Outsourced public service providers operate at a challenging interface: they are expected to act in an entrepreneurial manner, yet remain bound by public interests, legal requirements and political accountability. These multiple obligations call for clear rules governing responsibilities, oversight, transparency and control.

Recent reports on the Lucerne Social Insurance Centre WAS serve as a prime example of the issues that can arise when strategic and operational roles are not clearly separated. The focus here is not merely on individual accounts or meeting minutes, but on the governance structure as a whole.

For boards of directors, executive boards, departments and local authorities, the following questions, amongst others, arise:

An organisation can fulfil its tasks efficiently and cost-effectively whilst at the same time exhibiting significant governance weaknesses. This is demonstrated by the expert report on the internal investigations conducted by Professor Isabelle Häner at WAS. Good operational performance is no substitute for clear processes.

Conflicts of role and interest

The combination of different roles is a particularly sensitive issue. Members of the board of directors are expected to provide strategic oversight of the organisation. If they simultaneously take on operational duties or have a contractual relationship with an affiliated company, conflicts of loyalty, information and interest may arise.

This does not automatically mean that a particular course of action is unlawful. However, it does mean that the organisation requires robust rules. These include, in particular:

Particularly in the case of outsourced public tasks, the question is not merely what is legally permissible. It is equally important whether a process is transparent, institutionally sound and can be accounted for to politicians, the public and supervisory bodies.

Remuneration requires a system

Remuneration models often only come under scrutiny when ambiguities arise. An amount may ultimately be appropriate yet still appear unreliable or difficult to trace due to a lack of processes.

A robust system should therefore distinguish between four levels:

Individual contracts awarded to board members deserve particular attention. Whilst they may be objectively justified, they carry an increased risk of self-contracting or self-approval, a blurring of roles and inconsistent billing. Depending on the organisation, a flat-rate basic remuneration combined with strictly regulated additional contracts may therefore be the better solution. It is advisable to establish a general framework, whilst also providing for a specific process at the operational level. For example, a dual-control principle must also be implemented in concrete terms. What is crucial is not merely that ‘someone’ approves, but who checks what for whom, at what level of the hierarchy, and on the basis of which documents.

Compliance, Internal Control Systems and Management Accounting (“Good Governance”)

Compliance is more than simply adhering to individual laws. It involves establishing a system that enables lawful, ethical and transparent conduct.

For public institutions and outsourced service providers, this includes in particular – depending on the institution’s size, focus and ownership strategy:

In this context, financial control must not be limited to the final figure – a tailored and effective internal control system is required. This system must also be able to verify how an amount arose, who requested it, who approved it and whether the underlying service was provided.

Digital audit trails as a governance tool

Digital systems can significantly improve traceability. However, they are no substitute for a clear chain of responsibility. An electronic workflow is only useful if roles, approvals and rights to make changes are correctly defined.

In practice, the following questions, amongst others, should be answered:

Version control is particularly crucial for records. Subsequent editorial corrections must be distinguishable from changes to the content. A digital audit trail not only ensures the reliability of evidence but also builds trust.

Independent assessment with a sense of proportion

An external investigation must not lead to either a prejudgement or a blanket exoneration. Its quality is demonstrated by whether it clearly distinguishes between the relevant facts:

Equally important is the distinction from ongoing regulatory, criminal or political proceedings. An investigation can identify governance shortcomings without assessing criminal liability. Conversely, the absence of a breach of the rules may mean that processes still need to be improved.

BPS Legal supports companies, institutions, outsourced public service providers and local authorities in the legal and organisational assessment of such issues. Matthias R. Schönbächler, MLaw, solicitor and partner, combines perspectives from public law, commercial law and digital law. BPS Legal advises and assists with:

Our team would be excited to discuss your specific situation with you in person and in confidence. Please feel free to contact us anytime with any questions regarding governance, public law and commercial law.

Media reports are increasingly covering cases of influencers and private individuals filing criminal complaints because deceptively real pornographic photos and videos of them are being created and distributed using artificial intelligence (AI). Given the shocking quality of these forgeries, there is often a perception that Swiss law is lagging behind this development and that a dangerous legal vacuum exists.

