No Duty To Return Retrocessions In Execution-Only Banking Relationships

Published today, the Swiss Federal Supreme Court's decision of 12 January 2026 provides for a much-awaited clarification on the treatment of retrocessions in execution-only banking relationships. The Swiss Federal Court ruled that banks are not required to return retrocessions received in pure execution-only relationships, distinguishing them from asset management mandates where restitution is mandatory, unless validly waived by the client.

Facts

A private bank maintained an execution-only relationship with a client from 2010-2017, receiving CHF 31,477 in retrocessions from fund promoters and product issuers. The bank's general conditions disclosed that it could receive third-party payments as supplementary remuneration and that the client had no entitlement to such payments. Restitution of the retrocessions was subsequently claimed under Article 400 (1) of the Swiss Code of Obligations (CO).