Switzerland is one of the world's most sought-after real estate markets for Asian private wealth. But before any transaction can proceed, one piece of legislation demands attention: the Federal Act on the Acquisition of Real Estate by Persons Abroad, universally known as Lex Koller. Understanding it upfront saves time, avoids missteps, and opens up the right structuring pathways.
What is Lex Koller?
Lex Koller (formally the Bundesgesetz über den Erwerb von Grundstücken durch Personen im Ausland, or BewG) was introduced in 1983 to limit foreign ownership of Swiss residential real estate. Its core principle: non-Swiss residents generally require a government permit to purchase residential property in Switzerland. The law applies to individuals and legal entities where the ultimate beneficial owner is a non-Swiss resident.
What Lex Koller restricts
The law restricts the purchase of residential real estate by persons domiciled abroad. This includes apartments, houses, and chalets intended for private use. The restriction applies regardless of nationality, a Singapore, Hong Kong, or Malaysian passport holder living outside Switzerland faces the same rules as any other foreign non-resident buyer.
What Lex Koller does NOT restrict
- Commercial real estate, office buildings, retail, warehouses, and mixed-use properties with commercial ground floors, is freely purchasable by foreign buyers with no permit required
- Residential property purchased by foreign nationals who are domiciled in Switzerland (i.e., hold a Swiss residence permit) is also exempt
- Certain hotel and resort properties may qualify as commercial, depending on their legal classification
- Corporate acquisitions that are primarily commercial in nature may not trigger Lex Koller even if residential components are present
Cantonal quotas: the residential pathway
For holiday or vacation properties in designated Swiss resort cantons. Valais, Graubünden, Bern Oberland, and others, foreign buyers may acquire residential property within cantonal annual quotas. These permits are limited in number, issued by cantonal authorities, and subject to conditions (the property must be used as a holiday residence and may not be let for extended periods). Properties in Zurich, Geneva, Zug, and Basel as primary urban centres do not fall under this quota system and are generally not accessible to non-resident foreign buyers for residential use.
Practical implications for Asian buyers
For most Singapore, Hong Kong, Malaysian, and Thai investors approaching the Swiss market as non-residents, the most straightforward path is commercial real estate, which carries no Lex Koller restriction. For those seeking residential property, the options are: establishing Swiss residency (which opens the residential market fully), acquiring within cantonal holiday property quotas in designated resort areas, or purchasing via a structure where the commercial use classification is defensible. All of these pathways require specialist Swiss legal counsel.
Global Key Partners' approach
GKP does not provide legal advice. What Global Key Partners does is ensure that Asian investors approaching the Swiss market understand the Lex Koller framework before beginning a property search, and that they are connected with the right specialist legal counsel from the outset. We work alongside experienced Swiss property lawyers on every international buyer mandate, structuring comes first, search comes second.
Frequently asked questions
Yes. Lex Koller applies to all non-Swiss residents purchasing residential real estate in Switzerland, regardless of nationality. Singapore investors domiciled outside Switzerland require a permit to purchase Swiss residential property. Commercial real estate is not subject to Lex Koller and may be purchased freely.
In designated resort cantons (Valais, Graubünden, parts of Bern Oberland), foreign non-resident buyers may purchase holiday chalets within annual cantonal quotas. These quotas are limited and subject to conditions. For most urban residential property in Zurich, Geneva, or Zug, non-resident foreign buyers cannot purchase under current Lex Koller rules without first establishing Swiss residency.
Establishing Swiss residency, which is achievable for qualifying high-net-worth individuals, removes the Lex Koller restriction entirely. Alternatively, focusing on commercial real estate (which carries no restriction) or qualifying Alpine resort properties (within cantonal quotas) are the main pathways for non-resident buyers. GKP connects clients with specialist legal counsel to assess the most appropriate route.
Yes. Lex Koller applies to legal entities where the controlling beneficial owner is a non-Swiss resident. Acquiring through a Swiss company does not automatically circumvent the restriction if the ultimate beneficial owner is a foreign non-resident. Specialist legal advice on structuring is essential.