Supreme Court Stays Orders Against UBS Switzerland AG

Supreme Court Stays Orders Against UBS Switzerland AG: Clarifies Foreign Entities Must Be Served Through Diplomatic Channels Under Section 105 CrPC

Court stresses that notices to foreign companies must follow international procedure, not direct service

Ruling highlights balance between India’s criminal law and global diplomatic protocols

By Our Legal Correspondent

New Delhi: October 24, 2025: The Supreme Court of India has stayed orders issued against UBS Switzerland AG, ruling that notices to foreign entities in criminal proceedings must be served strictly through diplomatic channels as provided under Section 105 of the Code of Criminal Procedure (CrPC).

The Bench, while hearing the matter, emphasized that Indian courts cannot bypass international protocols when dealing with foreign corporations or individuals. The ruling is expected to have a major impact on how Indian authorities pursue cases involving multinational companies, cross-border financial crimes, and foreign witnesses.

Background of the Case

The case arose from proceedings before the Calcutta High Court, where UBS Switzerland AG was made a party in a criminal revision matter. The High Court had directed that notice be served on the Swiss banking giant.

UBS challenged the order, arguing that under Section 105 CrPC, any notice or summons to a foreign entity must be routed through the Central Government and diplomatic channels, not served directly.

The company contended that the High Court’s order violated established international procedure and could set a dangerous precedent for cross-border litigation.

What Section 105 CrPC Says

Section 105 of the CrPC deals with reciprocal arrangements for assistance in certain matters and procedure for attachment and forfeiture of property. It provides the legal framework for:

Service of summons and notices on persons or entities located outside India.
Mutual legal assistance between India and foreign countries.
Ensuring that all communications go through the Central Government, which then uses diplomatic channels to contact the foreign state.

The provision is designed to respect sovereignty and international law, ensuring that Indian courts do not directly interfere with foreign jurisdictions.

Supreme Court’s Observations

The Supreme Court, while staying the High Court’s order, made several key observations:

Diplomatic channels are mandatory: Notices to foreign entities cannot be served directly by Indian courts or litigants. They must go through the Ministry of External Affairs and diplomatic routes.
Respect for international law: Direct service of notices would violate the sovereignty of foreign states and could harm India’s diplomatic relations.
Judicial discipline: High Courts must ensure that procedures under Section 105 are strictly followed in all cases involving foreign parties.
Balance of interests: While Indian courts have jurisdiction over cases filed here, they must respect the procedural safeguards laid down for international matters.

Why the Ruling Matters

This ruling is significant for several reasons:

Clarity on procedure: It settles confusion about whether Indian courts can directly serve notices to foreign companies.
Impact on financial crime cases: Many cases involving money laundering, tax evasion, and corporate fraud involve foreign banks and companies. The ruling ensures that such cases follow proper international procedure.
Strengthens India’s credibility: By adhering to diplomatic protocols, India shows respect for international law, which will help in securing cooperation from other countries.
Prevents misuse: Without this safeguard, litigants could misuse direct service of notices to harass foreign companies.

UBS Switzerland AG and Its Global Role

UBS Switzerland AG is one of the world’s largest banking institutions, with a strong presence in wealth management and investment banking.

The bank has often been in the spotlight in India due to cases involving black money, tax evasion, and cross-border financial transactions.
Indian authorities have, in the past, sought information from UBS and other Swiss banks under mutual legal assistance treaties (MLATs).
The present case highlights the continuing tension between India’s efforts to investigate financial crimes and the need to respect international legal procedures.

Previous Judicial Developments

This is not the first time Indian courts have dealt with the issue of serving notices abroad.

In earlier cases, courts have held that direct service of summons on foreign parties is not valid unless routed through the Central Government.
The Calcutta High Court, in August 2025, had controversially held that Section 105 CrPC was not mandatory in certain revision applications involving foreign parties. That ruling was widely debated in legal circles.
The Supreme Court’s latest order effectively overrides such interpretations, reaffirming that Section 105 must be followed in all cases.

Expert Reactions

Legal experts have welcomed the Supreme Court’s intervention.

International law specialists say the ruling strengthens India’s compliance with global norms.
Corporate lawyers believe it will reassure foreign companies that Indian courts will respect international procedures.
Critics, however, argue that the ruling could slow down proceedings in cases involving foreign entities, as diplomatic channels often take months.

Implications for Future Cases

The ruling will have wide-ranging implications:

Financial crime investigations: Agencies like the Enforcement Directorate (ED) and Central Bureau of Investigation (CBI) will have to strictly follow Section 105 when dealing with foreign banks.
Corporate disputes: Indian companies suing foreign corporations will face longer timelines due to diplomatic procedures.
Judicial consistency: High Courts across India will now be bound to follow the Supreme Court’s interpretation.

Conclusion

The Supreme Court’s stay of orders against UBS Switzerland AG and its clarification on Section 105 CrPC mark a turning point in India’s approach to cross-border litigation. By insisting that notices to foreign entities must be served only through diplomatic channels, the court has reinforced the importance of respecting international law while safeguarding India’s judicial process.

This ruling will not only affect high-profile financial crime cases but also shape how Indian courts handle disputes involving multinational corporations in the future. It strikes a careful balance between India’s sovereign right to pursue justice and the need to respect global diplomatic protocols.