Self-Regulation Against Money Laundering in Art

PUBLISHED BY BILAN IN FRENCH IN JUNE 2017. Read here.

Original English Version Below:

SWISS ART MARKET FIGHTS MONEY LAUNDERING TAINT WITH A PUSH FOR SELF REGULATION

Priti Patnaik, February 2017

One can easily overlook a discreet corner of Geneva Palexpo, a convention centre in the outskirts of this small city, especially on a chilly winter evening in January this year, when temperatures plummeted below zero. The atmosphere inside was just as discreet, but warm with anticipation. Art dealers and underwriters mingled with prosecutors, lawyers, and forensic specialists to find out how self-regulation in the art market address money laundering.

Authorities and art connoisseurs had gathered for the launch of the Responsible Art Market guidelines for countering money laundering and terrorist financing threats.

The global art market is characterised by easily moveable goods of high value, its international nature, a culture of confidentiality, and lack of an art-specific regulation. This makes it vulnerable to potential criminal activity such as money laundering and terrorist financing.

In 2015, globally, the art market was pegged at more than $63 billion with more than half accounted for by dealers and private sales, the rest by auction houses, according to Arts Economics. To be sure, Switzerland accounts for only 2% of the total trade, but is also home to 10 freeports (tax-free storage sites) that reportedly house 1.2 million artworks and has more than 200 customs-free zones.

Geneva, the nerve centre of the Swiss art market, home to one of the world’s largest freeports, was dragged into a few money laundering cases in 2016 ranging from expressionist art allegedly bought with the tainted Malaysian 1MDB scandal money,  trafficked ‘cultural assets’ from Syria, and the trail of ‘Panama Papers’ that led to a raid in the Freeport which revealed the “Seated Man with a Cane” – a Amedeo Modigliani painting.

Of course, it was the Yves Bouvier affair in 2015 that firmly put Geneva on the map in the fight against money laundering in art.

The art community, in this city of private bankers and commodity traders, is now trying to take this business seriously to protect art and its reputation.

WHY SELF-REGULATION OF THE ART MARKET?

The Responsible Art Market (RAM) is a non-profit initiative, which has been built on the efforts by the Art Law Foundation and the Centre for Art-Law in Geneva since 2015. The initiative is backed by a range of actors in the Swiss art market, including galleries, dealers, auction houses, art advisors and service providers, lawyers, academics and authorities specialising in art related and compliance matters.

The RAM guidelines, as the founding group refers to this framework, include understanding risks, making risk assessments, knowing the customer, being alert to red flags, doing research on the artwork itself, understanding the nature of the transaction, keeping records, monitoring processes, being alert to suspicions and complying with the law, among others. An inter-disciplinary team behind this initiative devised these guidelines. The goal is to combine due diligence practices of the art world with the compliance procedures of the finance industry, the founding members told the art fraternity.

Sandrine Giroud, a partner at Lalive, a Geneva-based law firm, and Anne Laure Bandle,  director of the Art Law Foundation in Geneva, who worked on the initiative among others, told Bilan, “The vast majority of the arts business is done properly and there is not more money laundering than in other markets. Unfortunately, a few bad examples can taint the reputation of the entire industry which relies fundamentally on reputation. There are legal, reputational and financial risks for not only art dealers but also for all art businesses, advisors, ancillary services associated with the industry.”

THE ANTI-MONEY LAUNDERING FRAMEWORK IN SWITZERALAND

Ursula Cassani, Professor, University of Geneva, one of the speakers at the session said that self-regulation is complimentary to existing legal frameworks.

She explained that there are two types of legislations to address money laundering in Switzerland, one that addresses criminal offences and another that seeks to prevent money laundering through prudential rules. Both underwent changes in 2016.

Money laundering is an offence under Article 305bis in the Swiss Criminal Code. This offence can be committed by anyone, and in the context of the art industry – even by players in the art business and their clients.

“The criminal offence of money laundering is only punishable if the perpetrator acts with intent. If, for example, art dealers ignore red flags, then they become liable,” Cassani said.

In 2014, following international (Financial Action Task Force, FATF) recommendations, the Swiss law expanded the scope of the definition of money laundering to include proceeds from ‘tax fraud’ under certain circumstances. This amendment has been in force since 2016.

