Source: https://www.elibrary.imf.org/abstract/IMF072/01497-9781557757968/01497-9781557757968/ch18.xml?rskey=Blu1zJ&amp;result=7
Timestamp: 2019-04-21 22:39:10+00:00

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The topic I have been asked to speak about is so wide-ranging that I will concentrate on only a few specific aspects. My choice of topics may appear random, but is based on issues I have dealt with in my work as an attorney in the first four months of 1998.
In the first part of this paper I compare two tools used for risk reduction, set-off and pledge. Such a comparison has to take into account legal aspects as well as the advances in IT and telecommunications that result in the rationalization and centralization of systems, values, and securities.
In the second part, I focus on the enforcement of claims from the point of view of the debtor and immunity against enforcement of claims to the detriment of central bank assets deposited abroad.
Value rights, i.e., uncertified financial claims, exist in the form of bookentry securities for government securities.7 Pledging of such value rights is effected according to the provisions governing the pledging of claims. Further, the right of lien must also be recorded in the register.
Securities may be pledged in the same way as ordinary claims. In addition, a special form of pledging for securities is possible (Art. 901 Civil Code). In the case of bearer securities a written pledge agreement is not required. A verbal agreement, followed by transfer of the security to the pledgee, is sufficient (Art. 901 para. 1 Civil Code). In the case of securities made out to order, a pledging endorsement is also required (Art. 901 para. 2 Civil Code).
Actual transfer of possession is not necessary if the pledgee is already in possession of the securities prior to pledging (brevi manu traditio).
If the security is owned by a third party, it is sufficient for pledging purposes to assign the claim for restitution against the third party to the pledgee (notice of transfer of possession, Art. 924 Civil Code).
In accordance with the principle that the pledge must be outwardly evidenced by transfer of possession (publicity rule), the pledging of securities becomes effective as soon as possession is transferred. If possession is not transferred in accordance with the law, the pledge is not effective vis-à-vis third parties (Art. 717 and Art. 888 para. 2 Civil Code).
The pledge expires if the claim is extinguished or if the pledged chattel is destroyed (Art. 889 in conjunction with Art. 899 para. 2 Civil Code). The loss of possession of the pledged chattel by the creditor also entails the expiry of the lien if the creditor is legally unable to recover the pledged chattel (Art. 888 para. 1 in conjunction with Art. 899 para. 2 Civil Code).
The principle of prior constitution applies when the ranking among different pledges is to be determined (Art. 893 para. 2 in conjunction with Art. 899 para. 2 Civil Code). However, the bona fide purchaser of a pledge takes priority over any earlier constitution of a pledge (Art. 884 para. 2 Civil Code).
In Switzerland a separate procedure exists for execution in the case of claims secured by collateral, i.e., debt collection through the realization of a pledge.21 This special execution procedure does not take into account the interests of other creditors but focuses on the liquidation of assets set aside for the creditor by the pledging of the chattel.22 This ensures that the pledgee has priority over the other creditors.
The bank has a right of lien on all assets it holds for the account of a client whether in its own custody or placed elsewhere .… Immediately upon default by the client the Bank shall be entitled without further notice to dispose, either by forced sale or in the open market, of any assets over which it has a right of lien.
Under Swiss statutory law, set-off empowers persons to change a legal relationship to which they are a party by unilateral act (einseitige Gestaltungsbefugnis).
If two persons have entered into mutual obligations and owe each other pecuniary debts or claims of equivalent character, either party may unilaterally invoke set-off and so cause the mutual claims to be compensated and thereby extinguished. Compensation operates up to the amount of equality in claims and leaves the remaining part of the higher claim unaffected.
If a set-off agreement has been signed, then in the event of litigation this agreement must be judged and enforced by a court of law.
For modern cross-border banking operations, the institution of the pledge is no longer of practical use. Its inflexibility becomes apparent, for example, in the need to transfer possession of the pledged chattels to the creditor (publicity rule), in the burdensome procedures for enforcement in bankruptcy, and in the difficulties of finding a simple solution to the questions of international private law.
Pledging of chattels does not seem to be an area in which the legal harmonization for cross-border transactions can be easily established on a voluntary basis, i.e., without the need for governmental action. This statement may be illustrated with the following chart comparing pledge and set-off.
Security interest in goods. Grounds for extinction of claims.
