The standard of proof for control findings under SECO: step by step

A trading company's assets are frozen. The underlying Swiss ordinance designates the entity as "controlled by" a listed person. But control – actual, demonstrable, legal control – is exactly what the company disputes. Getting those assets unfrozen requires something more than saying so. It requires meeting a standard of proof that SECO applies deliberately and which, in our experience, far more applicants underestimate than overestimate.

The standard of proof for control findings under SECO requires objective, documentary evidence that the relationship between the listed person and the designated entity does not meet the control threshold established in Swiss sanctions ordinances. As of January 2026, SECO follows the Swiss legal tradition of administrative evidential sufficiency: evidence must be credible, coherent, and sufficient to displace the factual basis on which the designation was made. There is no single prescribed test, but the burden falls on the applicant to demonstrate absence of control – and that burden is real.

This guide walks through the process step by step: how control is assessed under SECO, where the evidentiary standards diverge from OFSI and the EU, how to build a file that can actually withstand scrutiny, and when to seek specialist counsel.

How a SECO matter begins: the designation and its factual basis

A SECO designation grounded in control starts life in an ordinance. The ordinance identifies the designated person and commonly cites the basis – typically that the entity is owned or controlled by a listed individual or organisation. That citation is the first thing to isolate. The factual basis that SECO or the underlying UN or EU measure relied upon is the target against which the standard of proof for control findings must be aimed.

Switzerland frequently aligns its autonomous measures with EU measures, as currently in force. That alignment matters enormously for the applicant, because it may mean the underlying factual assessment originated not in Bern but in Brussels. Where the control finding mirrors an EU Council Decision, challenging it before SECO alone addresses only one of two problems. The entity may remain listed in the EU, and the Swiss listing may simply be re-confirmed on the next review cycle unless the EU listing is also addressed.

In our practice, the first task after receiving a SECO designation is to determine whether the listing is autonomous or mirrors a UN or EU measure. That single question changes the architecture of the entire challenge. A purely autonomous Swiss listing can be contested directly through the SECO administrative process and, if necessary, by appeal to the Federal Administrative Court. A measure that mirrors a UN Consolidated List listing runs through the Focal Point or – for the ISIL and Al-Qaida regime – the Ombudsperson. A listing that follows the EU requires a parallel strategy.

The procedural starting point is a formal representation to SECO. Switzerland administers its sanctions through SECO under the relevant ordinances, and the applicable administrative-law rules govern how representations and reviews are conducted. The applicant has no time fixed by ordinance for bringing a challenge, but delay is costly: assets remain frozen, business is blocked, and counterparties exit the relationship.

What does "control" mean under SECO's ordinances?

Swiss ordinances do not define "control" with the same algebraic precision as OFAC's 50 percent rule (OFAC's rule treating entities owned 50 percent or more by blocked persons as themselves blocked). SECO's position is closer to the EU standard: control is a factual and legal question that looks at the substance of the relationship, including ownership and the practical capacity of the listed person to determine the entity's decisions.

The EU control test looks at both a percentage ownership criterion and the capacity to exercise decisive influence, as currently in force. Because Swiss measures frequently align with EU measures, Swiss ordinances inherit – at least by analogy – that broader conception. This creates a two-limb analysis. The first limb is ownership: does the listed person hold more than fifty percent, directly or indirectly? The second limb is influence: even below fifty percent, can the listed person determine the entity's strategic and operational decisions?

OFAC's position, for comparison, is more mechanical. Under the 50 percent rule, ownership of 50 percent or more in the aggregate by blocked persons is sufficient; a separate control test does not independently extend that rule in the same way. The difference is practically significant. An entity with a listed shareholder holding forty-three percent might be safe from the OFAC 50 percent rule – but could still be caught under SECO and EU analysis if that shareholder exercises board control, veto rights, or financial dominance.

Understanding this two-limb structure is the prerequisite for building the evidentiary file. Evidence that speaks only to ownership percentage without addressing influence is incomplete – and incomplete is insufficient.

Step by step: building the evidentiary file

The standard of proof for control findings under SECO is met through an evidentiary file that is documentary, coherent, and independently verifiable. There is no oral hearing at first instance in the normal case; the file is the argument. What follows is the sequence we use when instructed.

Step one: establish the corporate structure. The file begins with a clean corporate-structure chart that is sourced from commercial registries, notarised shareholder registers, and certified constitutional documents. Every intermediate holding company must appear. Where structures pass through jurisdictions with limited public registries, professional certifications from local counsel in the relevant jurisdiction may be required. The chart must be accompanied by the underlying documents – not just an illustration.

