Investment protection agreement signed with Bahrain
Berne, 17.04.2026 — On 17 April, Swiss president Guy Parmelin and Bahrain’s Minister of Finance and National Economy, Salman bin Khalifa Al Khalifa, signed an investment protection agreement between Switzerland and Bahrain on the fringes of the Spring Meetings of the World Bank Group and IMF in Washington.
The investment protection agreement provides safeguards against political risks that might affect Swiss investments in Bahrain, and vice versa. The agreement protects investors against any discriminatory measures by the state and unlawful expropriation, and guarantees the free transfer of investment payments. The dispute resolution procedure allows investors to refer any disputes that may arise under the agreement to an international arbitration tribunal.
Bahrain is the only country in the Gulf Cooperation Council with which Switzerland has not yet concluded an investment protection agreement. The new arrangement therefore serves to fill this gap.
A new approach to negotiations
The investment protection agreement with Bahrain is based on Switzerland’s new negotiating approach, which was first introduced in the investment protection agreement between Switzerland and Indonesia, in force since 1 August 2024. Unlike agreements previously concluded by Switzerland, it contains more detailed provisions designed to limit the discretion of arbitration tribunals over the interpretation and application of the agreement. Furthermore, special provisions relating to state regulatory powers, corporate social responsibility and the fight against corruption help to reconcile investment protection objectives with those of sustainable development.
With foreign direct investments exceeding CHF 1.34 trillion, Switzerland ranks among the world’s top ten exporters of capital. It has a network of over 110 investment protection agreements. Swiss investment in Bahrain has grown significantly over the past decade and is focused mainly on the finance and fintech sectors.
The investment protection agreement was signed by Guy Parmelin, President of the Swiss Confederation and Salman bin Khalifa Al Khalifa, Minister of Finance and National Economy of Bahrain, and will come into effect subject to internal approval procedures in both countries. In a next step, the explanatory memorandum accompanying the agreement will be drafted and submitted to the Federal Assembly for approval. The agreement will come into effect as soon as the internal approval procedures have been completed in both countries.