Governmental Measures in Switzerland Against Mass Bankruptcies During the Covid-19 Pandemic

This article examines the impact of the Covid-19 pandemic on debt enforcement and insolvency law in Switzerland. Despite the absence of strict lockdown measures, many sectors of the Swiss economy suffered significant losses. The government responded by introducing generous public support schemes to keep businesses afloat. The article focuses on the modifications made to Swiss law during the pandemic to avoid mass bankruptcies and facilitate restructurings. The government first introduced a general stay of proceedings, preventing debt collection but not affecting the underlying obligation to pay, and later the Covid-19 Ordinance on Insolvency Law, which provided relief to companies, especially SMEs, to implement the necessary restructuring measures. Some unsuccessful initiatives, such as a special moratorium introduced for SMEs, are also discussed. Finally, the article considers the limited take-up of some of the insolvency measures and discusses the possible consequences of the obligation to repay Covid-19 loans in the future. Overall, it provides a comprehensive overview of the impact of the pandemic on debt enforcement and insolvency law in Switzerland and the measures taken to mitigate its effects.