Retrocessions: open questions and current doctrinal debates

Focus and framing#

This post addresses the questions that, according to Abegglen, remain unresolved or controversial despite the Federal Supreme Court’s clarifications up to 2024. The emphasis is on doctrinal fundamentals and their practical relevance.

The unresolved “Gretchenfrage”: execution-only#

At the centre remains the question whether a surrender duty for retrocessions exists in pure execution-only relationships. The Federal Supreme Court has deliberately left this issue open, as the cases decided to date involved valid waivers.

Doctrinally, two opposing views persist:

• one argues that, in the absence of discretion, execution-only relationships typically lack relevant conflict-of-interest potential;

• the other points to scenarios where factual incentives or hidden decision leeway may arise even in execution-only settings (e.g. routing incentives).

Cantonal divergence#

Abegglen highlights that cantonal courts have taken divergent approaches to execution-only cases. These divergences concern, in particular:

• whether the technical execution of transactions alone creates sufficient proximity to “management of the business”;

• how factual incentives should be weighed against formal absence of discretion.

For practitioners, this translates into continued legal uncertainty and a need for cautious structuring.

Conflict-prevention vs “non-enrichment”#

Another doctrinal debate concerns the normative basis of the surrender duty. Abegglen rejects a general “non-enrichment” theory and instead anchors Art. 400 CO in the prevention of conflicts of interest arising from loyalty obligations.

Competing views that focus primarily on impermissible additional remuneration struggle, in Abegglen’s analysis, to explain the central role of the inner-connection test and the differentiated treatment across relationship types.

Boundary to genuine third-party services#

The distinction between surrender-relevant retrocessions and permissible remuneration for genuine third-party services remains contentious. Abegglen stresses cumulative criteria:

• the existence of an independent service rendered to the third party;

• the absence of a corresponding obligation towards the client;

• remuneration at arm’s length.

Borderline cases arise where services are formally structured as third-party services but economically tied to the client relationship.

Civil law and supervisory law#

Abegglen situates the debate within the broader interaction between civil and supervisory law. He argues for taking supervisory-law value judgments into account under the principle of unity of the legal order, while cautioning against a mechanical transposition of supervisory rules into private law.

Outlook#

According to Abegglen, a Federal Supreme Court ruling on execution-only retrocessions appears inevitable in the medium term. Until then, the law remains fragmented, and doctrinal debates continue to have direct practical implications.

Takeaway#

Despite significant progress, the law of retrocessions remains open-ended. Art. 400 CO is best understood not as a rigid enrichment rule, but as a flexible mechanism for preventing conflicts of interest.

References#

• Abegglen pp. 2, 6–8, 11–12

Regulatory notice#

This publication is provided for information purposes only and does not constitute legal, tax or investment advice. It is not an offer, solicitation or recommendation. It is directed solely at qualified investors in Switzerland and is not intended for U.S. persons.