Switzerland juggles fighting crime against threat to tech-privacy industry

Switzerland has quietly built an outsized position in a global industry that provides internet encryption tools allowing customers to keep their business hidden from the prying eyes of potential attackers and law enforcement alike.EPA/FAZRY ISMAIL Keystone

Swiss companies have turned the nation into a global hub for internet services that ensure privacy and security. Yet exploding threats from cybercrime are forcing Switzerland to consider ways to balance the economic benefits of this burgeoning tech industry with the need to monitor for potential attacks from criminals, hostile states and terrorists.

Switzerland’s talent for keeping secrets isn’t limited to rich people’s bank accounts.

The country of nine million has quietly built an outsized position in a global industry that provides internet encryption tools allowing customers to keep their business hidden from the prying eyes of potential attackers and law enforcement alike.

The nation’s reputation for privacy, enshrined in the constitution, has been leveraged by companies as a selling point. Proton AG, a services company headquartered in Geneva, announces its offer is “backed by Swiss privacy laws”. It offers include encrypted email to cloud storage and artificial intelligence.  

Yet over a decade after its founding, the firm is just one of the many balking at proposed changes to the law that would, they say, damage trust and economic benefits from the industry. Proton says it has halted plans to invest in more infrastructure in the country.

In 2025, Switzerland proposed revising its Ordinance on the Surveillance of Postal and Telecommunications Traffic to clarify internet service providers’ obligations in criminal investigations, with larger platforms facing data-retention and cooperation requirements similar to those of traditional telecom operators.

“It’s not just about whether Switzerland will weaken its own privacy protection barriers,” Proton’s chief operating officer, Raphael Auphan, told Swissinfo. “But also about whether Switzerland will lose the digital companies that have grown and thrived here, bringing Swiss privacy values to the world.”

While Auphan has a clear business interest in the debate, Switzerland has to balance voices like his, and a tradition of protecting privacy, against rising tech capabilities and dangers from criminals or hostile powers primed to utilize them. It’s a dilemma felt across liberal democracies, European Union, United States and United Kingdom all adapting to new threats.

The number of cybercrimes reported by Swiss police almost tripled in five years to around 65,000 in 2025, data from the National Cyber Security CentreExternal link show, with the government reacting to such explosive growth by reviewing regulation of digital communications.

Public interest vs private commerce

That could mean some providers having to gather more data on their customers, and make it easier for authorities to pursue criminal investigations. At the same time, the country can’t ignore concerns of businesses like Proton, which has grown to become Europe’s largest privacy-tech firm with over 100 million users worldwideExternal link.

Opposition and threats to relocate operations by businesses can be seen as driven by both public interest concerns and commercial impetus, Christopher KunerExternal link, affiliate professor of data protection and privacy law at the University of Copenhagen, told Swissinfo. All the while, growth in digital data adds to challenges for the authorities.

“There are many driving factors behind this […]  including concerns about aggression by Russian and other national actors, the growing threat to cyber security and the regrettable notion that privacy is to some extent dispensable,” said Kuner, who’s been involved in development and research into global data protection since the 1990s.

Swiss tech punches harder

While businesses in privacyExternal link tech are spread widely from the US and UK to Germany, and even China, several advantages have helped tiny Switzerland punch above its weight.

At the heart of these sits Article 13 of the Federal Constitution, enshrining the right to privacy and the protection of personal data. This provides individuals, businesses and others with a strong legal basis to challenge state surveillance. In comparison, US privacy protection isn’t specified explicitly in its constitution but derived from interpretations of often peripheral areas across different amendments.

Beyond its constitution, Switzerland’s long-standing history of secrecy reinforces its allure for those seeking anonymity. Although Swiss banking transparency has been increased to meet international rules following accusations of hiding dirty money, its reputation persists, helping companies to build trust with users worldwide.

In addition, a centuries-old policy of neutrality, and avoidance of intelligence-sharing alliances such as the US-led Five Eyes, Nine Eyes, and Fourteen Eyes groups of nations, have added to Switzerland’s image as an independent jurisdiction safe from spying.

Indeed, Proton’s Auphan traces the growth of the Swiss privacy hub to revelations by US National Security Agency (NSA) contractor Edward Snowden of mass monitoring by American spies in 2013. That led to a surge in demand for encrypted email, VPNs that obfuscate internet users’ location and identity, and other secure communications and data tools.

