Robert Vogel, Switzerland

In Switzerland it is common to provide employees who rely on a car for business uses a company car. As a fringe benefit, the company car can often also be used for private purposes. The concrete arrangement concerning the private use, the liability and cost distribution is then set out in the employment contract. If the employee lives in the same customs area, the contractual arrangement suffices. Is this not the case, and the employee has its place of residence in another state, further precautions are required.

Switzerland ratified the Customs convention on temporary importation of commercial road transport vehicles in 1956. This allows the entry in another member state with vehicles without having to declare it under the condition that it will be re-exported. It requires although that the person using the vehicle does not have its place of residence in Switzerland. This means that people from Switzerland can cross the border with their car that is registered in Switzerland without declaring it.

If someone is driving a foreign company car in Switzerland, the car has to clear customs. To avoid this, the employee could also obtain an authorization of the Swiss customs administration to temporarily use the company car in Switzerland. The so-called authorization 15.30 has to be got hold of when the car crosses the border for the first time. In this case, the employee is only allowed to use the car for business purposes or to travel between the place of residence and the place of work. Journeys in Switzerland only for private reasons are not covered by the authorization.

Furthermore, according to the regulation of admission of traffic, Swiss residents may not drive cars that are registered in a foreign customs territory. It doesn’t matter whether the driver is the owner or just a temporary user of the car. The regulation aims to prevent the circumvention of the Swiss compulsory insurance and vehicle inspections. Also this prohibition can be exempted with the authorization 15.30, if the vehicle is parked abroad for at least two weekends a month. As soon as it is taken to Switzerland for every weekend, it has to be registered in Switzerland. This is usually not in the interest of the employer who provides the car.

This leads to unacceptable situations when a employee is stopped at the border and informed that the foreign company car has to be declared and usually is fined because of the late declaration. If the employee then pays to clear custom, the authorization 15.30 can’t be issued anymore because this is merely possible for foreign cars. The only solution is to re-export the car and then get hold of the authorization 15.30.

The situation described does not only happen in Switzerland. Also residents of the European Union have to declare the foreign company car when passing the border. It is therefore highly recommended to obtain all necessary information about the relevant customs regulations.