This assessment is incorrect. Although the Swiss Criminal Code does not contain a provision titled “deepfake ban,” the Swiss legal system provides a robust set of instruments to effectively defend against this form of digital abuse.

From photo manipulation to AI forgery: a technological escalation

The manipulation of images to degrade individuals is not a new phenomenon. As early as 2018, politician Jolanda Spiess-Hegglin was the victim of manipulated pornographic depictions. At that time, however, these were still relatively simple photo montages.

The key difference today lies in the quality and accessibility of the technology. Modern AI applications enable even laypersons to generate hyper-realistic video and image sequences with minimal effort—so convincing that even close acquaintances can hardly recognize them as fake. This perfection of deception massively amplifies the psychological burden and social harm for those affected.

Criminal law protection against deepfake pornography

Contrary to some opinions, creators and distributors of deepfake pornography do not act with impunity. Several criminal offences according to the Swiss Criminal Code (SCC) may be relevant.

Naturally, the applicability of these offences must be assessed on a case-by-case basis.

Civil law protection against deepfake pornography

The most effective and direct protection for affected individuals lies in civil law. The creation and dissemination of deepfake pornography constitutes a serious unlawful infringement of personality rights. In particular, the right to one’s own image is fundamentally violated. The Federal Supreme Court has clearly held that no one may be depicted without their consent—especially not in a manipulated, intimate, and degrading context.

Affected individuals have powerful legal tools at their disposal:

Practical challenges in addressing deepfake pornography

What is lacking are low-threshold reporting mechanisms or private initiatives such as #NetzPigCock|, including an online tool against unsolicited explicit images. In addition, many of the websites and platforms on which pornographic content is shared allow users to act anonymously, meaning that perpetrators often remain unknown at first.

It is therefore all the more important to document the relevant content and the accounts involved. This remains crucial for both civil and criminal enforcement against deepfake pornography. At the same time, content and accounts should first be reported to the respective websites and platforms and requested to be removed. Such content often also violates the platforms’ own policies. Knowledge of the perpetrator is not required for criminal proceedings. If the perpetrator is known or if the website or platform does not promptly remove the content, civil action is recommended.

Nevertheless, victim support and advisory services are available in Switzerland to assist affected individuals with various steps. Given the novelty and complexity of the phenomenon, legal assistance is highly advisable.

Conclusion

Deepfake pornography is not a phenomenon without legal remedies. Swiss law provides a dense network of criminal and civil provisions to effectively defend against it. The protection of personality rights under the Civil Code proves to be a central and powerful tool.

Please feel free to contact us with any questions you may have regarding right to the protection of your personality.

Smartphones are now often the central evidence hub in criminal proceedings. Almost everyone carries one, which makes them one of the most important data carriers for investigators. That is precisely why access to them must never become a legal vacuum; an effective sealing procedure upon seizure is needed as a safeguard for privacy, personality rights, and professional secrecy.

Law enforcement is under pressure to review digital evidence quickly, while affected individuals often can only challenge a search with a significant delay. That tension is exactly what makes sealing so essential.

Why this issue matters now

Recent media reporting points to a marked rise in sealing-related proceedings involving smartphones; in Zurich alone, the number is said to have increased by 75 percent. At the same time, the federal authorities are working on more efficient procedures for securing electronic evidence while expressly emphasizing data protection and procedural rights.

This shows two things: digital evidence has become indispensable for criminal prosecutors, but the rule-of-law safeguards must operate with equal seriousness. If sealing and unsealing are not handled promptly and carefully, irreparable intrusions into highly sensitive personal data can follow.

The role of sealing

Sealing is not a technical footnote; it is a core procedural safeguard for sensitive information upon seizure. Anyone whose devices or documents are seized and who invokes confidentiality interests can request that the contents remain sealed until a court decides whether inspection is allowed.

This is especially important for smartphones, because they often contain an exceptionally broad digital footprint: chats, photos, health data, location history, work documents, and private communications. A search therefore almost inevitably interferes with privacy and must be justified with particular care.

