Expert Insights

Expert Insights

UK divorces and Swiss pension fund assets: anticipate a complementary Swiss procedure when divorcing in the UK

As a rule, both in England and in Switzerland, pension fund assets are split upon divorce. And these can be - along with the family home - valuable assets.

The Swiss legal framework

Since 1 January 2017, Swiss pension funds no longer implement foreign divorce decisions deciding on the splitting of Swiss pension fund assets. Only Swiss judges are competent to decide on the division of pension assets held with a Swiss pension fund.

Foreign judgments relating to the division of a pension fund with a Swiss institution that came into force before 1 January 2017 can be recognised in Switzerland under the conditions of the previous law.

English orders are no longer executed insofar as they concern the division of Swiss pension assets.

Consequently, if one of the spouses (or both) has pension fund assets in Switzerland which are to be split, a complementary action shall be filed with the competent Swiss courts. Action is usually brought at the place where the pension fund institution has its seat.

How to proceed in practice

Due to the exclusive jurisdiction of the Swiss court, Swiss legal advice on the Swiss pension fund asset splitting is recommended. This is to ensure that the English Order is properly formulated in view of the future Swiss complementary procedure.

Once the final decree is rendered in the UK, the ex-spouses will have to mandate a Swiss counsel for him to file an “action en complément du jugement de divorce” with the competent Swiss court.

In Switzerland, this procedure is relatively fast. Depending on the competent court, the judge in charge of the case might require a hearing. Hearings are in person with the partner in attendance. That said, a person residing abroad can be excused from appearing in person at a hearing.

Transfer of Swiss pension fund assets

Once the Swiss judgment is rendered, the Swiss court will order the Swiss pension fund to transfer part of the pension fund assets on a special account solely intended for pension fund assets.

In Switzerland, pension fund assets can only be deposited with a pension fund or with a vested benefits account, in French “compte de libre passage”. When reaching the Swiss legal age of retirement (of 65 years), the amount can either be withdrawn in capital or a monthly income can be paid.

Our family team in Switzerland is well placed to assist. For further information, please contact Joanna Metaxas.

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