Predicate offences to money laundering were extended to include qualified tax crimes. Predicate offences include misleading the tax authorities by using false documents, in order to evade taxes for more than 300,000 Swiss francs per tax period. If assets resulting from such qualified offences are used as an investment in a work of art, such work could be seized in the context of money laundering proceedings.

The preventive rules are defined in the Anti-Money Laundering Act (AMLA 1997). This act applies primarily to financial intermediaries including banks, assets managers, money transmitters among others. Some players of the art business such as major auction houses and high-end dealers may be involved in transactions which qualify them as financial intermediaries. They also have also been subject to the provisions of the AMLA for many years. However, this is the exception, not the rule, Cassani said.

In addition to this, an amendment of the AMLA which entered into force in 2016 applies to merchants selling goods (art works, cars, jewels, real estate, etc.), if they accept cash in excess of CHF 100,000 for any particular transaction. However, the preventive requirements only apply to this cash payment. They do not apply if the payment is made in another form, e.g. through a bank. Furthermore, if CHF 100,000 are paid in cash and the rest through a bank, the AMLA does not apply, Cassani explained.

(This threshold has been problematic from a regulatory point of view, as we will see later.)

Dealers in cash deals over CHF 100’000 have due diligence obligations, unless they entrust a financial intermediary with transactions over CHF 100,000. The due diligence obligations include, identifying the contractual party, identifying the final beneficiary of the transaction and establishing the necessary documentation. In general, if an art dealer acts as a financial intermediary, the diligence requirements apply to all assets.

Bilan got in touch with the Money Laundering Reporting Office Switzerland (MROS) at the Federal Office of Police in Switzerland to find out if there has been an increase in the detection of money laundering activity related to art as a result of these new changes. “A year is a short period of time for effects of new guidelines to be seen,” Lulzana Musliu, Spokesperson, Federal Office of Police said.

STEPS TAKEN BY THE SWISS GOVERNMENT

Riccardo Sansonetti, Head of the Financial Crime section, State Secretariat for International Finance, Bern, who was a panellist at the session said, “Prevention of money laundering in art is important, as in every sector. The Guidelines issued in the context of the Responsible Art Market initiative show that private sector wants good practices, that it is a rather mature industry and there are efforts to raise awareness.”

On Switzerland’s role in combatting money laundering, the government is pleased with the recent endorsement of the Financial Action Task Force (FATF). The Paris-based FATF, seated in the OECD, sets the international standard in the fight against money laundering and financing of terrorism. As per FATF requirements, Switzerland conducted a national assessment of risks in 2015 that acknowledged the vulnerabilities of the art trade.

The FATF mutual evaluation report for Swizterland on anti-money laundering and counter-terrorist financing measures released in December 2016, indicates that the legislation and regulatory measures that are in place relating to freeports are sound and in line with the international standards, the SIF official said.

However, in the said report, FATF wants Switzerland to improve transparency. It says, “… these risk-reduction measures apply only to cash purchases of goods. They cannot establish any overall transparency in the art market, which appears necessary given the risks mentioned in the assessment report. Measures should therefore be taken to ensure greater transparency by all of the stakeholders concerned.”

To be sure, Swiss regulators have noted that despite recent amendments, regulations  will have little effect when, for instance, “transactions in art  are broken into fractional ownership pieces each having a declared value below enhanced reporting thresholds”, according to a testimony on ‘Terrorism Financing in the Global Art Industry’ to the Committee on Financial Services Task Force to Investigate Terrorism Financing at the United States House of Representatives in April 2016.

HOW TRANSPARENCY IN THE ART MARKET HELPS TRACKING MONEY LAUNDERING

Experts at the session, in essence wanted the art industry to work with authorities in the fight against money laundering. By following Know Your Customers (KYC) guidelines, art dealers can prove to be really helpful to authorities they said.

“Sometimes, art dealers know more about their customers than reputed banks. So dealers must be alert,” Jean-Bernard Schmid, Public Prosecutor, Ministère Public, Geneva, who was on the panel at the session said.

If art dealers ignore red flags, they become liable because they are helping ‘wash the money’ from illegitimate income, to enable it to enter the legitimate economy. If, for example, invoices disappear, then it is a problem, he explained.

“As a prosecutor, transparency is essential for me to investigate,” he emphasized.

The tightening of the rules for the financial sector globally has other impacts. Ralph Wyss, Partner in Deloitte Switzerland’s Forensic team said, “The risk for the art market being abused by money launderers is increasing because it can at least partly provide an alternative to the financial services industry which is under significant scrutiny.”

