Transit trade: why the goods never touch Switzerland

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The commodities traded from Zug almost never pass through Switzerland. A cargo of copper concentrate bought from a mine in Chile and sold to a smelter in China is shipped directly from Chile to China. The trading company in Zug buys and sells it on paper, arranges the shipping and the financing and books the margin. This form of trade, known as merchanting or transit trade, is recorded in the Swiss balance of payments as a receipt from trade in goods: the net receipts of the Swiss traders from the purchase and sale of goods that do not cross the Swiss border.¹

The transit trade makes the commodity business almost invisible in the physical economy of the canton. No ships dock in Zug, no warehouses store the metals, no pipelines carry the oil. The business consists of offices, screens, telephones, contracts and bank accounts. Its presence is visible in the office buildings of Baar and Zug, in the international staff who work in them and in the tax revenue that the canton receives from their profits. This invisibility has contributed to the long public indifference to the commodity trade in Switzerland, which a communications study has described as a "blind spot" of the Swiss public.²

Notes

Swiss National Bank, "Zahlungsbilanz und Auslandvermögen der Schweiz 2016", snb.ch: the SNB compiles the balance of payments in accordance with the IMF Balance of Payments and International Investment Position Manual, 6th edition (BPM6); merchanting covers goods bought abroad and resold abroad without entering or leaving Switzerland, and its net receipts (sales minus purchases) are recorded in the current account as receipts from goods. See also Stephanie Krell and Pınar Yeşin (SNB), "Transithandel: Ein Gradmesser der Globalisierung", Die Volkswirtschaft, February 2023, dievolkswirtschaft.ch. ↩
Angelo Gisler, "Rohstoffhandel – Blinder Fleck der Schweizer Öffentlichkeit", commsLAB AG, 28 May 2024 (updated 2 June 2026), commslab.com: on the basis of the Swiss Economy Reputation Index (SERX), media attention to the commodity trade is low relative to its economic weight and concentrated on Glencore. ↩

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 October 2026.

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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.

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Transit trade: why the goods never touch Switzerland

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