What the court must assess

In unsealing proceedings, the question is not simply whether the public prosecutor would like to review the data. The compulsory measures court must also determine whether there is sufficient suspicion of an offence and whether the search is proportionate.

This review is crucial in digital cases because the interference is so far-reaching. Authorities must not access an entire device on a blanket basis if the relevant information can already be narrowed down more precisely, or if protected secrets outweigh the investigative interest.

Current developments and practical problems

The current debate around digital evidence reveals a structural problem: proceedings often take too long, even though digital data can quickly lose evidentiary value or appear in massive volumes. At the same time, the affected person’s duty to cooperate is sometimes applied too strictly in practice, although the Federal Supreme Court has stressed in relevant cases that substantiated disclosures can be sufficient.

Added to this is the new statutory three-day deadline for filing a sealing request after seizure, which has been described in legal commentary as a significant tightening and a potential trap. Missing that deadline, or failing to justify the request properly, can mean the irreversible loss of protection.

Why this matters for personality rights

The right to sealing protects not only lawyers, journalists, and other holders of professional secrecy, but ultimately every person whose most intimate life domains are stored on a device. A smartphone search often provides a comprehensive view of someone’s digital life, far beyond what is relevant to the criminal proceedings.

For that reason, the rule of law must not weaken the sealing mechanism simply because some courts have not yet fully adapted to the pace of technological change. The correct response is not less legal protection, but more precise procedures, faster judicial review, and stricter reasoning requirements for any intrusion.

Conclusion

In digital criminal proceedings, sealing is not a luxury; it is a rule-of-law necessity. Especially with smartphones and other data carriers, it determines whether privacy remains effectively protected or whether sensitive data are disclosed too early.

Anyone who wants to make searches of digital devices easier must not gradually dismantle the protection of affected persons. A functioning sealing procedure is the condition for keeping criminal prosecution, personality rights, and privacy in fair balance.

Decision 2C_47/2025 of 27 March 2026 – Labelling of vegan products

The Federal Supreme Court has ruled that the term ‘milk’ may not be used in connection with vegan drinks – not even in a modified or ironic form. In the case of an oat drink bearing the label ‘SHHH… THIS IS NOT M[*]LK’, the Federal Supreme Court upheld the ban imposed by the Zurich Cantonal Laboratory. Even the stylised spelling, with a drop symbol in place of the ‘i’, is sufficient to give the impression of a reference to milk.

The court based its decision on its 2025 case law (decision 2C_26/2023), according to which terms such as ‘milk’, ‘cream’ or ‘yoghurt’ are protected designations for animal products under the Federal Act

on Foodstuffs and Consumer Products (Foodstuffs Act, FSA) and the Foodstuffs Ordinances. Such terms may only be used for products that are actually made from milk of animal origin.

Focus on differentiation and consumer protection

The Federal Supreme Court emphasises that the term ‘milk’ raises clear expectations among consumers – particularly with regard to nutritional value, composition and origin. A ‘negative claim’ (‘this is not milk’) does not alter this, because the connection to real milk is deliberately established. The decision provides legal certainty for manufacturers, inspectors and consumers and sends a further signal in favour of transparent labelling in the growing market for vegan alternatives.

Administrative procedures for the placing of foodstuffs on the market

The authorisation and supervision of foodstuffs in Switzerland is governed by the Ordinance on Foodstuffs and Consumer Goods (LGV; SR 817.02). The Federal Food Safety and Veterinary Office (BLV) is responsible for coordinating enforcement, whilst the cantons (e.g. the Zurich Cantonal Laboratory) carry out enforcement.

Anyone wishing to place a food product on the market must, in particular, ensure:

Special provisions apply to so-called ‘novel foods’. Breaches result in a ban on placing the product on the market, as in the present case, sometimes accompanied by administrative proceedings up to the Federal Supreme Court.

International trend towards clear labelling

The Federal Supreme Court’s ruling is part of a European and international trend calling for a clear linguistic distinction between animal-based and plant-based foods. In the European Union, the term ‘milk’ is reserved exclusively for animal products under EU Regulation No 1308/2013. The same applies to terms such as ‘cheese’ or ‘butter’.

