Swiss-made brand finally wins political backing

The red flag and white cross alone do not make a product Swiss-made Keystone

Parliament has given final approval to a law protecting of the quality brand Made in Switzerland for products, including watches, as well as for services and a wide range of foodstuffs, despite opposition by influential industry players.

The new law foresees that at least 60 per cent of the value of an industrial product – ranging from machines to pocket knives – must originate in Switzerland to benefit from the label Made in Switzerland. Opponents argued that 50 per cent would suffice to qualify for the marque.

The issue has divided the country’s watchmaking industry, since both rates are stricter than a long-standing directive governing the use of the special stamp for watches. Under current rules, pertaining to only the moving parts of the watch – not the entire thing –  a minimum  of 50 per cent of the value must be produced in Switzerland.

Lobbying for the new 60 per cent rate, the Watch Federation said the stricter regulations would preserve jobs in the industry which employs more than 50,000 people.

“Clear legal rules are needed to ensure that future generations can benefit from the added value created by the Swiss-made label,” a statement said.

The Watch Federation dismissed allegations that the stricter regulations would lead to more bureaucracy.

However, watchmakers in the lower-priced segment, which import all cases, dials, hands and straps, are concerned about tighter rules for the business. They fear the new rules will force them to cut jobs.

The fight over tighter rules led to tensions between the leading watchmakers and the Swiss Business Federation umbrella group.

Following years of discussion, the draft “Swiss-made” law passed with margins of 88 votes in the House of Representatives and 13 votes in the Senate on the last day of the three-week summer session.

Swiss-made advantage

In an effort to protect Swiss products and services from abuses, the government in 2006 published a report detailing the state of the Swiss-made brand.

Parliament began discussions on the draft law in 2009 and approved it four years later following numerous debates and amid disagreements within certain industries.

Studies found that the Swiss-made label or the Swiss cross contribute up to 20 per cent to consumer prices for not only typical products such as jewelry, watches, cheese and chocolate but also industrial products, ranging from machines to pocket knives.

Milk, meat bring debate

Another sticking point in the debate about the Swiss-made designation concerned animal products. Under the new law, meat and milk can only benefit from the label with the red flag and white cross if the animals are – or were – held in Switzerland.

Food of non-animal origin must in principle contain at least 80 per cent of Swiss raw material to claim the quality trademark. The law provides for a series of exceptions, however.

A proposal by the food industry to introduce separate rates based on the degree to which a food product is processed was rejected during the debates.

The country’s main farmers’ association has welcomed the new law. Initially it threatened to launch an initiative if parliament failed to approve a minimum rate of 80 per cent Swiss origin for non-animal food products.

Reaction and enforcement

The Association of Small and Medium-Sized Enterprises (SME) and the electrical and engineering industry unsuccessfully tried to bring down the draft law, saying a 60 per cent rate for industrial products was too high.

However, following the law’s passage, the SME association said it would try to ensure that the new rules would be applied “pragmatically and reasonably”, said Rudolf Horber, a leading member.

And, the Foundation of the Protection of Consumers welcomed the law as practical and credible.

“Consumers must be able to trust in labels. We have seen enough window-dressing in the past,” said foundation president Prisca Birrer-Heimo.