Insurers who form a critical part in the supply chain were also present at the event.

“As a title insurer serving this industry, the more we can see the entire market supply and distribution chain the better we can manage our business needs as well as the risks to the industry,” Lawrence M.  Shindell, Chairman of New York–headquartered, ARIS Title Insurance Corporation, told Bilan. The challenge is to achieve transactional transparency while protecting legitimate privacy interests, he added.

ARIS has been working on these issues with trade and financial regulators in the U.S., UK, Switzerland and the EU including Luxembourg, and Belgium. It has also met with regulators tasked with oversight of freeports and free trade zones. (See testimony cited above)

IMPORTANCE OF WORKING ACROSS INDUSTRIES

Major law firms as well as financial institutions and others can and do get caught up in these kinds of transactions. “The use of the international art industry for money laundering purposes is real and is likely a larger problem than some observers make it out to be,” Shindell said. And the reputational and legal risks of any implicated transaction are disproportionately high.

Until the problem of money laundering is attacked on a cross-industry basis, the market will not be able to make a significant dent in the problem.  The reason is the information is too fractured, he added. There is a need to link and cross-correlate information on source of funds and beneficial ownership between the art trade and its different stakeholders, the financial sector, property insurers, logistics firms and customs authorities, he suggested.

Sansonetti of SIF, also highlighted the difficulties in getting data on national and international levels to address money laundering in art, during his interventions at the session.

ARIS’s focus has included Switzerland because of the country’s transition to transparency in the financial industry, its reputational needs around freeports (not unlike similar needs elsewhere such as in Luxembourg ), its role in the art industry and the fact that Switzerland is able to act a single country jurisdiction independent of the EU.

“Switzerland in theory should be nimble and motivated to be part of creating and implementing pilot solutions to attack the problem correctly.  A small number of leading jurisdictions will have to take the important first steps on a pilot basis to move the industry to systemic change,” Shindell urged.

But there are practical and real challenges for this kind of cross-border regulation including the difficulties in piercing real beneficial ownership in different jurisdictions.

“Our jurisdiction stops at political borders. Even operating within the country, across cantons needs cooperation in various jurisdictions”, Schmid, Geneva prosecutor told the gathering.

However, what is very much within the borders of authorities are freeports.

The Swiss Federal Audit Office pointed out laxity in freeports in its report in 2014. Laurent Crémieux, of the Performance Audit and Evaluation Unit at the Swiss Federal Audit Office, said, “The customs offices had too much autonomy concerning the art and quality of the control activities inside freeports and warehouses.  We also found good practices and the customs administration must make these practices as norms.” The SFAO is expected to come up with a new report in 2018 to follow up on its recommendations.

To be fair, some freeports have started opening up. Marie Flegbo-Berney, Attorney-at-law and member of the board of directors of the Geneva Freeports told Bilan, that in 2016, the storage site adopted measures including, commissioning an independent audit to systematically control all archaeological objects entering its site, taking steps to restrict and monitor the site access and working to introduce biometrics. In 2017, it will install a biometric identification system.

Further, in accordance with the amended Swiss Customs Act, which came into force in January 2016, depositors at the Geneva Freeports are required to register the name of the owners of so-called “sensitive goods” in an inventory record, which is provided to the customs administration; works of art and antiquities fall under this category of “sensitive goods”, she explained.

The Geneva Freeports say that it requires identification of the beneficial owners of all its clients. Steps have been taken to improve the vetting procedures of its potential clients including by checking information on clients and their beneficial owners on existing national and international databases before offering them facilities, she added.

Self-regulation if followed judiciously could help the art market. There are lessons to draw from banks, experts said.

In the financial services industry the cost for investigations were often higher than the fines themselves, Wyss of Deloitte cautioned his audience.

Simon Studer, who runs his own dealership  and seeks a fair portrayal of the art market, implored to his fellow panellists “Don’t put the art industry on trial.” But that’s not the intention, irrespective of how much art is loved, authorities will need to keep asking questions.

ENDS

Read the previous story on the subject filed by this author. (In English)

Coworking Rules!

How I became a coworker and why I love it.

My recent story published by Swissinfo.ch (By the way, it is ‘coworking’ and not ‘co-working’ as I learned the hard way, after I got trolled by some of my coworkers!!)