Given the possibility of future insolvency, right of realization is granted to the creditor in respect of certain assets. Uncertainty whether, at the time set-off is exercised, the debtor is also the creditor towards the party declaring set-off. Clearly defined security—such as when chattels are pledged—exists only where this is contractually agreed by a current account clause.
The publicity rule requires the pledgor to renounce physical control over the pledged chattels; pledging is thus evident to third parties and deprives the pledgor of the use of the goods. The option of set-off is not evident to third parties.
The pledging of claims requires a written pledge agreement. Pledging of securities requires a transfer of ownership. Set-off declarations and agreements are not subject to formalities.
Realization is subject to enforcement procedures defined by law and involving authorities; free disposal of assets may be contractually agreed. No complex or laborious realization procedures involving authorities: set-off may be exercised by unilateral declaration or contractual agreement.
In the event of bankruptcy: can no longer be enforced privately but requires involvement of authorities. Still applicable and enforceable privately even in the event of bankruptcy.
Only the legally approved types of pledge are admissible (numerus clausus). Statutory provisions are nonmandatory.
Legal situation is complex in cross-border business. Clear-cut legal situation can be created in cross-border business by stipulating applicable jurisdiction in a contractual agreement.
With the creation of the European economic and monetary union on January 1, 1999, a new payment system known as TARGET (Trans-European Automated Real-Time Gross-Settlement Express Transfer System) will be introduced. In TARGET, payment instructions will only be processed if sufficient funds are available.63 The European Monetary Institute and the central banks of the individual countries have agreed among themselves on the cross-border utilization of collateral within Target. This means that chattels may be pledged on a pan-European basis, regardless of their physical location.64 The European Monetary Institute requires that securities settlement systems and procedures ensure speedy, smooth, and reliable transactions.65 On a European level, only collective custody or book-entry securities will allow the necessary rationalization and centralization regarding pledging of chattels. Among the various procedures available, the European Monetary Institute is particularly in favor of a Real Time System that settles transfer instructions for both securities and funds on a trade-by-trade (gross) basis, with final transfer of securities at the same time as final transfers of funds. In the German version of the European Monetary Institute’s report, “delivery” of securities is translated as “Wertpapierverrechnung,” or “set-off of securities,”66 suggesting that physical possession is replaced by a book entry similar to a claim against the registrar. Offsetting of bonds and shares—this wording might be an erroneous translation or used on purpose. In any case it gives the impression that the practical handling of the claim against the central depository seems more similar to an in personam right than to an in rem right, by this avoiding the need for a fictitious transfer of possession.
At multinational groups, cash management is difficult to perform at an international level owing to the global nature of these companies’ activities. Depending on their business, the national subsidiaries of a multinational holding company may have either a shortage or an overabundance of liquidity. This is why banks offer cash pooling services to such multinational companies.
One way to establish cash pooling is to set up a special purpose vehicle (SPV). The sole objective of such SPVs is to smooth out intra-group financing flows. Based on a master agreement with the SPV, group companies lend surplus capital to the SPV, which the SPV then lends to group companies requiring additional liquidity. The payments are executed by the bank offering the cash pooling facility. This bank has to keep a separate current account for each group company and each currency. Implementation of cash pooling inevitably results in debit balances in one currency whereas in other currencies the SPV has a credit balance towards the bank.
Pledging of the SPV’s claims to the bank as security for loans granted in other currencies is generally impossible in practice. When raising funds, multinationals usually exclude any pledging of their assets by way of negative pledges in which they promise to the creditor not to burden any assets with pledges in favor of third parties.
In off-balance-sheet business, it is permissible to set off the positive and negative replacement values of derivative instruments based on an enforceable netting agreement.81 The Swiss Federal Banking Commission shared the view expressed by a bank that a set-off agreement for a cash pooling facility should be placed on an equal footing with the netting of off-balance-sheet assets and liabilities.82 By this, set-off replaces the pledging of assets for the purpose of assessing equity requirements for loans.
