Lex Koller Explained

Lex Koller is the informal name for the Bundesgesetz über den Erwerb von Grundstücken durch Personen im Ausland (BewG) — the Federal Act on the Acquisition of Real Estate by Persons Abroad. It was enacted in 1983 and has been amended several times since.

The law restricts the acquisition of residential real estate in Switzerland by foreign nationals who are not resident in Switzerland, and by certain legal entities. Its stated purpose is to prevent excessive foreign ownership of Swiss residential property and to protect the Swiss housing market from speculative foreign investment.

Lex Koller does not prohibit all foreign property acquisition. It establishes a system of exemptions, authorisations and annual quotas. Whether a foreign national may acquire Swiss property — and under what conditions — depends on a structured analysis of multiple factors.

Lex Koller applies to the acquisition of residential real estate in Switzerland by persons abroad. The term "persons abroad" (Personen im Ausland) covers:

• —Foreign nationals who are not resident in Switzerland
• —Non-EU/EFTA foreign nationals resident in Switzerland with certain permit types (notably L permits)
• —Legal entities (companies) that are controlled by persons abroad or have their registered seat abroad
• —Swiss legal entities in which persons abroad hold a controlling interest

Lex Koller applies to residential property. Commercial real estate is generally outside the scope of the law, though the distinction between residential and commercial use can be complex in mixed-use properties.

The following categories of persons are exempt from Lex Koller and may acquire residential property in Switzerland without restriction:

Foreign nationals who are not resident in Switzerland — and non-EU/EFTA nationals with certain permit types — require cantonal authorisation to acquire residential property in Switzerland.

Authorisation is only available in specific circumstances:

• —Acquisition of a holiday home in a designated tourist zone, subject to annual cantonal quotas
• —Acquisition of a property for use as a primary residence by a non-EU/EFTA national with a B permit
• —Certain specific circumstances defined in the law (e.g. inheritance, specific commercial contexts)

Authorisation is not available for the acquisition of residential investment properties, secondary residences outside tourist zones, or properties in cantons without designated tourist zones.

Authorisation under Lex Koller is granted by the competent cantonal authority (typically the cantonal land registry authority or a designated cantonal office). The process involves:

The Federal Council sets an annual national quota for Lex Koller authorisations for holiday home acquisitions by non-resident foreign nationals. This quota is distributed among the cantons that have designated tourist zones.

Each canton administers its own portion of the annual quota. When a canton's quota is exhausted, no further authorisations can be granted in that canton for the remainder of the calendar year. Quotas reset at the beginning of each year.

In practice, quotas in the most popular resort cantons (particularly Valais and Graubünden) can be exhausted relatively quickly. Buyers should be aware that quota availability is not guaranteed and should plan accordingly.

Lex Koller extends to legal entities. A Swiss company (AG, GmbH or other form) that is controlled by persons abroad — or in which persons abroad hold a significant interest — is treated as a "person abroad" for Lex Koller purposes.

This means that acquiring Swiss residential property through a Swiss company does not circumvent Lex Koller if the company is controlled by foreign nationals who would themselves be subject to the law. The law specifically addresses this structure to prevent circumvention.

For a detailed analysis of this topic, see the dedicated guide on buying Swiss property through a company.