The Ordinance on the Use of the Name "Swiss" for Watches (the "Swiss Made" Ordinance for Watches) adopted in 1971 regulates the use of the indication of source "Swiss" for watches. The Federal Council approved a partial revision of this ordinance on 17 June 2016 and will put it into force on 1 January 2017. This strengthens the "Swiss Made" designation for watches and watch movements in line with the new 'Swissness' legislation.
The designations "Swiss" and "Swiss Made" on a watch represent the Swiss art of watchmaking. Consumers are generally prepared to pay up to 20 per cent more for a Swiss watch, and even up to 50 per cent more for certain mechanical ones. This has been shown by various studies, in particular those by the ETH Zurich and the University of St. Gallen. The revised "Swiss Made" Ordinance seeks to reinforce the association to Switzerland for watches being promoted as "Swiss Made" in order to counteract the risk of free riders. By doing so, the good reputation of the "Made in Switzerland" brand for watches will be strengthened together with Switzerland as a location for production.
In future, at least 60 per cent of the costs of manufacturing a complete watch (as an end product) must be generated in Switzerland – unlike previously, whereby this rule applied only to the watch movement itself. The movement remains important, however, as at least half of its value must consist of components made in Switzerland, and at least 60 per cent of the costs to manufacture it must be generated in Switzerland. In addition, the technical development of a "Swiss Made" watch and a "Swiss Made" movement must, in future, also take place in Switzerland. The definition of 'watch' in the "Swiss Made" Ordinance has also been extended to include smart watches in light of recent technological developments.
Watch casings and glass can be excluded from the calculation of manufacturing costs until 31 December 2018, provided that the watch casings and glass in question were already kept in stock at the time the "Swiss Made" Ordinance comes into force. This ensures that producers have sufficient time to reduce all stock legitimately accumulated under the law in force and that the duration of the transitional measures is clear to suppliers.
The revised "Swiss Made" Ordinance for Watches will enter into force on 1 January 2017. This is also the date on which the new "Swissness" rules will enter into force.
The Federal Council also approved the report on the results of the consultation procedure on the Draft "Swiss Made" Ordinance for Watches on 17 June. For further information, see also Consultation 2015".
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