Federal Court rulings on central bank assets to date are not sufficiently relevant and are not adequate to the current importance of foreign-exchange reserves. We have to go back to the 1980s to find a ruling concerned explicitly with central bank assets. Since then, Switzerland has joined the International Monetary Fund and has started revising both its monetary constitution125 and its National Bank Act.126 Those parts of the latter revisions relating to foreign-exchange reserves became effective on November 1, 1997.127 Especially the documents preparing and explaining the revised provisions define the position of foreign-exchange reserves in Switzerland far more closely than was the case in the 1980s.
How large do a country’s foreign-exchange reserves need to be if the central bank is to satisfactorily perform its duties? This depends above all on the size of the economy and the degree of a country’s international involvement. In Switzerland it is assumed that this requirement grows in step with the growth in foreign trade and capital transactions. A rule of thumb is that the unsecured foreign-exchange reserves need to be increased at least in line with nominal GNP.134 In addition, Switzerland’s foreign-exchange reserves are used as an instrument for regulating money supply. If the central bank wants to increase the money supply, it buys a foreign currency from the banks and supplies them with the equivalent in Swiss francs. At the same time, it sells the foreign currency forward (foreign exchange swap) so as not to enter into any exchange rate risk.135 The precise size of the secured foreign-exchange reserves cannot be stated but is determined by the needs of money supply control.
The attachment of a debtor’s assets presupposes that a matured money claim against the debtor exists, that the debtor has assets in Switzerland, and that sufficient grounds for attachment exist. The creditor must furnish prima facie evidence in support of his claim, of the debtor’s assets, and of the existence of ground for attachment (Art. 272 Federal Law on Debt Collection and Bankruptcy). He must make these elements plausible to the judge.
The judge at the place where the assets to be attached are located is competent for the granting of attachment.139 This judge decides in the so-called “summary procedure” (Art. 25 no. 2 lit. a Federal Law on Debt Collection and Bankruptcy) in which only limited instruments of proof are admitted. Furthermore, the judge decides based on the assertion of the creditor alone. The debtor has “no right to be heard” at first hand (see below, III. C).
debtor insolvent; the creditor has a definitive or provisional certificate of loss against the debtor.
In international dealings, the concept of “place of residence” or “registered office” is defined according to Arts. 20 and 21 Federal Law on International Private Law.145 The domicile stated in a company’s articles of incorporation and bylaws is regarded as its registered office (Art. 21 para. 2 Federal Law on International Private Law).
An attempt to attach a foreign central bank’s currency reserves held in Switzerland would then probably be regarded as an inadmissible “fishing expedition” request if the creditor requests an identical attachment for a large number of banks because he has no indication as to where the reserves are deposited.158 It is doubtful and left to the court’s discretion whether an identical application for the attachment of a foreign central bank’s assets described only in a generic way at all three of the big Swiss banks (CS, SBC, and UBS) would be admissible.
An “enforceable court decision” refers primarily to the decision of a court or arbitrator in Switzerland.
To satisfy the requirements for attachment, a foreign decision must be enforceable in Switzerland. An “enforceable court decision” is a ruling of an ordinary court of law or arbitrator abroad that is capable of having the effect of being executed in the context of exequatur proceedings. The preconditions for enforcement of foreign decisions are based on Art. 25–31 Federal Law on International Private Law. Any foreign decision against which no further appeal can be lodged shall be recognized in Switzerland if the judicial or administrative authorities of the state in which the decision was rendered had jurisdiction (Art. 25 Federal Law on International Private Law). Furthermore, recognition is excluded because of manifest incompatibility with Swiss law (Art. 27 Federal Law on International Private Law).
It is not clear as yet whether the existence of an acknowledgement of indebtedness needs to be proved absolutely to the judge competent for granting attachment or only needs to be made plausible to him by prima facie evidence. As a rule, legal doctrine favors merely a provisional investigation by the judge, as a decision on the quality of a document as an acknowledgement of indebtedness will be made later as part of the standard debt-collection proceedings.180 Consequently, it is sufficient here to make the existence of the acknowledgement of indebtedness plausible rather than providing documentary proof.
The debtor has the option of objecting against the attachment order (Art. 278 Federal Law on Debt Collection and Bankruptcy). This objection gives the attachment debtor an initial opportunity to be heard184 and can thus be seen as a continuation of the attachment authorization procedure. Consequently, appeal does not have any effect of deferral (Art. 278 para. 4 Federal Law on Debt Collection and Bankruptcy).
An appeal must be lodged within ten days (Art. 278 para. 4 Federal Law on Debt Collection and Bankruptcy).
