Swiss banks could be­come world's data vault

The Financial Daily - - CONTINUATIONS -

GENEVA: Switzer­land, fac­ing an ero­sion of the bank­ing se­crecy laws that helped make it the world's banker, is now tout­ing its rep­u­ta­tion as a safe and sta­ble haven to be­come a global data vault.

More and more com­pa­nies are flock­ing to the wealthy Alpine coun­try to stock data in an era of in­creas­ing es­pi­onage and hack­ing, and the Swiss are reap­ing the ben­e­fits of the para­noia.

"Data stor­age is the new El­do­rado for Switzer­land. It's a real boom," said Franz Grueter, the manag­ing direc­tor of, a lead­ing data stor­age firm that has posted 30 per­cent an­nual growth since it was set up in 1995.

Thanks to Switzer­land's longheld bank­ing se­crecy tra­di­tion, the coun­try en­joys a global rep­u­ta­tion for se­cu­rity and pri­vacy.

But amid in­ter­na­tional pres­sure, the coun­try is be­ing forced to shed the pro­tec­tive shield that has made its banks so at­trac­tive, and has agreed within the next two years to au­to­mat­i­cally ex­change ac­count de­tails with other coun­tries.

While Swiss banks are suf­fer­ing, the coun­try's data stor­age com­pa­nies are boom­ing.

In the wake of rev­e­la­tions from for­mer US in­tel­li­gence con­trac­tor Ed­ward Snow­den of wide­spread snoop­ing by the Na­tional Se­cu­rity Agency, they are tout­ing Switzer­land's cher­ished rep­u­ta­tion to draw clients from around the globe.

"Clients need con­fi­dence, dis­cre­tion, re­li­a­bil­ity and sta­bil­ity. These have been the coun­try's hall­marks for­ever," said Grueter, who says more than one bil­lion francs (one bil­lion euros, $1.1 bil­lion) have been in­vested in data cen­tres in the coun­try over the past five years.

With its 61 data cen­tres, tiny Switzer­land is cur­rently Europe's fifth largest data hub, ac­cord­ing to the Data Cen­ter Map web­site.

Jean-Philippe Wal­ter, the fed­eral of­fi­cial in charge of data pro­tec­tion and trans­parency, said it was in Switzer­land's in­ter­est to of­fer clients a higher de­gree of pro­tec­tion than in other Euro­pean coun­tries.

Swiss laws on the is­sue are one of the most re­stric­tive in the world: Per­sonal data is de­fined as a "pre­cious good" that can un­der no cir­cum­stances be handed over to govern­ments or au­thor­i­ties with­out autho­ri­sa­tion from a judge.

This has been a mag­net for com­pa­nies such as Mul­tiven, an IT ser­vices firm that quit Cal­i­for­nia's Sil­i­con Val­ley in 2009 for Zurich.

"We re­lo­cated to Switzer­land in an­tic­i­pa­tion of this fu­ture and to lay the ground work for it," Mul­tiven's chief Deka Yus­suf told AFP.

See # 12 Page 11

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