Nearly half of the Swiss workforce are no longer be bound by location due to digital technology and the sharing economy. These trends have fueled a rise in coworking. I joined the bandwagon and here is why I ‘co-work’.

As an Indian journalist, I have been schooled in noisy newsrooms with excited fellow reporters and hovering editors. Even in my life outside of journalism, few offices were quiet, where reflection was genuinely valued. That’s not true with co-working spaces.

As any coworking evangelist will tell you, first and foremost such spaces are more about communities they host, than merely the physical space they inhabit. In such spaces, people work, together or individually, but often not for the same employer.

Coworking or hot-desking as it is sometimes called reportedly began in Berlin in the mid-1990s and took shape in San Francisco before becoming a global movement spreading around the world. Switzerland has also witnessed a mushrooming of coworking spaces as an alternative to traditional workplaces with the number now reaching about 100, up from 25 two years ago.  Predictably Geneva and Zurich have the greatest concentration, but interestingly there has been a surge in new spaces in suburban areas too, according to the association, Coworking Switzerland which represents nearly 80 such communities.

Finding the ‘space’

My journey into such a community began nearly two years ago in the midst of a career transition of sorts. It was also preceded by another solo journey. On a day long boat ride on the Irrawaddy river in Myanmar a few years ago, I had finished reading Susan Cain’s bestseller, ‘Quiet: The Power of Introverts in a World That Can’t Stop Talking’. Cain questions the “new groupthink” that has come to emphasise collaboration and open offices. What people really need is a quiet place to actually think and work. In an earlier interview Cain says: “The way people, particularly introverts like to get work done is by focusing for chunks of time and getting into a psychological state called flow.” The book spoke to me.

When I found Work’N’share, a modern space, flooded with light and soft colors, I knew I had found my refuge. A big, open office – formerly a garage and an architect’s studio, close to the shores of Lake Geneva in the beautiful city of Lausanne – has coworkers from diverse fields doing their mostly ‘chosen’ day jobs. While there are about 100 enrolled people, on an average day there will be about 25 of us.

The community is an assorted mix, from entrepreneurs launching food and beer companies, to coders, geeks in tech, life sciences and a few marketing professionals. I have also had the pleasure of working alongside scientists and designers, making special friends along the way.

Window seat

I usually sit by the window. There is no fixed space really, but somehow it has come to be my spot whenever I am at the ‘office’. Of course, one can rent a desk, grow roots and become a resident. Or you could simply be a ‘nomad’, come as often as you want. You can even wander in once a month and just pay for the day, and perch yourself at one of the many spots at the tall tables. We even had a trader who worked standing.

The place is full of adults who give each other space, and are fluent with the codes of respectful, quiet working. It will be hard to find bickering colleagues here. The atmosphere is congenial, perhaps because we are not competing as some colleagues would. While it is ‘too quiet’ for some, it is a paradise for those like me in the business of writing, and others, among them coders and developers.

Take a break

Once in a while, you will hear squeals of laughter and a lot of French (Lausanne is in French-speaking Switzerland) in the coffee space. Workdays are punctuated with small conversations ranging from uncomfortable political conversations to sharing experiences on raising venture capital. Some might step out to stretch their legs, go for a smoke or simply take in the fresh air. Come midday, folks end up having lunch together, or go running by the lake. If it is a Friday, you can grab a beer with the gang, or even do Yoga midweek.

“I love the ambiance here with a lot of people working independently,” fellow coworker Arthur Veenhuys, who runs a company offering carpentry design for offices, told me. “They enjoy what they do and are happy to go to work. It’s also nice to be exposed to people in such a wide variety of fields, which helps me get out of my world of construction.”

Events are also held to connect like-minded professionals belonging to other coworking spaces and others who may be interested. Such spaces are becoming important urban conduits with potential for creativity and innovation, when people meet others outside their work context often resulting in unexpected collaborations. Registered as a non-profit association, Work‘N’Share has a model where the operation is sustainable through scale – the more coworkers the better. The community expands when others visit the space for  such events, my coworking colleagues explained.

A 2016 Deloitte Report, The Workplace of the Future found that one in four people in Switzerland currently works as a freelancer. Among the remaining, a third would prefer to become freelancers in a year. Deloitte predicts that in future, half of all Swiss employees “would be able to perform their jobs on a mobile basis”.