The judge confirms, modifies, or reverses his decision. The decision may be challenged by appeal to a higher cantonal authority. New facts may be brought to the attention of this higher authority (Art. 278 para. 3 Federal Law on Debt Collection and Bankruptcy).
In the event of an inadmissible attachment of the assets of a foreign state, the state in question needs not go through the cantonal courts but can appeal directly to the Federal Court by lodging a constitutional complaint on the grounds of an arbitrary decision (Art. 86 para. 2 Federal Law on the Organisation of the Federal Juridical Procedures).190 The availability of this option to a foreign central bank in respect of assets serving sovereign purposes is—to the best of my knowledge—without prejudice.
Within ten days of the granting of the attachment, the creditor must pursue his claim by initiating legal proceedings against the debtor to validate the attachment (Art. 279 Federal Law on Debt Collection and Bankruptcy). The pursuit must be made either by debt collection proceedings or by filing a lawsuit in validation of the attachment, both at the Swiss place of attachment (Art. 4 Federal Law on International Private Law).
Attachment is served in Switzerland on the basis of unilateral arguments of the creditor. An attachment on assets of a foreign central bank that are deposited with banks in Switzerland, including subsidiaries and branches of foreign banks in Switzerland, is possible only if the creditor succeeds in convincing the attachment judge that the currency reserves do not serve a sovereign purpose (Art. 92 no. 11 Federal Law on Debt Collection and Bankruptcy). Based on past rulings of the Federal Court as outlined above, this must be regarded as possible.
In my view, the currency reserves of foreign central banks held in Switzerland solely as currency reserves, i.e., for regulating money supply and influencing exchange rates, do not have a sufficient connection to Switzerland. The only connection is that the assets are deposited in Switzerland.
Attachment in accordance with Art. 271 para. 1 no. 4 Federal Law on Debt Collection and Bankruptcy is possible, however, if the assets of the foreign central banks are used at a Swiss-domiciled bank for payments in connection with the creditor’s claim. The processing of payments through banks in Switzerland will in itself meet the requirement of “sufficient connection” stipulated by the law. Depending on how the foreign economy’s payment transactions with other countries are organized, this may give rise to difficult problems of subsuming such payments under Art. 271 Federal Law on Debt Collection and Bankruptcy. If payments to foreign countries are handled in a centralized fashion via the central bank, a sufficient connection between the claim and Switzerland may well exist in many cases. If payments to foreign countries are handled by commercial banks, it will probably seldom be the case that foreign central bank assets in Switzerland are linked to the enforced claim.
Zuberbühler D., Der Wandel des Aufsichtsrechts zur Risikoerfassung, in Aktuelle Rechts- probleme des Finanz- und Börsenplatzes Schweiz 6/1997, Berne 1998, pp. 89, 115 ff.
Committee on Banking Regulations and Supervisory Practices, International Convergence of Capital Measurement and Capital Standards, July 1988.
See Council directives 89/299/EEC, April 17,1989, on credit institutions’ own funds, 89/647/EEC, December 18, 1989, on solvency ratio for credit institutions, and 93/6/EEC, March 15, 1993, on the capital adequacy of investment firms and credit institutions.
Art. 12–13 Swiss Banking Ordinance; cf. Zuberbühler D., Revision des Bankengesetzes vom 18. März 1994 und der Bankenverordnung, in Aktuelle Rechtsprobleme des Finanzund Börsenplatzes Schweiz 3/1994, Berne 1995, pp. 31 f; Swiss Federal Banking Commission, Annual Report 1997, pp. 33 ff.; Swiss Federal Banking Commission, Bulletin 27/1995, Die neuen Eigenmittelvorschriften/Nouvelles dispositions en matière de fonds propres; Swiss Federal Banking Commission, Bulletin 34/1998, Die neuen Eigenmittelvorschriften für Markt-risiken/Nouvelles dispositions en matière de fonds propres pour les risques du marché.
See NZZ-Fokus No. 1, Shareholder-Value, Zurich 1996 passim.
JFT 105 III 120; Degrandi B., Rechtsprobleme des Lombardkredites, in: Swiss Review of Business Law 1990, pp. 1 ff., p. 4; Giovanoli M., Switzerland, in: European Banking Law, The Banker Customer Relationship, London 1993, pp. 183 ff., p. 217; Oftinger K./Bär R., Das Fahrnispfand, 3rd edition, Zurich 1981, volume IV. 2.c Zürcher Kommentar zum Schweizerischen Zivilgesetzbuch, p. 414; Thalmann Ch., Das Pfand- und Verrechnungsrecht nach den Allgemeinen Geschäftsbedingungen der Banken, in: Swiss Review of Business Law 1989, p. 136 ff., p. 138.
See Brunner Ch., Wertrechte - nicht verurkundete Rechte mit gleicher Funktion wie Wertpapiere, Zurich 1996, pp. 110 ff. regarding the Swiss “Federal Law on the Debt Register of the Confederation” for debt register claims and on money market book-entry securities. For Germany, see Canaris C.W., Grosskommentar Handelsgesetzbuch, Bankvertragsrecht 3rd volume, 3rd part, Berlin 1981, pp. 1037 ff.
Degrandi (FN 6), pp. 3 ff.
Exceptions to this principle are the public registers for chattels (see Art. 885 Civil Code), aircraft and ships.
See for Germany: Canaris (FN 7), p. 1029 f.; for Switzerland: Oftinger/Bär (FN 6), pp. 162–186.
