The financial services company cited the example of official Swiss Railways watchmaker Mondaine, whose co-owner Ronnie Bernheim has claimed may have to shut a £7 million, two-year-old factory if claims from larger rivals that its watches simply “aren’t Swiss enough” were to become enshrined in law.
Since 1971, Swiss watchmakers have been allowed to use non-Swiss components for less than 50 per cent of the value of their watches’ movements. However, in 2007 the Federation of the Swiss Watch Industry – which includes companies such Swatch Group and Richemont – asked the Swiss government to add higher requirements on the use of Swiss components in the value of the entire timepiece, with the government proposing a new minimum of 60 per cent. Jean-Daniel Pasche, the head of the group, said a final decision could be made next year.
Bernheim added that the proposed rule changes would threaten jobs at producers of less expensive Swiss watches. Swiss-made watches were the country’s fastest-growing exports last year, and make up “one of the few manufacturing industries that have resisted a full shift of production to Asia,” according to Bloomberg.
“This law would be cutting the industry into two,” Bernheim continued in an interview in Basel. “The volume business will be killed, except for the big companies. Our foreign competitors are laughing.”