Switzerland warns its companies that no, they can't dodge Trump's tariffs by routing goods through Liechtenstein

Switzerland and Liechtenstein have long shared an economic market, but President Donald Trump has imposed a steep tariff on Swiss goods compared to its Liechtensteiner neighbors. The Swiss government has clarified that Swiss businesses will be unable to reroute their products through the neighboring principality. The Trump administration recently implemented a 40% tariff on transshipments, or the movement of goods to an intermediate destination ostensibly with lower levies, to disincentivize this behavior.

The Swiss government is telling its domestic companies that they have not, in fact, found a clever way to skirt President Donald Trump’s tariffs by routing goods through the tiny neighborhood country of Liechtenstein.

Switzerland and Liechtenstein share a 102-year-old customs treaty allowing the 25km-long principality to share the Swiss economic area. But that agreement, which makes it nearly impossible to measure trade between the two closely linked countries, does not mean they are tariffed similarly. While U.S. tariffs on Swiss exports swelled to 39% in Trump’s latest round of tariffs, levies on goods from Liechtenstein are only 15%. The Swiss State Secretariat for Economic Affairs (SECO) has said Swiss firms cannot pass off goods as Liechtensteiner by routing them through the principality because they would still be recognized as Swiss in origin.

“Such circumvention via Liechtenstein is fundamentally impossible. The United States applies its non-preferential rules of origin when levying additional tariffs,” a SECO spokesperson told Fortune in a translated email statement. “For a product to be considered ‘Liechtenstein origin,’ it must either be entirely manufactured in Liechtenstein or [have] undergone sufficient processing.”

https://finance.yahoo.com/news/switzerland-warns-companies-no-t-165720069.html