Degrandi (FN 6), p. 4; Thalmann (FN 6), pp. 136 ff.
More precisely, co-ownership shares in these securities; see below after FN 60.
Giovanoli (FN 6), p. 220; Oftinger/Bär (FN 6), p. 520 f. It is disputed among legal writers whether the notification to the registrar, e.g., SEGA, is an indispensable requirement for the pledge.
See Bauer Th., Commentary on Art. 884 - 894 Swiss Civil Code, in Kommentar zum Schweizerischen Privatrecht, Schweizerisches Zivilgesetzbuch II, Art. 457–977 ZGB, Basel 1998, pp. 2011 ff., pp. 2044 ff.; Thalmann (FN 6), pp. 139, 141 f.
JFT 51 II 281 f; Oftinger/Bär (FN 6), pp. 134 f.
Art. 17 Federal Banking Act; see Bodmer D./Kleiner B./Lutz B., Kommentar zum Bankengesetz, Zurich 1997, N. 2 on Art. 17 Banking Act.
Art. 105 para. 1 Federal Law on International Private Law.
Heini A., Kommentar zu Art. 97 - 108 IPRG (Federal Law on International Private Law), in: IPRG-Kommentar, Zurich 1993, pp. 791 ff., p. 836.
Art. 105 para. 2 Federal Law on International Private Law, see Bauer (FN 14), p. 2065; Heini (FN 18), p. 837.
Art. 105 para. 3 Federal Law on International Private Law, see Heini (FN 18), p. 838.
Arts. 41 and 151–158 Federal Law on Debt Collection and Bankruptcy.
See Amonn K./Gasser D., Grundriss des Schuldbetreibungs- und Konkursrechts, 6th edition, Berne 1997, p. 261 ff.
Art. 156 in connection with Art. 125 ff. and 130 Federal Law on Debt Collection and Bankruptcy.
JFT 116 III 23, 106 Ib 91; Bauer (FN 14), pp. 2101 ff.; Giovanoli (FN 6), p. 217; Oftinger/Bär (FN 6), pp. 298 ff.
Art. 8 (abridged) of the General Conditions of Credit Suisse; see Degrandi (FN 6), p. 8; Oftinger/Bär (FN 6), pp. 298 ff.; Thalmann (FN 6), p. 138.
Bauer (FN 14), p. 2102 f. and p. 2105.
Bauer (FN 14), p. 2120 ff.; Oftinger/Bär (FN 6), pp. 303, 325.
Amonn/Gasser (FN 22), p. 263; Bauer (FN 14), p. 2106 f.; Degrandi (FN 6), p. 9.
Art. 198, Art. 199 para. 1 Federal Law on Debt Collection and Bankruptcy.
Art. 206 Federal Law on Debt Collection and Bankruptcy.
Art. 219, para. 1 Federal Law on Debt Collection and Bankruptcy; Amonn/Gasser (FN 22), pp. 342 ff.
Art. 206 para. 1 second sentence Federal Law on Debt Collection and Bankruptcy; Amonn/Gasser (FN 22), p. 332.
JFT 93 III 52; Art. 110 section 1 Code of Obligations.
Art. 287 para. 1, section 1 Federal Law on Debt Collection and Bankruptcy; Amonn/Gasser (FN 22), pp. 430 ff.
Art. 290 Federal Law on Debt Collection and Bankruptcy.
See Heinrich G., Rechtsvergleichende Aspekte der Verrechnung als Kreditsicherheit, in: Swiss Review of Business Law 1990, pp. 266 ff., pp. 270 f.
See Art. 120–125 Code of Obligations; Guhl Th./Merz H./Koller A., Das Schweizerische Obligationenrecht, 8th edition, Zurich 1991, pp. 275 ff.; Heinrich (FN 38), pp. 271 ff.
As an exception, a claim forfeited by the statute of limitations may be set off if at the time when it could have been set off against the other claim, it was not yet forfeited under the statute of limitations (Art. 120 para. 3 Code of Obligations).
Art. 124 para. 1 Code of Obligations.
Art. 125 para. 1 in connection with Art. 481 Code of Obligations; see Thalmann (FN 6), p. 140.
Heinrich (FN 38), p. 270 f.; Thalmann (FN 6) pp. 140 f.; von Tuhr A./Escher A., Allgemeiner Teil des schweizerischen Obligationenrechts, 3rd edition, Vol. II, Zurich 1974, p. 208 f.
Art. 8 (abridged) of the General Conditions of Credit Suisse.
Thalmann (FN 6), p. 140.
JFT 104 II 192, 100 III 83; Aepli V., Kommentar zu Art. 114–126 Obligationenrecht, volume V.l.h, Zürcher Kommentar zum Schweizerischen Zivilgesetzbuch, 3rd edition Zurich 1991, p. 54 f.; Kleiner B., Bankkonto-Giro-und Kontokorrentvertrag, in Innominatverträge, Festgabe zum 60. Geburtstag von W.R. Schluep, Zurich 1988, pp. 273 ff., 275 f.
Acknowledgement of the balance implies novation (Art. 117 para. 2 Code of Obligations). A balance is regarded as acknowledged if it has been submitted to both parties and been tacitly or explicitly approved. In practice, the nonbank customer’s balance is acknowledged on receipt of a statement of account. According to the general conditions of the Swiss banks, statements of accounts are deemed to have been approved if the customer raises no objections within one month. After the one-month period has elapsed, novation occurs. Novation is not an abstract legal transaction. The current account debtor still has the possibility of providing evidence to the effect that the acknowledged debt had never actually existed. The party concerned might contest erroneous entries. The acknowledgment of the balance, however, implies that the respective party will refrain from asserting deficiencies of intention previously known, as also from raising contentious and doubtful objections unless this right remains explicitly reserved (JFT 100 III 85 f., 104 II 196).
Art. 148 para. 3 in connection with Art. 116 Federal Law on International Private Law; see Aepli (FN 46), p. 170.
Art. 117 para. 3 let. c. Federal Law on International Private Law.
Art. 148 para. 2 Federal Law on International Private Law.
See Aepli (FN 46), pp. 166 ff.; Heinrich (FN 38), p. 282.
von Tuhr/Escher (FN 43), p. 207 f.
Aepli (FN 46), p. 298 f.
Aepli (FN46), pp. 152 ff.
Art. 213 para. 1 Code of Obligations; Art. 213 para. 1 Federal Law on Debt Collection and Bankruptcy.
Aepli (FN 46), N. 7 on Art. 123 Code of Obligations; Heinrich (FN 38), pp. 278 f.
Art. 213 para. 2 Federal Law on Debt Collection and Bankruptcy.
