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OCPARTHCNl OF STATE. 

WASHIHGlOH 

November 3, 1993 

Exc~llency, 

1 H~ve the honor to refec to the Tre~ty between the 

Unit~~ State~ of America and the swi~s confedet~tion .on 

Mutual AssisL&nce in Criminal Matt~rs, ~h)ch was signed on 

May 25, 1973, and entered into force on January 23, 1977 

( •Tr~aty•) 1 lind to the Agreem~nt of t~ovember 10, 1997. 

I have the honor to~r~fer to r~c~nt discus~ions 

bctwpen representatives of our two Gov~rnments to expand 

the coverage· of the Tre~ty involvjng violations of the 

laws and regulations governin9 the off~r, purchbse or sale 

of Eecurit)~s, future~ or options, in bccoroance with 

Articl~ 1, Paragraph 3 o£ the ~(ebty. Articl~ 1, 

Paragraph 3 of the Treaty provides that •the competent 

authoriLie!; of the C<>ntt·bcting Parties fllbY 3.gree that 

assistance ~s provided by thi~ Trea~y will al~o be grented 

in cert~in ancilla:ry a.dlid nistrativ~ proct-edings in re~p~ct 

of measures which may be taken against the perpetrator of 

an offen£e falling within the pur~iew oi this Treaty.· 

In case& involving offenses in connect5on with th~ 

offer, purcha3e, or sale of securitiee, futureo or 

o~tions. lhe ·offenders may not only be found guilty and 

sent~nced in a criminal proceeding but also may be subject 

to other sanctions in order tJ~at the harn• caused by the 

offense is repai.red or that the off~nders are detetrco 

from similar conduct in the: futUt(!. lt is therefore the 

His Excellen<:y 

carlo Jagmetti, 

Amba<>&ailor of ls"It"@rland. 

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understanding of the Governm~nt o£ the united state6 of 

'•eric~ that, if-assistance under lbe Treaty could be 

~ranted with a view to poss)ble penal proceedings, it will 

also be granted in connection with th~ following 

proceedings, including foraal investigations that may lead 

to such proceedings~ that are conducted by the securities 

and Exchange commission t•sEc•) ~ith respect to of~enses 

in connection vith the offer, purchase or sale of 

securities such as trading of securitiec by persons in 

possession of mat~rial -non-public information, or by the 

Co~~odity rtitures Traaing Com~ission t•cFTC•) with respect 

to offenses that involve the o££er, purchase or sale of 

futures or options, and are covered by the Treaty 

(1) ~uits in a couct of the united States 

seeking permanent or preliminary injunctions or 

temporary. restraining orders or enforcem~nt 

proceC!dings before the S!-;c, the Cf'TC or an 

administrative law judgQ seeking ceaae-and-desist 

orders; 

(2} Suits in a court of the United States or 

enforcement proceedings before the SEC, the CFTC or an 

administrative law judge seeking other equitable 

relief ancillary to the relief sought in paragraph (1) 

above, such a& a freeze of assets-or the oisgorgement 

of profits gained (Ot losses avoided) ae a r~sult of 

violative conduct; 

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(3) Suits in a court of the United St8tes or 

E:-nforcement proceed.1Jl9& before the S£C, th~ CFTC or lt.n 

administrative law judge seeking the impo&ition of & 

civil penalty or· fine, provided however, il evidence 

or information is obtain~d pursuant t_o a grant o! 

assist·ance un~er the Treaty 1 such evic3~nce or 

information shall not be used to secure the i~position 

of a civil penalty or fis1e to cotopel a pen~on to act 

in a way th~t ~ould ~e eontcary to Swiss law; 

(4) Suits in & court of the Unite6 States or 

enforc~ment proceedings befor~ the SEC, the CFTC or an 

administrative l&w ju~ge for ~n order commanding a 

person to comply in the future with provi~)ons of the 

United stat~~ s~curities, futures or options laws or. 

the !Ules and regulutions_ptomulgated thereunder7 and 

(5) Enforcement proceedings conducte6 before the 

s~c, the CF~C or an admini~trative law judge in which 

the r~vocation or euspen&ion of the registration of b 

tQgulated entity, or a sus~ension or bar of a per5on 

from b~ing associhtcd with .&uch an entity, as b result 

ot violat1~e conduct is sough~. 

It is agceed ~hat tbe Treaty provid~s an important 

ffleans of obtaining informetion needed to enforce the 

criminal or penal law~ 6£ the united States and that the 

Treaty should be tised to the ext•rit"feasible. It is 

further unoe-r6tood that an inve&tigati·on by the s~c oc the 

CFTC is to be considered an investigation for vhieh 

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as5)£tance can be furnished (if the oth~~ requirements of 

the Treaty are ~~t) as. long ~s the investigation relates 

·to conduct which Might be ae,lt with by the cri~lnal 

courts of the United States •. 