Karl Frank Meinzer, Head of Real Estate Services at Deloitte Switzerland told swissinfo.ch that there are three driving forces behind the growing global trend of co-working that also apply to Switzerland. “The transformation of the economy towards a service-oriented, knowledge-based economy and the growing importance of digital technology have led to increasing numbers of people that can work on a mobile basis, unrestricted by location,” Meinzer says. In addition, the rise of the sharing economy has increased the number of freelancers which has also boosted the demand for coworking spaces, he adds.

More productive

The report found that companies have come to recognise this trend. Flexible work arrangements can reduce costs, make more efficient use of space, and lead to more productive employees.

Meinzer suggests that companies can also expand their external networks and benefit from the knowledge of others by offering coworking spaces themselves.

The trend in Switzerland is maturing although not yet saturated and “is no longer an underground option for bloggers and programmers,” says Jenny Schäpper-Uster, president of Coworking Switzerland.

Coworking is also a privilege, provided you are not tied to an employer who needs you to be at a traditional office every day.

Distractions

And working from home is not always a good alternative since it can be lonely or distracting or both. “Those who find it lonely miss the social interaction and discipline of a workplace. It is also easier to set limits between work and private time,” Schäpper argues.

There are several factors coming together – sociological, cultural, and economic – that favour coworking. The future of work may have arrived already.

“A woman must have money and a room of her own if she is to write fiction,” Virginia Woolf wrote in 1929, in ‘A Room of One’s Own’. Woolf may well have been alluding to a modern day coworking space, albeit not only for women. I think she would have been happy.

 

Regulation on financial speculation in agricultural commodities

First published in French in Bilan ahead of the vote.

Banning financial speculation on agricultural commodities in Switzerland – the only way to address food prices?

Priti Patnaik, 26 February

To weed out good speculation from bad speculation, is a good principle, but difficult to implement. The initiative to ban financial speculation of foodstuffs in Switzerland may or may not get enough support on Sunday, but it has certainly drawn attention to the role on financial speculators in contributing to volatility that ultimately impacts food prices. Instead of an outright ban of financial speculation, greater regulations, including imposing position limits, can be a more appropriate solution, experts say.

It is a complex subject with many nuances and no straight assumptions. It is vitally important because the commodity business contributes nearly 4% to the Swiss GDP, with nearly 550 companies in the country.

The group which has called for the vote believes that, financial speculation on commodities contributes to artificially-created demand, resulting in increased food prices. This, they say, increases the burden on the poor in developing countries who spend substantial part of their incomes on food.

COMPLEXITIES IN ESTABLISHING LINKS

The industry and the government are of the view that there has not been enough definitive evidence linking financial speculation to increases in food prices.

The reason why there is not enough evidence yet, is also because it is very difficult to measure this. However, there is unequivocal evidence that volatility in prices is caused by financial speculation. And it is this volatility that has some impact on food prices. Financial speculation exacerbates booms and busts in the cycle.

Ronald Jaubert, professor of development studies at the Institut de hautes études internationales et du développement (IHEID), Geneva, said “Volatility is a major problem for farmers and agro industries. There is a clear need to reduce volatility and thus to control speculation even if the effect on prices cannot be measured.”

Volatility impacts prices in the short term. But mostly, prices in the long term are still determined by actual  supply and demand. Just as there are studies that show that future prices have no impact on spot prices, there are also studies that prove that commodity futures market can have an impact on spot prices. As you can tell, that both sides have arguments, but surely there is enough evidence to think about ways to address excessive financial speculation.

The link between speculation and prices has also been hard to pin down for other reasons. Experts such as Sophia Murphy, senior advisor at the Institute for Agriculture and Trade Policy, who has done extensive work on the subject, points to the shifts evident in the 2007-2008 crisis, including the role of energy speculation and the link created by biofuels between food and energy markets.

To illustrate how integrated commodities can be, she draws attention to mixed indices that contain both food and non-food items. (Consider the direct link between corn and ethanol or soy and biodiesel.) “Factors other than food supply and demand are affecting prices and possibly changing production decisions in ways that do not respond to food security needs. It will be a challenge for legislation to separate fuel from food,” she added. Murphy also addressed a discussion on the subject at the International Institute for Sustainable Development in Geneva last week.

NOT ALL SPECULATION IS BAD

To be sure, speculation serves the purpose of ensuring liquidity and aiding price discovery. There is recognition that not all speculation is bad – including those for risk insurance purposes, physical traders who want to hedge their exposure to protect against price fluctuations, among others. Speculation does provide liquidity to hedgers.

