Tokyo (SCCIJ) – At the March luncheon, Mr. Yves Bugmann, President of the Federation of the Swiss Watch Industry FH, gave an overview of the Swiss watch industry’s current state. He focused on combating counterfeiting and defending the Swiss-made label. More than 60 members and guests attended the event. We present the contents of his speech in a Q&A format.
How would you describe the current state of the Swiss watch industry?
Yves Bugmann: The industry consists of 680 companies, 250+ brands, and 65,000 employees. Switzerland is the No. 1 global exporter of watches in terms of value, exporting 16.9 million units, or 95% of its production, to 200 countries and regions. Exports grew after the pandemic and settled despite a setback in 2024 at high 26 billion Swiss francs.
What other interesting numbers help us comprehend the strength of Swiss watches?
Y.B.: One of the main strengths is mechanical watches, which account for a high proportion of export value. The production numbers are comparatively small, but their prices are high, which explains the high share of export revenue. 47% of all Swiss watch exports go to Asia, 30% to Europe, and 21% to America. 55% of all units are made of steel, and 28% of precious metals. Due to the latter’s higher prices, they contribute 39% of export value in 2024, while steel watches make up 34%.
What are the tasks of the Federation of the Swiss Watch Industry FH?
Y.B.: We define ourselves as the trade organization of the Swiss watch industry and contribute to the defense and development of the Swiss watchmaking industry. For example, we could put away a 20% import duty for watches in India by putting this issue into the Free Trade Agreement negotiations. We ensure good framework conditions for the sector, create technical standards, and provide export statistics to our members. We defend and protect the Swiss made label, fight against counterfeiting, and monitor international legislation. Our 450 members are producers, suppliers, or belong to related industrial branches. We have branch offices in Tokyo (with two employees) and Hong Kong.
Where do you see the main challenges for the Swiss watch industry?
Y.B.: China was our primary export market for many years. But last year, watch exports to China declined by about 21% due to the country’s economic difficulties. The watch industry hopes that the economic measures currently taken by the Chinese government will stimulate private consumption, which may increase the sales of Swiss watches. The second challenge is the counterfeiting of Swiss watches—the numbers and sophistication of the copies are growing.
The Swiss watch industry has introduced the label “Swiss made” as a measure against counterfeiting and as a sign of excellency in watchmaking. What does the label mean?
Y.B.: Already in 1890, the Swiss Federal Parliament passed a law protecting both trademarks and indications of source. A government ordinance regulated the name “Swiss” for watches from 1971 onwards and led to the “Swissness Project” of 2016. The main reason for protection is that the “Swiss” designation is worth money, because consumers associate it with quality characteristics such as precision and excellent craftmanship. Consumers are willing to pay an average of 20% or more for Swiss-made products, equivalent to 7.7 billion Swiss francs a year, because Swiss products, especially watches, are exceptionally reliable and of high quality.
What are the criteria for a watch to become a “Swiss made watch”?
Y.B.: A Swiss watch is a watch technically developed in Switzerland. For pure mechanical watches, at least the mechanical construction and prototyping of the entire piece must happen in Switzerland, and for watches not exclusively mechanical, additionally, the design of the printed circuits, display, and software must happen in Switzerland. “Swiss made” also means that the movement is Swiss and encased in Switzerland, the final inspection is carried out in Switzerland, and at least 60% of the cost price is generated in Switzerland.
What are you doing to protect the Swiss made label and to fight against counterfeits?
Y.B.: The Federation of the Swiss Watch Industry FH acts as a “guardian” of the Swiss made indication. We actively search for infringers and take legal action against them before the courts. We oppose trademark registrations containing unlawfully a Swiss indication like “Swiss Design” or carrying a Swiss cross. We operate a laboratory for technical analyses of counterfeit watches. We help organize raid actions, raise awareness of the issue, and support companies in protecting intellectual property. We train police and customs in other countries to recognize counterfeit Swiss watches. Our anti-counterfeiting group represents the 50 most famous Swiss watch brands and serves as a central contact point for authorities like police, customs, and other foreign government agencies.
Can you be more specific about the FH’s countermeasures?
Y.B.: Our lab technicians analyze the components of counterfeit Swiss watches. The five employees of our internet unit check the online offerings of alleged Swiss watches on dedicated websites, e-commerce platforms, and social media and try to determine whether these timepieces are counterfeit. One main criterion is a too-low price. Our people then alert the platforms or the authorities and ask them to shut down websites or stop false advertisements. Also, we intercept fake watches at the borders and request local authorities to raid shops and confiscate them. Also, we are raising awareness of this issue by publicly crashing counterfeit watches with a steam roller.
About the speaker
Mr. Yves Bugmann, President of the Federation of the Swiss Watch Industry (FH) since January 2024, earned his law degree from the University of Zurich in 1999. He later obtained a B.B.A. from Zurich’s Graduate School of Business Administration. His career began at the Swiss Federal Institute of Intellectual Property (IPI) in Bern, where he worked as a legal expert from 2000 to 2003. He then led the Trademark Research Department at the IPI from 2003 to 2006 before serving as Head of the Legal Division at FH from 2006 to 2023.
Text and pictures: Martin Fritz for SCCIJ