Art. 214 Federal Law on Debt Collection and Bankruptcy.
Guhl/Merz/Koller (FN 39), p. 275.
Regarding France, see Brunner (FN 7), pp. 89 ff. and Zobl D./Lambert C., Zur Entmaterialisierung der Wertpapiere, in Swiss Review of Business Law 1991, pp. 117 ff., pp. 122 ff.; regarding the USA, see Brunner (FN 7), pp. 99 ff.
Regarding Germany, see Canaris (FN 7), pp. 1019 ff; regarding Switzerland, see Brunner (FN 7), pp. 30 f., Meier-Hayoz A., Abschied vom Wertpapier, in Zeitschrift des Bernischen Juristenvereins 1986, pp. 385 ff., p. 396.
Brunner (FN 7), pp. 32 ff., p. 211; Canaris (FN 7), p. 1023, pp. 1026 f., p. 1031; Kleiner B., Zäher Abschied vom Wertpapier im Effektenbereich, in Swiss Review of Business Law 1995, pp. 290 ff., p. 293; Zobl/Lambert (FN 60), p. 132.
See European Monetary Institute, The Single Monetary Policy in Stage Three, Specification of the Operational Framework, pp. 37, 93.
See European Monetary Institute (FN 63), p. 90.
European Monetary Institute (FN 63), p. 40.
See Europäisches Währungsinstitut, Die einheitliche Geldpolitik in Stufe 3, Festlegung des Handlungsrahmens, Frankfurt September 1997, pp. 41–42.
Meier-Hayoz (FN 61), p. 392 f.
Brunner (FN 7), pp. 20 ff.; Meier-Hayoz (FN 61), p.393; Zobl/Lambert (FN 60), p. 126.
Art. 2 let. a Stock Exchange Act.
Brunner (FN 7), pp. 213 ff.
Brunner (FN 7), pp. 218 ff.; still hesitating: Schlussbericht der Groupe de réflexion “Gesellschaftsrecht” of September 24, 1993, p. 79.
Regarding the “Record-based Approach” of the “lex situs” issue, see Benjamin J., Immobilised Securities: Where are they?, in Butterworths Journal of International Banking and Financial Law 1998, pp. 85 ff., and the new legislation in Luxembourg, in particular Article 1 of the “Règlement grand-ducal du 7 juin 1996 portant modification du règlement grand-ducal modifié du 17 février 1971 concernant la circulation des valeurs mobilières”; regarding the bankruptcy of the central depository note that to some extent vindicatio is already possible for claims not incorporated in securities in case of a bank’s bankruptcy, see Brunner (FN 7), pp. 272 ff. on Art. 16 and 37b Banking Act.
For further references see Giovanoli M., Legal Issues Regarding Payment and Netting Systems, in Current Legal Issues Affecting Central Banks, Vol. 4, Washington 1997, pp. 517 ff.; Hess M., Netting in Switzerland, in Butterworths Journal of International Banking and Financial Law 1995, pp. 310 ff.; Hess M./Wyss A., Die rechtlichen Grundlagen des Netting, unter besonderer Berücksichtigung des Close-out Netting (Art. 211 Abs. 2bis SchKG), in: Allgemeine Juristische Praxis 1997, pp. 1219 ff.
In Switzerland, this is reflected in recent legislation: Art. 211 Abs. 2bis Federal Law on Debt Collection and Bankruptcy, Art. 12f Banking Ordinance; see Bulletin 27/1995 of the Swiss Federal Banking Commission (FN 4), pp. 55 ff., Hess/Wyss (FN 74), pp. 1229 f.; for references for other jurisdictions see Giovanoli (FN 74), pp. 532 ff.
Art. 12a No. 5.3 Banking Ordinance.
Art. 12a section 1.4 Banking Ordinance.
Art. 24 para. 2 let. i Banking Ordinance; see Bodmer/Kleiner/Lutz (FN 16), N. 88 on Art. 16 Banking Act.
Bodmer/Kleiner/Lutz (FN 16), N. 90 on Art. 16 Banking Act.
See Art. 12f Banking Ordinance and after FN 73 above.
General accounting rules in Switzerland allow the compensation of claims denominated in different but freely convertible currencies unless one of the claims is based on an agreement that stipulates the literal performance in a defined currency (so called “effective clause”); see Revisonshandbuch (FN 79), p. 132.
See Basle Committee on Banking Supervision, Consultative paper on on-balance-sheet netting, April 7, 1998.
See British Bankers Association, Amendment to the Basle capital accord on weighting of investment firms and consultation on on-balance-sheet netting, April 9, 1998.
Amonn/Gasser (FN 22), p. 172.
The new provision of Art. 92 no. 11 Federal Law on Debt Collection and Bankruptcy is anchored in the Federal Court’s well established practice. The practice adopted by the courts and authorities with regard to the attachment against foreign states’ assets in Switzerland was last set out in a circular from the Federal Judiciary and Police Department dated July 8, 1986; see Verwaltungspraxis der Bundesbehörden (VPB) 1986 II, p. 275 ff.
JFT 110 II 259; Memorandum of the Federal Ministry of Foreign Affairs dated August 28, 1996, published in Swiss Review of International and European Law 1997, pp. 650 ff., 651.
Egli J.F., L’immunité du juridiction et de l’exécution des Etats étrangers et des leurs agents dans la jurisprudence du Tribunal fédéral, in Festschrift 100 Jahre SchKG, Zürich 1989, S. 201 ff., p. 206, JFT 113 Ia 176, 110 II 259 f.
Brownlie Ian, Principles of Public International Law, 4th edition Oxford 1990, p. 327, 332 ff.; Müller J.P./Wildhaber L., Praxis des Völkerrechts, 2. Auflage Bern 1982, p. 298; Verdross A./Simma B., Universelles Völkerrecht, 3. Auflage 1984, p. 763 f.; JFT 106 Ia 147.
See ruling of the Federal Court on January 24, 1994, published in Swiss Review of International and European Law 1995, p. 593 ff.
The Federal Court regards the European Convention on State Immunity as the manifestation of recent trends in international law (Egli (FN 88), p. 205; JFT 110 Ia 45, 104 Ia 372) while admitting that two aspects of the system put forward in the Convention diverge from Swiss jurisdiction (JFT 112 Ia 150; 111 Ia 156); Art. 23 of the Convention provides for absolute reciprocal immunity against execution proceedings between the signatories; Art. 20 of the Convention stipulates a far-reaching mutual obligation to recognize and enforce court rulings in the other signatories’ countries.