The initiative by the socialists does make the distinction between hedging and financial speculators who can sometimes, affect or distort price levels in markets. The targets of the initiative – include investors such as investment funds, banks and financial arms of commodity companies.

The initiative hence seeks no ban on hedging, but on financial speculation.

The only trouble is, it is nearly impossible to differentiate one from another, except by categorising traders as those who have commercial purposes (physical traders) and those who don’t (non-commercial actors like banks). One cannot distinguish a hedging transaction from a speculative trade – apart from intent or motivation for a trade, which hard if not impossible tell.

The vote aims to limit financial speculation by such actors, because they have huge power to influence the markets and hence prices. There is not enough information on the extent of speculative activities that these actors undertake. The government acknowledges this.

Olivier De Schutter, the former United Nations Special Rapporteur on the right to food, explains, “Financial investors have taken an ever more important role, the volumes of financial transactions is now a multiple of the real volumes, and the markets at times therefore come to follow a purely financial or speculative logic.”

OPPOSITION TO THE INITIATIVE

Critics of the initiative are of the view that banning speculation, will not address food prices. Trading in agriculture commodities is typically, low margin, high volume transaction, where profits are derived from not just sale of commodities but a range of other factors including land, freight among others.

The government and the industry are wary of the legal uncertainty and costs that will result, in addition to potential job losses, which might result if the initiative gets enough support. Stephane Graber, Secretary General, Swiss Trading and Shipping Association, (STSA) says, “The initiative will result in creating more difficulties for the physical players to access the futures market, since they will need to establish that there are not performing paper trading but the hedging of physical trading”. Hedging activities will move out of Switzerland, threatening jobs, he says. The industry employs 12,500 people directly according to STSA.

The aim of the initiative is to discourage index funds, over the counter derivatives linked to agriculture commodities. SIX platforms, used by private and institutional investors based in Switzerland, are most likely to be affected if the initiative is accepted, the government said last year. But the trading volumes are not that high, it is acknowledged. SIX exchange quotes currently 120 ETFs and 36 exchange traded products in commodities.

EXODUS OF COMPANIES – AN EXAGGERATED FEAR?

If the initiative does get enough support, the government fears that the commodity business might shift to kinder jurisdictions. These fears are possibly overstated. After all, Geneva is also a major centre of trade finance that lubricates capital intensive commodity transactions. Apart from trading companies, the industry is supported by insurance companies, law firms, banks, accounting, forwarding, surveillance and security firms, and shipbuilders.

It is not clear whether a ban in speculation in Switzerland will affect the volume of overall speculation in other centres including New York, Chicago and London. The concentration of trading in a given geographical centre has less importance today, experts observe. Tighter regulations on the commodity business will become a reality in the future that companies will have to contend with, no matter where they are.

It is clear that firms located in Switzerland who trade with agro-derivatives over platforms in the US or the EU must comply with the rules in these jurisdictions, a spokesperson from SECO said.

MORE REGULATION – THE WAY FORWARD

Regulations are afoot. The Food and Agriculture Organization (FAO) set up the Agricultural Market Information System (AMIS). The Financial Market Infrastructure Act (FMIA), entered into force on 1 January 2016 in Switzerland, which seeks to put the Swiss regulatory environment in line with regulations in the US and the EU. The FMIA includes measures for more transparency and stability of financial markets, as well as position limits.

Olivier Heimgartner, a spokesperson for the Spekulation Initiative said, “Although the act was passed earlier this year, the government has not imposed any position limits.”

Position limits have been suggested so that major financial actors are prohibited from influencing the price variations by the sheer ability they have to mobilize huge funds (that they do not own) to bet on price variations, De Schutter says.

The leading position of Switzerland cannot be understated –  some of the commodities traded in the Geneva region include – 35% of the world’s cereals and oilseeds, 50% of the world’s coffee, 50% of the world’s sugar, 35% of the world’s rice, 35% of the world’s oil, as well as natural gas, ethanol, cotton, among others.

Gilles Carbonnier, Professor, Development Economics, Institut de hautes études internationales et du développement (IHEID), said, “Switzerland has an interest in not only participating in global discussion on the regulation of commodity trade or adapt to global trends and measures in the US or the EU, but also to take a certain lead in views of its position in the market.”

Irrespective of which side wins on Sunday, the Swiss government must take the lead.