The European duty of vigilance and its effects on Geneva

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The European directive on corporate sustainability due diligence, adopted in 2024, imposes on large companies of the Union, and on third-country companies generating substantial turnover in the Union, due diligence duties regarding human rights and the environment across their chains of activities, backed by civil liability and sanctions. Its thresholds and timetable were raised and postponed by the simplification package of 2025.¹ Several Geneva traders exceed the thresholds through their European turnover and will be subject to the directive, whatever the fate of the Swiss initiative. Their banks and their European clients are already asking them for the corresponding information.

This de facto extraterritoriality, which Part K described for other fields, reduces the significance of the Swiss debate for the largest houses while preserving it for the medium-sized ones, which fall below the European thresholds. It has a strategic consequence: the Geneva financial centre has an interest in Swiss law converging with European law, so as to spare its companies two divergent regimes, which is what the Federal Council’s counter-proposal aims to achieve. It also has a consequence for reputation: a financial centre whose companies apply the European duty of vigilance without being compelled to do so by Swiss law can turn this into a selling point, as the previous section suggested.

Notes

Directive (EU) 2024/1760 on corporate sustainability due diligence; “Omnibus I” package of the European Commission of 26 February 2025 proposing the postponement of transposition to July 2027 and of application to July 2028, the limitation of due diligence to direct partners and the raising of the thresholds; Mayer Brown, “European Commission Presents ‘Omnibus’ Simplification Package”, mayerbrown.com, February 2025. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.

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Dr Alexander Ressos, TEP

Rechtsanwalt/Attorney-at-Law

I am a Swiss attorney-at-law and also admitted as a solicitor in Hong Kong and in England & Wales, with almost 25 years of experience.

Together with my multilingual team, including Chinese, Japanese, Korean, Russian, Ukrainian and French native speakers, I advise companies and their owners from around the world on the full range of banking, corporate, commercial and tax law matters in Switzerland, including international tax planning, fiduciary services, and legal family office services including immigration & relocation or real estate investments. My practice has a particular focus on clients from growth and frontier markets in Greater China, Central Asia and the Caucasus, the rest of Asia, the Middle East, Africa and Latin America, and I equally advise clients from Europe and North America. Through an affiliated Swiss trust company, we also take care of the incorporation and ongoing administration of their companies and other structures, including accounting, tax returns and corporate secretarial services, and I serve as a professional director where required. With the support of a network of first-class cooperation partners, I also implement solutions worldwide.

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The European duty of vigilance and its effects on Geneva

Notes

Setting up or expanding in Switzerland?