The Swiss government has adopted new laws against money laundering so that lawyers, notaries and other advisers are required to comply with due diligence obligations.
The anti-money laundering reforms follow recommendations by the Financial Action Task Force's (FATF) 2016 mutual evaluation report.
"The proposal will renew Switzerland's defence mechanism for money laundering and terrorist financing by taking account of the latest risk assessments", said the Swiss Federal Council.
The proposal will renew Switzerland's defence mechanism for money laundering and terrorist financing by taking account of the latest risk assessments"
"It also implements the Federal Council's financial market policy [of] ensuring international compliance in the area of money laundering," it added.
The "Panama Papers" put the role of lawyers in the spotlight. The papers show that 1,339 Swiss lawyers, financial advisers and other middlemen had set up more than 38,000 offshore entities over the last 40 years. These entities listed 4,595 officers - or administrators - that are also connected to Switzerland.
In this context, the Federal Council concluded that stricter regulations were needed.
Adviserswill not only have to comply with due-diligence obligations and a duty to verify, but will additionally have a new reporting duty. However, the measure will only cover services for domiciliary companies or trusts.
Also, financial intermediaries will be able to terminate a business relationship if they do not receive any feedback within 40 days of submitting a report to the Swiss Money Laundering Reporting Office.
The statement also draws a distinction between the 'right to report', which is being maintained, and the new 'reporting duty'. This will be clarified when the Bill is published.
The measures are not expected to come into force until the start of 2021 at the earliest.
International standards are set by the FATF, in which Switzerland also participates. It regularly checks whether the laws of its member states comply with its recommendations. Switzerland's next country review is scheduled for 2020.
In the previous round, the task force identified weaknesses and made recommendations that also concerned Swiss associations and their potential misuse for terrorist financing or money laundering.
The Federal Council is focusing on associations that are involved in collecting or distributing money for charitable purposes abroad to reduce that risk.