The right of pre-emption in Switzerland
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In the context of a property transaction in Switzerland, even when everything appears ready to close quickly – offer accepted, financing approved – an unexpected legal hurdle can arise: the exercise of the right of pre-emption.
This legal mechanism allows certain private or public parties to replace the initial buyer, under specific conditions, and acquire the property at the agreed price. While it is rarely exercised, this right remains a reality that should not be overlooked, especially in certain regions or for particular types of property.
Who benefits from this right? What procedures must be followed? And how can you anticipate its enforcement? To secure your real estate project, it is essential to understand the scope and implications of this legal framework from the very first stages of the sale. This guide will help you navigate it with confidence.
Right of pre-emption in Switzerland: definition
The right of pre-emption is a legal mechanism that grants certain individuals the ability to acquire a property in priority, before it is sold to another buyer. In Switzerland, this right is governed by Articles 681 to 682a of the Swiss Civil Code, which define the conditions of exercise, deadlines, and entitled parties.
In practice, when a property is put up for sale, the holders of a right of pre-emption have a legal period of three months to exercise their right and acquire the property under the exact same conditions as the accepted offer. They receive no preferential treatment: they must take over the agreement in its entirety.
Who can exercise a right of pre-emption?
This privilege may be granted to different parties, depending on the nature of the property and local rules:
- Co-owners, when another unit in the building is being sold.
- Holders of a building right (surface right) tied to the land or building in question.
- Public authorities (municipalities or cantons), especially in areas with urban planning interests.
- Heirs or descendants, particularly in the transfer of agricultural land.
- Tenants, if the lease agreement includes such an option in case of sale.
Although strictly regulated, this right can influence the course of a property sale. It is therefore essential to check its existence and implications as early as the property’s marketing stage.
The different forms of pre-emption rights
The right of pre-emption is not a uniform concept. In Switzerland, it takes several forms depending on whether it is based on the law, a private agreement, or public planning objectives. Here are the main types recognised:
1. Statutory pre-emption right: a priority granted by law
This type of pre-emption applies automatically in cases provided for by the Swiss Civil Code, without the need for a separate contract. It particularly concerns co-owners of a building or holders of a building right (surface right). This right is strictly personal and cannot be transferred by inheritance.
2. Contractual pre-emption right: a clause agreed between parties
This form results from a private agreement between the seller and the beneficiary. It may take two main forms:
- Limited, when the price and conditions are fixed in advance, which strictly frames the future transaction.
- Unlimited, when the beneficiary can exercise the right under the same terms as those offered by a third-party buyer.
This type of clause is frequently used in early sales between relatives or business partners.
3. Public or urban pre-emption right: a tool for the public interest
Established by certain authorities, such as in the canton of Vaud, this right allows a municipality to acquire land in priority for projects of public utility, such as social housing developments. It only applies within specific designated areas and under certain conditions of land use and surface area.
What impact does the pre-emption right have on sellers and buyers?
The existence of a pre-emption right on a property significantly alters the standard sales process. It requires strict procedures and can have important consequences for both parties involved.
Impact on the seller
A property owner wishing to sell a property subject to a pre-emption right must formally notify the beneficiary (or beneficiaries), usually by registered letter. This notice must include:
- The clear intention to sell the property.
- The agreed price with the initial buyer.
- The full conditions of the transaction.
- A copy of the signed sales contract.
From the moment the notice is sent, the conditions can no longer be altered. The beneficiary then has three months to decide whether to exercise the right. During this period, the seller cannot finalise the sale with a third party, unless the beneficiary explicitly waives the right or does not reply within the deadline.
The property transfer can only be registered in the land registry if:
- the pre-emption right is not exercised within the legal period,
- the beneficiary formally waives it in writing,
- or the exercise of the right is deemed inadmissible.
Impact on the buyer
Even when an agreement has been reached with the seller, the initial buyer may lose the transaction if a third party exercises their pre-emption right. To minimise this uncertainty, buyers are advised to:
- Check in advance whether a pre-emption right exists on the property.
- Contact the potential beneficiaries to clarify their position.
- Include a suspensive clause in the preliminary contract, making the sale conditional on the absence of pre-emption.
- Adjust financing and signing deadlines accordingly.
In the Swiss property market, pre-emption rights are relatively common. Ignoring them may cause delays or complications, while identifying and managing them early on ensures a more secure and predictable transaction for both sellers and buyers.
FAQ on the pre-emption right in Switzerland
What is the pre-emption right in Switzerland?
The pre-emption right is a legal mechanism that allows a person or a public authority to purchase a property in priority, before it is sold to another buyer. It is regulated by Articles 681 to 682a of the Swiss Civil Code and is usually exercised within three months after the sale has been notified.
Who can exercise a pre-emption right?
Depending on the type of property and cantonal legislation, this right may be granted to various parties. It may benefit co-owners when another unit is being sold, holders of a building right (droit de superficie), public authorities such as cantons or communes for urban development projects, heirs or descendants in the case of agricultural land, or even tenants if a clause in the lease contract provides for it.
What are the different types of pre-emption rights?
There are three main forms. The legal pre-emption right applies automatically when provided for by law, for instance in the case of co-ownership. The contractual pre-emption right arises from an agreement between seller and beneficiary, and may be limited (with pre-defined conditions) or unlimited (matching the offer made by a third party). Finally, the public or urban pre-emption right allows some communes or cantons to acquire land in priority for projects of public interest, such as housing or infrastructure.
How is the pre-emption right exercised?
The seller must notify the beneficiary formally, usually by registered letter. This notification must include the agreed sale price, the full terms of the transaction and a copy of the signed contract. From that moment, the beneficiary has three months to either accept or waive the right.
What are the consequences for the seller?
Once the notification is sent, the seller must suspend the transaction until the legal period expires. The property transfer can only be registered in the land registry if the right has not been exercised, has been expressly waived in writing, or has been declared invalid.
What are the consequences for the initial buyer?
Even if a preliminary contract has been signed, the initial buyer risks losing the transaction if the pre-emption right is exercised by a third party. To reduce this risk, it is strongly recommended to check in advance whether such a right exists, to approach potential beneficiaries to clarify their intentions, and to include a suspensive clause in the sales agreement.
Can the pre-emption right be bypassed?
No. This right is enforceable against any purchaser. The only way to avoid its activation is to obtain a written waiver from the beneficiary before the final deed of sale is signed.