Aggregation errors are common here. Two persons each holding a minority interest may reach a threshold together if the Swiss authority aggregates them. The file must show not only individual holdings but also whether any concert or agreement exists between shareholders. Declarations from each significant minority holder that they act independently, supported by board minutes or shareholder-agreement extracts, address this risk.

Step two: document the governance and decision-making reality. Ownership is one limb; decision-making is the other. The file needs board-composition records, records of who appoints directors and how, minutes showing actual deliberation across a material period, and any shareholders' agreement that restricts or expands a given shareholder's rights. Where the listed person held rights that have since been extinguished – a buyback, a court order, an involuntary transfer – the evidence of extinguishment must be contemporaneous and certified, not reconstructed after the fact.

Signed statements from current management are useful but carry limited weight in isolation. SECO, like the EU General Court, prefers objective evidence over self-serving attestation. The EU General Court has held that control must be proved by objective and sufficiently weighty evidence – a standard that Swiss administrative practice applies by analogy. A well-drafted witness statement from an independent director or an external auditor who can speak to the actual pattern of decision-making is materially more persuasive than a statement from the CEO.

Step three: address the listed person's position directly. The file must meet the designation on its own terms. If the ordinance or the underlying measure says "controlled by [listed person]", the response must explain why that is wrong – specifically, with evidence. Explain the basis for any prior connection, explain what changed or why the original assessment was erroneous, and explain the current position. Vague assertions that the listed person "no longer has involvement" without documentary support will not move the analysis.

Where the listed person remains a minority shareholder, the file needs to show – document by document – that minority position does not translate to control: no right to appoint a majority of the board, no veto on operational decisions, no ability to block the distribution of profits, no personal guarantees over the entity's material assets.

Step four: prepare the legal analysis. The evidentiary file must be accompanied by a legal submission that maps the evidence to the applicable standard. This is not a formality. The submission tells SECO how to read the evidence, identifies the legal test precisely (ownership threshold and/or control), and explains why the totality of the evidence displaces the factual basis for the designation. Where Swiss practice aligns with EU measures, the submission should engage with the equivalent EU standard and demonstrate that the conclusion would be the same in both regimes.

Cross-regime coherence matters. If SECO concludes that the entity is not controlled – but an EU measure remains in force – a separate challenge before the EU General Court may be needed. Coordinating the submissions across both proceedings so that the legal arguments do not contradict each other is one of the technical disciplines that specialist counsel adds.

What is the standard of proof, and how is it applied in practice?

The standard is administrative sufficiency: the evidence must be sufficient to persuade the reviewing authority that the control finding is not established on the facts as they now stand, or as they stood at the time of designation. This is not a criminal standard and it is not a civil balance-of-probabilities standard in the English-law sense. It is a standard of administrative credibility and coherence.

In practice that translates into a threshold that is real but reachable. The reviewing authority will ask: does this file, read as a whole, displace the factual premise of the designation? If the answer is yes – if the ownership structure is plainly different from what was assumed, or if the named listed person's influence has been demonstrably ended by events that the documents verify – a de-listing or a licence to manage the assets can follow.

What it does not translate into is a rubber-stamp. A delisting is not automatic once the facts change. This is one of the most persistent misconceptions we encounter in practice. Even where there has been a genuine change in ownership or control – a buyout, a corporate restructuring, a court order removing the listed person from any role – the change does not take legal effect until it has been assessed by SECO and the relevant ordinance has been amended or revoked. Until that happens, the designation remains operative and the prohibitions remain in force.

This is why timing matters. The sooner a proper evidentiary file is assembled and submitted, the sooner the review clock starts. Reviews under administrative law do not run until the application is made. Every month of delay is a month of continued asset freeze.

How does the SECO process compare to OFSI and EU delisting?

Understanding where SECO sits among comparable regimes helps set expectations and informs the cross-regime strategy that complex matters require.

Under OFSI in the United Kingdom, a designated person may apply for a Ministerial review and, if that fails, seek judicial review in the High Court. The ownership-and-control test under UK law can catch a non-listed entity controlled by a designated person. The UK test turns on both ownership and actual control, similar to the EU and Swiss approach. One difference worth noting: OFSI has, in recent years, developed a body of licensing practice that can provide partial relief – allowing a business to manage frozen assets or wind down affected contracts – while a full review proceeds. SECO has equivalent licensing tools, and using them in parallel with a challenge to the designation itself is often the right tactical answer.