Vischer F., Bemerkungen zur Immunität des Ausländischen Staates anhand des Bundesgerichtsentscheides 110 II 255, in Schweizerisches Jahrbuch für Internationales Recht 1986, S. 236 ff., p. 245.
JFT 120 II 409; 113 Ia 175; 111 Ia 58; 104 Ia 374; 86 I 29.
JFT 110 II 260; 86 I 29.
JFT 82 I 91, 44 I 49.
Federal Court ruling of June 22, 1966, consideration 7, in Schweizerisches Jahrbuch für Internationales Recht 1975, p. 224.
Cf. Brownlie (FN 89), p. 332 ff., Vischer (FN 92), p. 243 f. and the Federal Court ruling of January 24, 1994, published in Swiss Review of International and European Law 1995, p. 594 f. and JFT 111 Ia 58 f.; dissenting opinion: Gramlich would rely solely on the law of the country affected; see Gramlich L., Staatliche Immunität für Zentralbanken?, in Rabels Zeitschrift für ausländisches und internationales Privatrecht, 45 (1981), pp. 545 ff., p. 586.
JFT 111 Ia 65 f.; 110 Ia 45 f.; Egli (FN 88), p. 212; Verdross/Simma (FN 89), p. 772.
JFT 110 Ia 46; compare JFT 120 II 321 ff. for the status of Cantonal banks competing freely with commercial banks in Switzerland.
JFT 106 I 148; Egli (FN 88), p. 209.
Vischer (FN 92), p. 248.
JFT 104 Ia 370; 56 I 251.
JFT 113 Ia 175; 104 Ia 370; 56 I 251.
Egli (FN 88), p. 208.
JFT 120 II 407 and 411.
JFT 86 I 30, Egli (FN 88), p. 209.
JFT 56 I 251 f.
JFT 106 Ia 150; Botschaft des Bundesrates vom 8. Mai 1991 über die Änderung des Bundesgesetzes über Schuldbetreibung und Konkurs (Federal Law on Debt Collection and Bankruptcy), in Bundesblatt 1991 III, pp. 1 ff., p. 163.
Federal Court ruling of January 24, 1994, published in Swiss Review of International and European Law 1995, p. 595, consideration 5; JFT 112 Ia 151; 108 III 109 f.; Brownlie (FN 89), p. 331, Verdross/Simma (FN 89), p. 771.
Note of the Directorate for Public International Law of February 28, 1991, Swiss Review of International and European Law 1992, p. 271; Vischer (FN 92), p. 245 f.
Note of the Directorate for Public International Law of February 28, 1991, Swiss Review of International and European Law 1992, p. 271; Brownlie (FN 89), p. 344.
JFT 86 I 32; Egli (FN 88), p. 211; Note of the Directorate for Public International Law of February 28, 1991, Swiss Review of International and European Law 1992, p. 271.
Federal Court ruling of January 24, 1994, published in Swiss Review of International and European Law 1995, p. 594 f., consideration 4/5.
NZZ of August 13, 1997, p. 21.
JFT 111 Ia 64 ff.
JFT 110 Ia 43 ff.
See text at FN 98 above.
Art. 92 no. 11 Federal Law on Debt Collection and Bankruptcy.
See Bericht der Expertengruppe “Reform der Währungsverfassung,” Der neue Geldund Währungsartikel in der Bundesverfassung, Berne, October 24, 1997.
See Botschaft des Bundesrates vom 17. März 1997 über die Revision des Nationalbankgesetzes, in: Bundesblatt 1997 II, S. 977 ff.
Swiss National Bank, Annual Report 1997, p. 34.
Botschaft NBG (FN 126), p. 998.
Botschaft NBG (FN 126), p. 998; Schürmann L., Kommentar und Textausgabe Nationalbankgesetz und Ausführungseriasse, Bern 1980, N. 2 and N. 7 on Art. 19 National Bank Act.
Cf. Zurlinden M., Devisenmarktinterventionen der Schweizerischen Nationalbank 1986–1994, in: Quartalsheft SNB No. 2/1996, p. 163 ff.
Schürmann (FN 129), Art. 14 National Bank Act, N. 43.
Klauser P., Geld und Gold - Zur Reform der schweizerischen Währungsverfassung, in: Aktuelle Rechtsprobleme des Finanz- und Börsenplatzes Schweiz, Bern 1997, pp. 15 ff., p. 31; Lusser M., Auf dem Weg zu einer neuen schweizerischen Geldverfassung - Preisstabilität und Unabhängigkeit: Die Anker der Notenbank, in Quartalsheft SNB 2/1996, p. 155 ff., 160.
Bericht der Expertengruppe (FN 125), p. 48; Botschaft NBG (FN 126), p. 980; Swiss National Bank, Annual Report 1997, p. 36; Swiss National Bank, [German] Annual Report 1991, pp. 64 ff.
Botschaft NBG (FN 126), p. 981.
Egli (FN 88), p. 212 f., referring to an unpublished ruling of May 4, 1983.
It is important, when addressing a Swiss court, to be able to substantiate the claim that a sovereign purpose is served. The Libyan central bank failed because it was unable to document this claim; see JFT 111 Ia 66.
Gilliéron P.R., Le séquestre dans la LP révisée, in Blätter für Schuldbetreibung und Konkurs (1995), S. 121 ff., p. 121 f.
Art. 272 Abs. 1 Federal Law on Debt Collection and Bankruptcy.
Meier-Dieterle, F.C., Der “Ausländerarrest” im revidierten SchKG - eine Checkliste, in Allgemeine Juristische Praxis (1996), pp. 1416 ff., p. 1425; Ottoman R., Der Arrest, in Aktuelle Fragen des Schuldbetreibungs- und Konkursrechts nach revidiertem Recht, herausgegeben von I. Meier, Basel (1996), pp. 55 ff., p. 69.
Stoffel W.A., Das neue Arrestrecht in: Allgemeine Juristische Praxis (1996), pp. 1401 ff., p. 1409.
Vogel Oscar, Grundriss des Zivilprozessrechts, 4th edition, Berne 1995, 10th chapter, N. 26.
Specialized laws such as those on taxation and customs duties enumerate other grounds for attachment.
Amonn/Gasser (FN 22), p. 409; Meier-Dieterle (FN 140), p.1421; Ottomann (FN 140), p. 64 f.
Art. 30a Federal Law on Debt Collection and Bankruptcy; Stoffel (FN 141), p. 1405.
