Britain left the European Union, but its old trade deal with Switzerland was just a rollover from 1972. Now the two countries have finished negotiating a modern agreement that focuses heavily on services. The timing is tricky - the UK Prime Minister has resigned, and his likely replacement has not yet named a cabinet.
The two economies are dominated by services, yet the previous agreement had little to say about them. The new deal targets finance, technology, pharmaceuticals, and legal services. It improves how the two countries share and protect data, which is the lifeblood of modern business.
The objective of the new pact is to update the terms that carried over from a 1972 EU accord after Brexit. The older agreement mainly addressed merchandise and was created before the internet era of service commerce.
The UK has promised to keep "Regulatory Data Protection" for 10 years. That means after a new medicine is licensed, generic drug companies cannot use the original safety and effectiveness data to copy it for a full decade. Swiss President Guy Parmelin said the goal is "to firmly entrench it in an international agreement that binds the high levels of protection that are already applied by both countries."
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This regulatory data protection clause is particularly important for pharmaceutical firms, as it prevents generic competition for a decade and aligns UK and Swiss standards. It mirrors protections already in place domestically but now secures them in a binding international treaty.
The deal still needs to be signed before the end of this year, then approved by both parliaments. In the UK, the political situation is uncertain. Prime Minister Keir Starmer resigned last month, and former Greater Manchester mayor Andy Burnham is expected to take over. Britain's Business and Trade Secretary, Peter Kyle, expressed a desire to remain in his role, though Burnham hasn't announced his cabinet.
Parmelin noted that the negotiations took place "in a context marked by geopolitical tensions, the fragmentation of the global economy and the rise in protectionist trends." The deal is meant to lock in open trade between two large non-EU economies at a time when many countries are turning inward.
Kyle described the pact as "the most significant services trade deal the UK has ever negotiated."
Both countries plan to sign the deal before 2026 ends. Approval by the Swiss parliament and the UK parliament will then decide whether it takes effect. The outcome depends on whether the new British government backs the deal.
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