disclosure before that deadline will be treated more favourably than enforcement-triggered disclosure.
To discuss whether your property holding structure in Switzerland requires authorisation review, contact us at info@ferrazwhitmore.com.
Immediate actions for international property owners
The regulatory shift requires concrete steps. The following actions are prioritised by urgency.
1. Conduct a structural ownership audit. Map the full beneficial ownership chain for every Swiss property asset. Identify whether any foreign individual or entity controls more than fifty percent of the holding vehicle. Under Switzerland's Swiss Code of Obligations and property investment legislation, economic control – including voting rights, profit participation, and financing arrangements – is assessed holistically, not only through registered shareholding.
2. Review the land register entry and underlying notarial documentation. Retrieve the öffentliche Beurkundung and confirm that all disclosed information remains accurate. If the ownership structure has changed since the property was recorded in the land register, an updated disclosure may be required. Gaps between the registered title deed and the current beneficial ownership position are a primary trigger for enforcement inquiries.
3. Assess mixed-use classification. If you hold a property that is used partly for residential purposes – even seasonally – obtain a written assessment of its classification under current cantonal guidance. Do not rely on classifications applied at the time of acquisition. The mixed-use perimeter has shifted, and a property previously cleared as commercial may now fall within the residential category.
4. File or update cantonal permit applications proactively. Where an authorisation requirement applies and no permit has been obtained, initiate the cantonal application without delay. Voluntary disclosure prior to the Q2 2026 deadline attracts a more measured enforcement response. Failure to file – or filing after an enforcement notice is issued – carries significantly heavier consequences, including compulsory sale orders.
5. Coordinate with Swiss counsel on the Handelsregister Schweiz position. If a Swiss AG or GmbH CH is part of the holding structure, verify that its Commercial Register entry accurately reflects current shareholders and directors. Regulatory authorities cross-reference Commercial Register data against property ownership records as part of their compliance monitoring. Discrepancies between the two registers are a recognised enforcement trigger. Foreign investors using a Swiss corporate vehicle should also ensure the entity has genuine local substance, as letterbox structures are subject to heightened scrutiny under current enforcement practice.
A broader comparison of how foreign property ownership restrictions operate across EU jurisdictions – including Portugal's own rules for non-EU buyers – is available in our related alert on real estate regulation changes in Portugal.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. In Switzerland, our real estate practice supports foreign individuals, corporate investors. Additionally. Fund managers through the full lifecycle of Swiss property transactions. from pre-acquisition due diligence and cantonal permit applications to land register compliance and corporate structure review. As a law firm in Switzerland-facing cross-border matters, we combine Portuguese civil law expertise with English common law tradition to deliver legal support across both civil law systems. Our attorneys have advised on property transfer matters involving mixed civil law and common law holding structures across European and international markets. Engaging a lawyer in Switzerland-focused matters through an internationally experienced team reduces the risk of structural gaps that local advisers working in a single jurisdiction may not identify. The firm's Lisbon base provides direct access to EU and Atlantic regulatory settings, while our Swiss practice network supports cantonal and federal compliance work. To discuss your Swiss real estate position, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.
Published: February 15, 2026
Author: Sophie Kellner, Partner, IP & Technology Law
Author bio: Sophie Kellner is a Partner at Ferraz & Whitmore focusing on intellectual property protection, AI and technology regulation, and employment law across European and international markets. She advises technology companies, investors, and institutions on IP strategy, regulatory compliance, and workforce matters.