An exception to this “due payment” rule is set out in Art. 271 para. 2 Federal Law on Debt Collection and Bankruptcy for attachment in the event of absence of a fixed place of residence (Art. 271 para. 1 no. 1 Federal Law on Debt Collection and Bankruptcy) and of dishonest conduct by the debtor (Art. 271 para. 1 no. 2 Federal Law on Debt Collection and Bankruptcy).
See Judgment of the Higher Court of the Canton of Zurich of September 14, 1994, published in ZR 95 (1996), No. 87.
See III. A. 1. above.
Judgment of the Higher Court of the Canton of Zurich of February 23, 1995, cited in Meier- Dietcrle (FN 140), p. 1419, FN 32.
In contrast to ordinary civil proceedings on pecuniary disputes, in which the court may impose the burden of proof to the parties to supply evidence of the contents of the governing foreign law (Art. 16 para. 1 Federal Law on International Private Law).
Art. 92 no. 11 by contrast with Art. 275 Federal Law on Debt Collection and Bankruptcy; see II. F. above.
Gasser D., Das Abwehrdispositiv der Arrestbetroffenen nach revidiertem SchKG, in ZBJV 130 (1994), pp. 582 ff., p. 594 f.; Meier-Dieterle (FN 140), p. 1420; Stoffel (FN 141), p. 1408.
Gasser (FN 152), p. 594 f.; Ottomann (FN 140), p. 70, Stoffel (FN 141), p. 1408.
JFT 107 III 33 ff. Kleiner B., Ausländerarrest-Kompromiss zwischen Schuldnerverfolgung und Schädigung der eigenen Wirtschaft, in Festschrift 100 Jahre SchKG, Zürich 1989, S. 371 ff., p. 375 ff.; Ottomann (FN 140), p. 70; Stoffel (FN 141), p. 1408.
JFT 107 III 149, 112 III 95 ff.; Kroll M.J., Arrest von Wertrechten in Sammelverwahrung, in Swiss Review of Business Law 1994, p. 244.
JFT 107 III 150 f.
JFT 107 III 38; Amonn/Gasser (FN 22), p. 412 f.; Ottomann (FN 140), p. 69; Stoffel (FN 141), p. 1408.
Stoffel (FN 141), p. 1408.
Gani L., Le “lien suffisant avec la Suisse” et autres conditions du séquestre lorsque le domicile du débiteur est à l’étranger (Art. 271 al. ler ch. 4n LP) in Swiss Law Journal 92 (1996), S. 227 ff., p. 227.
Amonn/Gasser (FN 22), p. 409; Meier-Dieterle (FN 140), p. 1420; Ottomann (FN 140), p. 65.
Botschaft SchKG (FN 110), p. 162 f.; Gani (FN 159), p. 22; Gilliéron (FN 138), p. 122 ff.; Ottomann (FN 140), p. 66.
Gasser (FN 152), p. 591 f.; Gilliéron (FN 138), p. 122 ff.; Kleiner, p. 373.
Gani (FN 159), p. 22; Gilliéron (FN 138), p. 125; Ottomann (FN 140), p. 66.
As discussed above; cf. Botschaft SchKG (FN 110), p. 163; Gilliéron (FN 138), p. 128; Kleiner, p. 373.
Gani (FN 159), p. 230 f.; Stoffel (FN 141), p. 1407.
JFT 123 III 496, Gani (FN 159), p. 229/231; Gilliéron (FN 138), p. 128; Meier-Dieterle (FN 140), p. 1421; Ottomann (FN 140), p. 67; Stoffel (FN 141), p. 1407.
Amonn/Gasser (FN 22), p. 410; Gani (FN 159), p. 230; Meier-Dieterle (FN 140), p. 1422; Ottomann (FN 140), p. 66 f.; Staehelin D., Die internationale Zuständigkeit der Schweiz im Sehuldbetreibungs- und Konkursrecht, in Allgemeine Juristische Praxis (1995), S. 259 ff., p. 269; Stoffel (FN 141), p. 1407.
Amonn/Gasser (FN 22), p. 410; Gani (FN 159), p. 230; Meier-Dieterle (FN 140), p. 1422; Ottomann (FN 140), p. 66 f.; Stoffel (FN 141), p. 1407.
Gani (FN 159), p. 230; Meier-Dieterle (FN 140), p. 1422; Stoffel (FN 141), p. 1407.
JFT 123 III 494 ff.; Amonn/Gasser (FN 22), p. 410; Gani (FN 159), p. 230; Meier-Dieterle (FN 140), p. 1422; Ottomann (FN 140), p. 66 f.; Stoffel (FN 141), p. 1407.
Gani (FN 159), p. 231 f.; Meier-Dieterle (FN 140), p. 1422; Stoffel (FN 141), p. 1407.
Amonn/Gasser (FN 22), p. 410; Gani (FN 159), p. 231; Meier-Dieterle (FN 140), p. 1422; Stoffel (FN 141), p. 1407.
Amonn/Gasser (FN 22), p. 410; Gani (FN 159), p. 231; Meier-Dieterle (FN 140), p. 1422; Ottomann (FN 140), p. 67; Stoffel (FN 141), p. 1407.
Gani (FN 159), p. 230; Meier-Dieterle (FN 140), p. 1422.
Meier-Dieterle (FN 140), p. 1422 f.; Stoffel (FN 141), p. 1406; dissenting opinion: Gani (FN 159), p. 228, who merely requires evidence of the absence of ordinary right of appeal in the country of origin.
Meier-Dieterle (FN 140), p. 1423 f.
Amonn/Gasser (FN 22), p. 128 f.; Meier-Dieterle (FN 140), p. 1424; Ottomann (FN 140), p. 66; Stoffel (FN 141), p. 1406.
Ottomann (FN 140), p. 66.
Gani (FN 159), p. 228 ff.; Meier-Dieterle (FN 140), p. 1424; Ottomann (FN 140), p. 66; Stoffel (FN 141), p. 1406.
In the Canton of Zurich this is the sole judge in summary procedures.
In the Canton of Zurich this is the nullity appeal to the Cantonal Court of Appeal.
Amonn/Gasser (FN 22), p. 416.
Botschaft SchKG (FN 110), p. 171.
Gasser (FN 152), p. 604 f.
Gasser (FN 152), p. 605.
Botschaft SchKG (FN 110), p. 173; Meier-Dieterle (FN 140), p. 1426.
See II. F. above. Cf. Amonn/Gasser (FN 22), P. 420; Gasser (FN 152), p. 610.
Gilliéron (FN 138), p. 137 f.; Ottomann (FN 140), p. 76.
Gilliéron (FN 138), p. 138; Spühler K., Die Praxis der staatsrechtlichen Beschwerde, Bern 1994, p. 157.

References: Art. 924
 Art. 888
 Art. 899
 Art. 899
 Art. 899
 Art. 25
 Art. 271
 Art. 271

Art. 12
 Art. 885
 Art. 884
 Art. 457

Art. 17
 Art. 17

Art. 105
 Art. 97

Art. 105

Art. 105

Art. 156
 Art. 125

Art. 8

Art. 198
 Art. 199

Art. 206

Art. 219

Art. 206
 Art. 110

Art. 287

Art. 290
 Art. 120

Art. 124

Art. 125
 Art. 481

Art. 8
 Art. 114

Art. 148
 Art. 116

Art. 117

Art. 148

Art. 213
 Art. 213
 Art. 123

Art. 213

Art. 214

Art. 2
 Art. 16
 Art. 211
 Art. 12

Art. 12

Art. 12

Art. 24
 Art. 16
 Art. 16
 Art. 12
 Art. 92
 Art. 23
 Art. 20

Art. 92
 Art. 19
 Art. 14

Art. 272

Art. 30
 Art. 271

Art. 92
 Art. 275