The European Commission and national authorities – such as the Federal Ministry of Food and Agriculture (BMEL) in Germany – emphasise the importance of uniform and transparent product labelling so as not to mislead consumers. The recent EU dispute over the terms ‘veggie burger’ or ‘veggie schnitzel’ shows that whilst legislators are granting more leeway for plant-based products, they are simultaneously drawing clear boundaries as soon as protected terms such as ‘milk’ are involved.

Switzerland – albeit as a non-EU member – thus follows a similar line to the EU: Consumer protection and legal certainty take precedence over creative wordplay in marketing.

Conclusion

The new ruling makes it clear: creativity in the marketing of vegan products has legal limits. Anyone selling plant-based alternatives must adhere to the labelling rules of food law – even if playful wordplay appears attractive from a marketing perspective.

Dear Partners and Clients

The year is approaching its end. We would like to thank you for the excellent cooperation this year and look forward to more pleasant encounters next year. We wish you a Merry Christmas, a relaxing winter break and a Happy New Year.

Our office will be closed from the afternoon of December 24, 2025 until and including January 2, 2025. We look forward to returning to work with renewed vigour on 5 January 2026. In urgent cases, please contact us at info@bps-legal.ch.

Your expert for travel law

Whether it’s a cancelled flight, lost luggage or trouble with the tour operator – Julius Paulicka will stand up for your rights. As a specialist in travel law and a lawyer admitted in Switzerland and Germany, I know the stumbling blocks on holiday and will help you to assert your claims if the anticipation of your trip is spoilt.

Travelling from Switzerland – your rights know no bounds

Switzerland is strongly orientated towards European standards when it comes to regulating travel rights. Package holidays in Switzerland are governed by the Federal Package Travel Act, which is based on the EU Package Travel Directive. As a result, Swiss travellers benefit from comprehensive protection in the event of defects, service deviations and in the event of the tour operator’s insolvency. Individual travellers also benefit from clear claims in the event of defects and can demand compensation if the requirements of the Code of Obligations are met.

Flight rights – enforcement in Switzerland too

In the event of flight delays or cancellations and problems with baggage, Swiss consumers can often also rely on the EU Air Passenger Rights Regulation (EC No. 261/2004), as this is often applicable under bilateral agreements and in air transport – for example, if the departure takes place in Switzerland or an EU country. The case law of the Court of Justice of the European Union (CJEU) is also regularly taken into account by Swiss courts, as Switzerland has expressly recognised the primacy of international law within the framework of the Agreement on the Free Movement of Persons.

Competent advice on all travel law issues

As a specialist in travel law, I will help you to enforce your rights. Not with empty phrases, but with sound expertise, empathy and a genuine understanding of your situation, I will support you in

Special features for Swiss travellers

Even though Switzerland is not a member of the EU, Swiss travellers benefit from the association with important EU legal acts in the area of travel and consumer protection. The application of European air passenger rights and the recognition of corresponding ECJ case law are an integral part of the Swiss legal framework in travel law according to the current interpretation.

Your advantage with a specialised law firm in Central Switzerland

Travel relaxed – I will take care of your rights in the event of a dispute. Contact me for a non-binding initial assessment.

Employment relationships in the public sector differ from private labour law in key respects. A recent decision by the Administrative Court of Zug clarifies the conditions under which a dismissal in a public sector employment relationship can be lawfully pronounced, in particular in the event of a breach of trust.

Special features of the employment relationship under public law

In contrast to private labour law, which generally provides for extensive freedom of dismissal, public employers may only terminate the employment relationship for objective reasons. Such reasons include, for example, operational reorganisation, poor performance or – as in the present case – a lasting breach of trust. The relevant personnel laws of the cantons and municipalities require that the termination appears to be an objectively justifiable measure and that the general principles of state action, in particular the principle of proportionality, are observed.

