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Switzerland is in the process of enacting a change to the Mineral Oil tax Act[1] for which the Federal Cabinet had submitted a draft in May 2006 that provided the following:

Article 12 b.  Tax Exemption of Fuels from Renewable Raw Materials

  • (1)  Fuels from renewable raw materials are exempted from taxation. 
  • (2)  The Federal Cabinet [Bundesrat] will designate the fuels from renewable raw materials; in doing so, it shall take into consideration to what extent these fuels help to protect the environment.
  • (3)  The Federal Cabinet may impose minimum requirements for proving that an overall positive ecological balance exists.[2]

 The Swiss Parliament approved this amendment to the Mineral Oil Act but inserted a clause that would have preferred Swiss producers in the granting of exemptions, which in turn led to explanations by the Federal Cabinet that this would violate the principles of the World Trade Organization.[3]  The ensuing dispute delayed the promulgation of a regulation that would designate or describe environmentally suitable bio-fuels.  The regulation is expected to be promulgated and made public sometime early in the year 2008 but until now it has neither been published nor has its content been made publicly available.[4]

The Swiss Office for Energy commissioned a study on the ecological evaluation of bio-fuels that was published in April 2007.[5]  This extensive study examined the environmental costs of the production, processing and transportation of bio-ethanol, bio-methanol, biodiesel, and biogas, and came to the following conclusion:

Most of the environmental impacts can be attributed to the agricultural cultivation of the respective raw materials (feedstocks).  The environmental impact from fuel processing is usually much lower.  The environmental impact from the transport from the production site to Swiss filling stations is even less, even when the biofuels are produced overseas.  The present study shows that with most biofuels there is a trade-off between minimizing greenhouse gases (GHG emissions) and a positive ecological life-cycle analysis.  It is true that GHG emissions can be reduced by more than 30 % with a number of biofuels.  However most of these supply paths show greater impacts than petrol for various other environmental indicators.

It is reasonable to expect that the Swiss regulation will reflect these principles and make a determination according to environmental suitability.

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Prepared by Edith Palmer
Senior Foreign Law specialist
January 2008.

[1]  Mineralölsteuergesetz, Änderung,  Bundesblatt 2006 at 4289, available at

[2]  Translated by Edith Palmer.

[3] P. Mäder, Bundesrat will Gesetz umgehen, Tagesanzeiger (Jul.11, 2007), Lexis/Library News/fileZeitng.

[4]  Information obtained by telephone Jan. 29, 2008, from the Press and Information Officer of the Swiss Federal Finance Department.

[5]  R. Zah et al., Ökobilanz von Energieprodukten: Ökologische Bewertung von Biotreibstoffen.  Schlussbericht (Apr. 2007), available at  This study is written in German and has a very short English summary.

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Last Updated: 07/01/2015