Local firms such as Proton, Threema and Nym have since capitalised on concerns over digital privacy, expanding rapidly and handing Switzerland a leg up in the industry.

Many specifically cite their Swiss jurisdiction in marketing, such as encrypted cloud storage and collaboration operator Tresorit, which states that it’s immune to a US law of 2018 that allows enforcement agents, via a warrant, to compel American-based firms to hand over data stored on servers even if the equipment is located overseas. Computer services firm InfomaniakExternal link sells itself as a “Swiss sovereign cloud” provider.

“For privacy-focused companies, the real difference often lies in Switzerland’s long-held values; legal stability, efficient and predictable procedures, respect for legal limitations, and a culture of caution when handling sensitive information,” said Sylvain Métille, an associate professor at the University of Lausanne specialising in data protection, digital law, cybersecurity and government surveillance, adding that this is more significant than any minor distinctions in its laws.

Privacy under pressure

Efforts by regulators to keep up with advances in technology began soon after the local privacy industry took off a decade ago. Against a backdrop of greater surveillance in nations like GermanyExternal link and FranceExternal link, Switzerland adopted its revised Federal Act on the Surveillance of Mail and Telecommunication Traffic and Intelligence Service Act in 2016. These expanded data gathering for evidence in criminal and national security cases.

Yet ambiguity over whether the rules applied as much to tech companies as traditional telecoms operators led to years of disputes including that between authorities and Threema. Proton was exempt because it wasn’t considered a major telecoms provider and 95% of its Proton Mail users were outside Switzerland, according to Auphan.

Laws born in an older era appear “outdated”External link given how tech has developed, wrote Monika Simmler, professor of criminal and surveillance law at the University of St Gallen.

Meanwhile, demands from police and other agencies are rising fast. Data requests at the Postal and Telecommunications Surveillance Service jumped over 30% in 2025.External link

The Swiss government proposed amendmentsExternal link to the Ordinance on the Surveillance of Postal and Telecommunications Traffic last year to clarify internet service providers’ obligations. Under the draft, they face increasingly stringent data retention and cooperation requirements, depending on their size. Those with more than a million users or generating more than CHF100 million in Swiss revenue for two straight years would face rules similar to those of traditional telecommunications operators.

Here comes the backlash

The draft triggered a backlash from technology firms and digital rights groups. Debate in the national parliament highlighted tensions between preserving Switzerland’s privacy-tech ecosystem and renewing investigative powers to secure public safety.

Swiss senator Johanna Gapany warned thatExternal link “if we want to maintain our autonomy and independence in digital development and artificial intelligence, then we clearly need these privacy technology companies to remain in Switzerland”.

On the other side, Swiss Justice Minister Beat Jans argued thatExternal link law enforcement must retain the ability to legally obtain and trace communications data when faced with investigations into terrorism and serious organized crime, stressing that “this would not be a large-scale state surveillance operation”.

There’s legitimate public interest in gathering some kinds of data, particularly in major criminal and national security cases, but improvements in technology shouldn’t be an excuse for increased surveillance, according to professor Métille. Governments must explain the purpose and legal basis of surveillance measures and be open to scrutiny by independent oversight bodies with the power to prevent abuses.

Competition from other jurisdictions

Proton is diversifying its base and infrastructure across several European countries, rather than rely only on Switzerland, to mitigate what it sees as a risk to its business.

Some countries are working to turn themselves into privacy-friendly jurisdictions.

Iceland has implemented the EU’s General Data Protection Regulation (GDPR) despite not being a member of the bloc, and has strengthened its data sovereignty and invested in cybersecurity infrastructure. In May, PrivadoVPN movedExternal link its legal headquarters there from Switzerland because of the island nation’s weaker requirements for VPNs to log their customers.

Meanwhile, Estonia has developed a digital identity system and secure data-exchange platform. Building on this, security and authentication businesses such as Guardtime, Cybernetica and Veriff have sprung up, establishing the country as a serious tech hub.

Such competition only adds to pressure on Swiss authorities to strike the right balance.

“The challenge is to keep Switzerland a leading, trustworthy jurisdiction for digital services and innovation,’’ said Métille, “without turning it into a safe haven for clearly illegal activities.”

Edited by Tony Barrett/vm/sb