Facts of the case: Trade union commitment and conflict of loyalty

In this case, a teacher at the Menzingen cantonal school reactivated the internal teachers’ union after a change in school management and campaigned on behalf of colleagues who had lost their jobs as a result of personnel decisions. Despite repeated requests from the school management to accept personnel decisions and respect competences, the teacher turned to the superior authority as a trade unionist. The school management saw this as a sustained breach of the relationship of trust and terminated the employment relationship.

Legal assessment by the administrative court

The Administrative Court of Zug examined whether there were objective grounds for termination and whether the dismissal was proportionate. It came to the conclusion that even a serious loss of trust – even without disciplinary misconduct – can justify a dismissal if cooperation is objectively no longer possible. The court emphasised that in such exceptional cases, milder measures such as a transfer or warning are not mandatory if they cannot restore the damaged relationship of trust. The dismissal was classified as not abusive; there was no entitlement to severance pay as there were no corresponding applications.

Procedural law requirements

Public employers are obliged to respect the right to be heard and to conduct the proceedings correctly. In particular in the case of performance or behavioural problems, a written warning and a probationary period are generally required before dismissal. The principle of proportionality requires that the mildest appropriate measure is always chosen. This can only be deviated from in the event of particularly serious disruptions – such as an irreparable loss of trust.

Practical conclusion

The decision of the Administrative Court of Zug shows that dismissal in the public sector can be permissible even without disciplinary offences, provided that the relationship of trust has been permanently and objectively disturbed. Nevertheless, each case remains a case-by-case examination: as a rule, warnings, the right to be heard and the examination of less severe measures are mandatory. Public employers should therefore document dismissals carefully and strictly adhere to the procedural requirements in order to avoid legal disputes.

Frequently asked Questions on public sector employment Law

An employment relationship under public law exists if the employment relationship is expressly regulated by cantonal personnel law, such as the Personalgesetz (PG) of the Canton of Zug. This applies in particular to teachers, administrative staff and employees of public authorities.

Depending on the applicable personnel law, notice of termination must be given in the form of a ruling, and the person concerned must be given the right to be heard. The dismissal must be justified in writing and there is a 30-day deadline for lodging an appeal. The procedure must be transparent and comprehensible.

Yes, a profound breach of trust can justify dismissal – even without disciplinary misconduct – if no milder measure (e.g. transfer, warning) is reasonable or likely to succeed. This was expressly confirmed by the Administrative Court of Zug in its ruling on the dismissal of a teacher.

In addition to the loss of trust, the following reasons may justify ordinary dismissal (see also BGer 8C_995/2012):

  • Lack of willingness to co-operate
  • Sustained breakdown of the relationship of trust
  • Quantitatively or qualitatively inadequate work performance
  • Personal difficulties with superiors or subordinates that affect the working atmosphere
  • Repeated criticism of social skills, confirmed by various stakeholders (e.g. pupils, parents, colleagues)
  • Work performance that does not improve despite support
  • Minimalist attitude in the fulfilment of the work assignment

No. An entitlement to severance pay only exists in the event of abusive dismissal. If there is an objective reason and the procedure was followed correctly, there is no such claim.

Debtors should not be able to discharge their financial obligations through abusive bankruptcy. At its meeting on October 25, 2023, the Federal Council enacted the necessary amendments to the law and ordinances, in particular the Federal Act on Debt Enforcement and Bankruptcy, with effect from January 1, 2025.

As a result, the hurdles to freeing oneself from debts to the detriment of creditors have become higher. If the debtor is registered in the Commercial Registry, claims under public law will no longer be pursued for seizure but for bankruptcy from January 1, 2025. These claims include, for example, tax arrears, fines or outstanding state pension contributions. Companies are therefore exposed to an increased risk of bankruptcy. Art. 43 no. 1 and 1bis SchKG, which excluded these claims from bankruptcy proceedings, will be deleted from the law.

This change has a major impact on companies and their creditors. This is because, unlike the previous procedure with loss certificates (‘Pfändungsverlustscheinen’), bankruptcy proceedings can put an end to a company’s activities. Only companies that are generally subject to bankruptcy are affected. Who is subject to bankruptcy is determined by Art. 39 para. 1 SchKG. Parliament justified the change by stating that debtors should no longer be able to misuse bankruptcy proceedings to avoid their financial obligations, such as salary payments or debts, and thus harm other people.