Before the EU General Court, an annulment action proceeds on the basis that the Council lacked a sufficient factual basis for the listing. An EU court ruling has confirmed that control must be proved by objective and sufficiently weighty evidence. The General Court applies that standard in both listing and de-listing contexts. One distinguishing feature of EU proceedings is the availability of document discovery through the Council's disclosure process – which can, in the right case, reveal weaknesses in the original designation dossier.

At the UN level, the Focal Point process for most Consolidated List entries and the Ombudsperson process for the ISIL and Al-Qaida regime operate differently again. The UN Ombudsperson carries out an independent review; the Focal Point routes the request to the relevant Sanctions Committee without an independent layer. Neither offers judicial review, and outcomes depend substantially on whether a listing state is prepared to revisit the designation. This is why a UN listing that has been implemented by Switzerland must be addressed at both levels.

For evidence of control or absence of control, all three regimes – SECO, OFSI, and the EU – converge on one principle: objective, documentary evidence is more persuasive than assertion. Practitioners advising on OFAC matters note that the same logic applies in the US context, even though the OFAC 50 percent rule does not have a separate control limb. Where an OFAC designation includes a control-based rationale, the evidentiary approach is similar in its insistence on documentary depth. See our companion work on evidencing absence of control under OFAC and on the EU standard for control findings for the comparator analysis.

Risk flags: when does a control challenge fail?

In our experience, control challenges fail for identifiable and avoidable reasons. Understanding them early prevents errors that cannot easily be corrected.

Incomplete ownership mapping. A file that identifies the first-tier shareholder but does not trace intermediate holding companies invites the inference that something is being concealed. SECO – like the EU – is alert to structures where a listed person appears to have stepped back but retains influence through an intermediate vehicle. Every layer must be documented, regardless of jurisdiction.

Contemporaneity is critical. Documents that post-date the designation by a substantial period without a credible explanation for the delay raise credibility questions. A corporate restructuring that conveniently occurred after a designation, without independent commercial reasons, will receive close scrutiny. The file must explain the chronology honestly.

Self-serving attestation without documentary support is routinely discounted. Declarations that a listed person "has no involvement" are useful as a framing document but are not evidence of the facts they assert. They need to be supported by board minutes, shareholder registers, banking authorities, and other independent primary materials.

Disregarding the EU dimension where Switzerland has aligned its measure. Where the Swiss ordinance follows an EU measure, challenging SECO in isolation leaves the EU listing in place. The next Swiss review cycle may simply re-confirm the listing on the basis that the underlying EU measure is unchanged. A complete strategy addresses both regimes concurrently. For a detailed examination of how EU control standards interact with this question, see our EU control findings guide.

Finally, treating the application as an administrative formality rather than a forensic exercise. SECO reviewers are experienced. They have access to the same commercial registries, company filings, and intelligence databases that produced the original designation. A file that recites facts without providing independent verification of them is not a file that meets the standard; it is a file that restates the problem.

When to instruct counsel, and what the engagement looks like

The decision to instruct specialist counsel should be made as early as possible – ideally before submitting anything to SECO. The first submission sets the framing. A poorly constructed initial filing can create inconsistencies that are difficult to walk back in a subsequent review or an appeal. There is no advantage in front-loading the process without specialist input.

The triggers for instruction are clear: assets have been frozen; a designated counterparty has caused a business relationship to be suspended; a business has received an inquiry from SECO regarding its counterparty; or a new sanctions ordinance has been adopted that names an entity in which the client holds an interest.

What the engagement involves, in sequence: first, a review of the ordinance and the factual basis for the designation; second, a cross-regime check to determine whether the listing mirrors an EU or UN measure; third, a document-collection exercise mapped to the two-limb ownership and control analysis; fourth, a legal submission to SECO; fifth, management of SECO's queries and any supplementary disclosure; sixth, if necessary, a parallel filing with the relevant EU or UN mechanism.

We act for multinationals, financial institutions, and exporters on sanctions and export-control matters across the major regimes. That cross-regime experience is directly relevant here: the SECO process does not operate in isolation, and the most effective challenges are built with a view to all applicable regimes from the outset. For the UN dimension of a designation challenge, see our guide to evidencing absence of control at the UN.

How long does the process take? Delisting timelines are measured in months to years, not weeks, and outcomes are not guaranteed. Administrative review takes time. Where a Swiss ordinance mirrors an EU measure, the Swiss review may outrun the EU process or lag behind it, depending on review cycles. Coordination across the two processes is part of the specialist's role.

This publication is general information and does not constitute legal advice. For advice on your situation, contact info@caldervance.com.