1 hiiVe th~ further honor to state, on beh.&lf of the 

Government of the Onited states of America, ~hat if 

assistance und~r the Treaty could be granted with a view -

to possible cti-inal proceedings in Swit~erland, 

assistance will ~lso be granted in connection with. the 

following investigations and proceedings, including . investigations that may~ead to 6UCh proceedings, that are 

conducted by competent swi&s authorities with respect to 

offen~oc in connection with the offer, purchase or sale of 

securities, futures or options, and arc covered by the 

Treaty: 

(l) Th& iceUbnce of court or admini6trbtive 

ord!!'rs declaring a vjolation of, or commnnding a 

penH>n. to comply in the fut.ure with, llpplic~ble lilw.s 

or. rules or regulations promul9ated thereunder; 

{2) The imposition of a tonnal prohibition to 

eng~ge in a vocation, trade or business which r~quires 

a licen~e; 

(3} The revocation of a license to engage in a 

vocation, trade or business or the rcmo~al of a person 

from a particular position in a regulat~d entity; 

(4) rb& imposition of & penalty or sanction 

under administrative law, provided however, if evioenc~ 

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or info~mation )s obtained pur5Ubnt to a grbn~ of 

assistance un~er th~ Trebty, such, evidence or 

inform&tion shall not b~ used to s~cure the imposition 

of a penalty or sanctjon under admlnistrbtive law to 

co~pel ~ per60n to act in a WbY that would be contrary 

to-united States law; and 

(5) The judicial confiscation of objects ana 

a6sets, including tree%es of a3eets. 

If the foregoing is acceptable to tbe Swi$s Federal 

· council, I have the hon~t to propose thflt this note and 

.Your Excellency's reply tbereto shall constitute an 

agreement between the coMpetent au~horities pursuant to 

Article l, Paragraph 3 of the Treaty, wh~ch shall 

BUpersede the A9reement of November lOr 1987 1 and which 

shall enter i~to force on the date of Your Excell~ncy•s 

note in reply. 

I am aware th~t proposed legislation on stock 

exchanges and securjties trading, which would provide for -

~ fcdet&l 6Upervisory ~uthority, is under considerbtion in 

~ Switzerland. In thQ event th~t relevant fun~ti6ns of the 

Swiss FedQtal Office for ~olice MaLter£ are ttaneterred to 

the federal supervisory authority pursuant to the 

legislation, modificatjon of thi6 agreemeni .roay be 

necees&ry. 

Accept, Excellency, th~ renew.ed a$surances of. my 

highest con.sid~ration. 

Pot the secretary of stat~: 

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Washington, November 3. 1993 

Dear Mr." Secretary: 

· I have the honor to acknowledge the .receipt of Your Exce11ency's note dateo 

November 3, 1993, which reads a.~ follows: 

"I have the honor to refer to the Treaty between the United States of America and 

the Swiss Confederation on Mutual Assistance in Criminal Matters. which was signed on 

May 25, 1973. and entered.into force on January 23, 1977 ('Treaty-), ;md to the Agreement 

of November 10, 1987. ~ · 

I have the honor to refer to recent discussions between representatives of our two 

Governments· to expand . the coverage of the Treaty in~olving violations of the laws and 

regulations governing the offer, purchase or sale of securities. futures or options. in 

. accordance with Article 1. Paragraph 3 of the Treaty. Article J, Paragraph 3 of the Treaty · 

provides that 'the con1petent authorities of the Contracting Parties may agree that ac;sist<mce 

as provided by this Treaty will also be granted in certain ancillary administrative 

proceedings in respect of measures which may be taken against the perpetrator of an offense 

falling wjtl~in the pu~jew of this Treaty.' . 

In cases involving offenses in connection with the offer, purchase. or sale of 

securitjes. futures or options, the offenders may not only be found guilty and sentenced in a 

criminal proceeding but also may be subject to other sanctions in order that the harm caused . \ 

by the offense is repaired or that the offenders are deterred from sin1ilar conduct in the 

future. It is therefore the understand\ng of the Government of the United States of America 

that, if assistance unde.r; the Treat)' could be granted· with a vic'v to possible pennl 

proceedings. it will also be granted in connection with the foHowing proceedings. including 

fonual investigations that may lead to such proceedings, that nre conducted by the 

Securities and Exchange Commission ('SEC') with respect to offenses in connection_ with 

the offer, purchase or .sale of securities such as trading of securities by pet'sons in possession 

of material non-public information, or by d1e Coounodity Futures Trading Comnussion 

\Cl·•"IC) with respect ·to offenses that involve the offer, pureha.~ or sale of futures or 

options, and are covered by the Treaty ('violative conduct'): · 

( J) Suits in a court of the United States seeking permanent or preliminarY' injunctions or 

temporary restraining orders or en. forccmcnt proceedings before the SEC, the CFfC or 7 

administrative law judge seeking cease-and-desist ordctS; , 

, .• z~ ~ 

The Honorable 

Warren Christopher 

The Secretary of State 

Wasbjngton, D.C. 