Private creditors benefit because the creditor who files for bankruptcy bears the costs. As the public sector is the most common creditor, private individuals can file their claim free of charge after the state has initiated bankruptcy proceedings. However, the deadline of 15 months for filing a bankruptcy petition must be observed. At the same time, this makes it more difficult for the authorities to enforce their claims, as they now have to go through the more complex bankruptcy proceedings.

The Federal Act on Combating Abusive Bankruptcy not only resulted in amendments to several laws, namely the Swiss Code of Obligations, the Debt Enforcement and Bankruptcy Act, the Swiss Criminal Code and the Federal Act on Direct Federal Taxation. As a result, the Commercial Register Ordinance and the Criminal Records Ordinance were also revised in order to provide the necessary implementing provisions for the implementation of the law.

From now on, bans on activities entered in the criminal register will be reported to the Federal Supervisory Authority for the Commercial Register, which will check whether a ban on activities is incompatible with entries in the commercial register. In addition, measures can be taken that go as far as deleting the person concerned from the commercial register. Furthermore, the cantonal tax authorities are obliged to notify the commercial register offices if a company has not submitted the annual financial statement required by law. These provisions strengthen cooperation between the authorities and prevent such companies from operating for long periods without keeping accounts and thus acting to the detriment of their creditors.

Presently there is no dedicated Artificial Intelligence (AI) legislation in Switzerland. Nevertheless, given the ever increasing adoption and use of AI tools in various sectors – in particular in finance, the risks associated with such systems would inevitably require thorough scrutiny.

To this end, the Swiss Financial Markets Authority (FINMA) has recently[i] published a set of findings and observations which take a risk-based approach defined from operational, data-related, IT and cyber alongside legal and reputational perspectives. The supervised entities would therefore need to identify, assess, monitor, manage and control the risks associated with their AI applications, either as an in-house development or outsourced, and to make sure these are aligned and reflected in their respective governance models.

Above all, FINMA highlights operational risks such as lack of robustness, correctness, bias and explainability, the risks associated with third party service providers as well as challenges in the allocation of responsibilities and accountability as the most compelling issues.

Once identified, the ‘materiality’ of the risks in question would need to be determined. In other words, to define whether a given AI application may carry a higher threshold in cases where it “…is used to comply with supervisory law or to perform critical functions, or when customers or employees are strongly affected by its results”.

From the perspective of date-related risks, it is apparent that incorrect, inconsistent, incomplete, unrepresentative or outdated data would undermine the credibility and effectiveness of an AI application. Therefore, certain measures would need to be put in place to ensure input data integrity and that the availability of and access to data is secured. On the other hand, FINMA refers to regular checks in order to detect data drifts, and to validation methods in order to guarantee ongoing quality of output data.

Lastly, it is noted that explainability of results would be critical for an effective assessment of an AI application, whereby the drivers of a given application and its behaviour under varying circumstances and conditions would need to be comprehensible even to non-experts such as clients, investors and supervisory authorities etc. For those applications carrying higher ‘materiality’, the results of an independent review forming an informed and unbiased opinion as to the reliability of the application in question would also need to be taken into account in the development phase of that application.

[i] See here https://www.finma.ch/en/news/2024/12/20241218-mm-finma-am-08-24/.

The new FINMA circular 2025/2 on rules of conduct under the Financial Services Act (FinSA) and Financial Services Ordinance (FinSO) which is set to enter into force on 1 January 2025[i] aims to put together a series of uniform standards for the provision of information and support of clients in the financial services sector.

A transitional period until 30 June 2025 is introduced for the implementation of certain requirements.

The circular will essentially be applicable to banks and security firms, managers of collective assets, companies with provision of fund management as well as portfolio management services. Therefore, those financial service providers which are not subject to FINMA supervision would in principle fall outside of the scope of the circular.

In a nutshell, a number of points as follows.

[i] See here https://www.finma.ch/en/news/2024/11/20241121-mm-rs-verhaltenspflichten-fidleg/.