Vote Change

Still, parliamentarians have changed their vote in the past. In 2010, the UBS tax treaty for resolving a tax-evasion dispute between the U.S. and Switzerland’s biggest bank was approved by lawmakers in its three-week June session after initially being rejected by the lower house.

“More than a whole party will need to change course, and I think that’s difficult,” said Andreas Ladner, a professor of public administration at the University of Lausanne. “One is within the realm of speculation. Possibly there could be an indictment.”

The bill, which the country’s banks support, divides institutions into four categories based on the size of their American business and allows them to cooperate with the U.S. and hand over some information -- though not client names. Banks would have 120 days to decide whether to participate and to announce into which category they fall. They then have another 120 days to individually negotiate with the U.S. Department of Justice.

The program does not include at least 12 financial institutions, among them Credit Suisse Group AG and Julius Baer Group Ltd. and the state-backed Zuercher Kantonalbank and Basler Kantonalbank, which are already the subjects of a U.S. probe.

Employee Names

“At this stage it seems parliament is rejecting the bill,” said Paolo Dardanelli of the Swiss Politics Center at the U.K.’s University of Kent. “The government may have to act without parliamentary approval to authorize banks to cooperate with the U.S.”

While Swiss companies are usually prohibited from sending evidence to assist foreign legal proceedings, the country’s government authorized an exemption in April last year at the request of an undisclosed number of banks. Firms already under investigation including Credit Suisse and Julius Baer turned over employee names and information on cross-border business operations to the U.S. authorities.

A Swiss court in April rejected an appeal by a former lawyer at HSBC’s Swiss private bank against the handover of his and other employee names to U.S. authorities.

Still, Widmer-Schlumpf has stressed that the government won’t resort to emergency law, as it did with UBS, if the bill gets rejected.