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(2) Suits in a court of the United States or enforcement proceedings before the SEC. the 

CFTC or an administrative Jaw judge seeking othec equitable relief anciJJary to the relief 

sought in paragraph (J) above, such as a fite7.e of assets or the disgorgemcnt of profits 

gained (or losses avoided) as· a result of violative conduct; · · 

(3) Suits in a court of the United States or enforcement proceedings befor~ the SEC. the 

CFTC or an administrative law judge seeking the imposition of a civil penalty or fme, 

provided however, if evidence or information is obtained pursuant .to a grant of assistanceunder the Treaty, such evjdence or information shaJI not be used to seciJre the imposition of 

a civil penalty or fine to compel a person to act in a way that would be contrary to Swiss 

law; 

(4) Suits jn a court of the Unil.ed States or enforcement procccdjngs before the SEC. the 

CFfC or an administrative-law judge for an order commanding a petSQn to comply in the 

. future with provjsjons of the United States securities, futures or options Jaws or the roles 

and regulations promulgated thereunder; arid 

(5) Enforcement proceedings conducted before the SEC, the CFJ'C or an administrdti"Je 

laYJ judge in which the revocation or suspension of the registration of a regulated entity, or 

a suspension or bar of a person from being associated with such an entity, as n result. of 

violative conduct is soughL 

It is agreed that the Trenty provjdcs an imporlaol menns of obtaining information 

needed to enforce the criminal or penal laws of the United States nnd that the Treaty should 

be used to the extent feasible. lt is further understood that an hlVestigation by the SEC or 

the CFTC is to be considered an investigatjon for which assistance can be furnished CJf the 

other requirements of the Treaty are met) as long as the investigation relates to conduct 

which mjght be ~ealt wit1l by the criminal courts of the United States. 

I • have further horior to state., on behalf of the Govenm1cnt of the United Slates of 

America; that if assistance t~ndcr the Treaty could be granted .with a view to possible 

criminal proceedings in S·witzerhmd, assistance will· also he granted in connection wjth the 

following investigat-ions nnd proceedings. including investigations that may lend to such 

proceedings. that are conductep by con1petent Swiss authorities with respect" to offense.~ in 

connection with the offer. pur&hase or sale of securities. fotures or options. and are covered 

by the Treaty: -

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( l) The issuance of court or administrative orders decJarfug ·a violation of, .or 

commanding a person to comply jn the future with. applicable Jaws or rules or regulations 

promulgated thereunder; 

(2) Jbe imposition of a forn1al prohibition to engage in a vocation. trade or bnsincss 

which requires n license; ·-·-

(3) The revocation of a license to engage in a vocation. trade or business or the ren1oval 

of a person frorn a particular position in _a regulated_ entity; 

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(4) The imposjtion of a penalty or sanction under administrative_law. provid~ however, 

if evidence or information is obtained pursuant to- a grant of ac;.~istancc under the·Trcaty. 

such evidence or information shall not be used to secure the imposition of a penalty or 

sanction under admJni~trntive law to compel a person to act jn a way that would be contrary 

to United States Jaw; and 

(5) The judicial confiscation of objects and assets. including freezes of asset~. 

If the foregoing is acceptable to the Swis.~ Fed~ral Council, I have the honor to 

propose that this note and Your Excellency's reply tl1ereto sba)J constitute an agreement 

between the competent authorities pursuant to Article l, Paragraph 3 of the Treaty. which 

shall supersede· the Agreement of November JO. 1987. a~d which shall enter into force on 

the date of your Excellency's note in reply. 

I am aware that proposed legislation on stock exchanges and securities trading, 

which would provjde for a federal supervisory authorUy, is under considerarjon -in 

Switzerland. In the event that relevant functions of the SwiSs Feder&l Office for Police 

Matters arc transferred to the federal sUpervisory authority pursuant to . the legislation, 

modj fie at ion of this agreement may be necessary. •• . 

I have the honor to confirm that the forcgojng is aeccptable to the Swiss Federal 

Council and this exchange of notes shaH constitute an agreement between thc~competenl 

authorities pursuant to Article_ 1, Paragraph 3 of the Treaty. 

Accept, Mr. Secretary, the rc11ewed asSllrances of my hjghest consideration. 

Carlo Jagmetti 

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