The acquisition of real estate in Italy by Swiss citizens and, conversely, the possibility for Italian citizens to invest in real estate in Switzerland: the principle of reciprocity and the limitations imposed by the Koller Law

The acquisition of real estate in Switzerland by an Italian citizen, or by foreign nationals in general, is not entirely unrestricted but is subject to specific limitations imposed by Swiss legislation, namely the so-called Koller Law.

Since 1961, Switzerland has enacted laws governing the acquisition of real estate by foreign individuals. These provisions, which have undergone several amendments over time, are issued at the federal level and are applicable throughout the country. However, they are implemented by the individual cantons, which regulate the authorizations required for foreign purchasers.

The Lex Koller establishes that foreign nationals are subject to this legal framework. The following categories fall within its scope:

1. Foreign nationals domiciled abroad.
2. Citizens of EU/EFTA countries residing in Switzerland without a B, C, or L residence permit.
3. Citizens of non-EU/EFTA countries residing in Switzerland without a C residence permit.

Consequently, the following persons may freely acquire real estate in Switzerland:

1. Swiss citizens or individuals holding dual citizenship, regardless of their place of residence.
2. Citizens of EU/EFTA countries with legal or actual domicile in Switzerland (holding a B residence permit, a C settlement permit, or, in some cases, an L permit for temporary residents).
3. Citizens of other foreign countries holding a C permit and with actual domicile in Switzerland.

The acquisition of real estate through a legal entity is permitted only if the company is domiciled in Switzerland and is controlled by persons who are also domiciled in Switzerland.

Therefore, foreign nationals cannot circumvent these restrictions by acquiring property through a Swiss joint-stock company. For the purposes of determining whether an acquisition is subject to authorization, the status of the ultimate beneficial owner of the property is decisive.

 

This regulatory framework, aimed at restricting real estate acquisitions by foreign nationals in Switzerland, has indirect implications within the Italian legal system through the principle of reciprocity.

Italy, like many other countries, applies the principle of reciprocity in recognizing civil rights for foreign nationals. According to this principle, a foreign citizen may enjoy certain rights in Italy only if Italian citizens are granted the same rights in the foreign national’s country of origin.

Unlike the Swiss legal system, the Italian legal framework does not provide for express limitations on real estate acquisitions by foreign nationals within its territory. However, any restrictions applicable under foreign legal systems become relevant in Italy pursuant to Article 16 of the Preliminary Provisions to the Italian Civil Code (Preleggi).

As a result, a Swiss citizen who is not domiciled in Italy may acquire real estate under the same conditions imposed on Italian nationals who are not domiciled in Switzerland.

However, unlike the Swiss system, a Swiss citizen does not need to obtain prior authorization from the Italian authorities to complete the acquisition. Instead, it is the Italian notary, during the preparatory phase of the sale and purchase transaction, who is responsible for verifying compliance with all applicable legal requirements.

Avv. Sara Botti

Head of Italian Law Practice Group

VALLONI Attorneys at Law