The Lex Koller — formally the Federal Act on the Acquisition of Real Estate by Persons Abroad (BewG) — has shaped Swiss residential property markets since its introduction in 1983. Its primary purpose is to prevent excessive foreign ownership of Swiss residential real estate, and it remains one of the most consequential pieces of legislation for any international buyer considering a Swiss property acquisition.

The legislation applies specifically to residential property. Commercial real estate, industrial land and properties used exclusively for business purposes are generally outside its scope, which is why many international investors approach Switzerland through commercial or mixed-use structures. For private residential acquisitions, however, the rules are precise and the consequences of non-compliance are serious.

Foreign nationals who are not EU or EFTA citizens and do not hold a Swiss C permit (permanent residence) require a cantonal authorisation to purchase residential property in Switzerland. This authorisation is subject to annual quotas allocated to each canton by the federal government. The total national quota is approximately 1,500 authorisations per year — a figure that has remained broadly stable for decades and that creates genuine scarcity in the most sought-after locations.

EU and EFTA nationals holding a B permit (residence permit) may purchase one primary residence in Switzerland without requiring a Lex Koller authorisation, provided the property is their main domicile. This is a significant distinction: it means that an EU national who is resident in Switzerland and holds a valid B permit can acquire property on broadly the same terms as a Swiss citizen for their primary home.

The most important exemption for international buyers concerns holiday properties in designated tourist zones. Certain Swiss cantons — including Valais, Graubünden, Bern (Bernese Oberland) and parts of Vaud — contain zones where foreign buyers may acquire holiday residences subject to cantonal quota. These quotas are limited, and in the most prestigious locations such as Verbier, Gstaad, Zermatt and St. Moritz, they are frequently exhausted. Timing and local knowledge are therefore critical.

Properties acquired under a Lex Koller authorisation carry specific restrictions. The buyer must use the property personally and may not rent it out commercially on a long-term basis, though short-term holiday rentals are generally permitted. The property may not be resold to another foreign buyer without a new authorisation, and certain structural changes may require cantonal approval. These restrictions are registered in the land register and run with the property.

For buyers considering Geneva, Zurich, Lausanne or other primary urban centres, the position is more restrictive. These cities are not designated tourist zones, and Lex Koller authorisations for residential property in urban areas are extremely rare. In practice, foreign buyers without Swiss residence who wish to acquire in Geneva or Zurich typically do so through commercial structures, or they establish Swiss residence first.

The practical implications for a private buyer are significant. Engaging a Swiss notary and a specialist property advisor at the earliest stage is essential. The authorisation process takes time — typically several weeks to several months depending on the canton — and must be factored into any acquisition timeline. Attempting to structure a purchase without proper legal advice in this area is a risk no serious buyer should take.