The United States has seized funds that Switzerland paid for F-35 fighter jets in retaliation for Bern's suspension of payments for Patriot air defense systems, according to Swiss defense officials, marking a sharp escalation in a financial dispute between Washington and one of Europe's historically neutral nations.
The confrontation, first reported by Swiss broadcaster SRF, stems from Switzerland's 2022 order for Tomahawk cruise missiles, which the U.S. State Department subsequently refused to export on grounds that Swiss neutrality laws would prevent the missiles from being used in collective defense operations. When Bern responded by halting payments for Patriot systems, the Pentagon moved to seize approximately $630 million in F-35 program funds already transferred by the Swiss government.
"The Americans have simply taken the money we paid for the F-35s," a senior Swiss defense official told SRF. "Our payment suspension was intended to create leverage for negotiations. Their response is to seize funds for an entirely separate program. This is not how allies are supposed to treat each other."
The dispute illustrates the increasingly transactional approach to alliance relationships under the Trump administration, which has shown willingness to use economic and financial pressure even against longstanding partners. It also highlights the vulnerabilities that smaller nations face when purchasing major weapons systems from the United States, which retains significant leverage through multi-year payment schedules and export licensing requirements.
To understand today's headlines, we must look at yesterday's decisions. Switzerland voted in 2020 to abandon its traditional policy of armed neutrality that prohibited advanced offensive weapons, instead approving purchases of F-35 stealth fighters and long-range strike capabilities. That decision, controversial among the Swiss public, was predicated on the assumption that the United States would honor contractual commitments. American refusal to export the Tomahawks—and subsequent seizure of F-35 funds—has vindicated critics who warned against dependence on U.S. defense systems.
Switzerland ordered 36 F-35A fighters in 2021 for approximately $6 billion, with deliveries scheduled to begin in 2027. The country has already paid roughly $1.8 billion as part of the phased payment schedule required for participation in the F-35 program. In addition to seizing the $630 million related to current-year payments, U.S. defense officials have indicated that future Swiss access to F-35 technology transfers and pilot training could be suspended until the Patriot payment dispute is resolved.
The Tomahawk dispute dates to Switzerland's 2022 request to purchase 100 BGM-109 cruise missiles with a range of 1,600 kilometers, weapons that would give Swiss forces the ability to strike targets deep inside potential adversary territory. The State Department delayed the export license for nearly two years before formally denying the request in January, citing concerns that Swiss neutrality laws would prevent participation in NATO collective defense operations and could theoretically allow the missiles to be used in ways contrary to American interests.
Swiss officials responded in February by suspending payments for five Patriot air defense batteries ordered in 2023, arguing that if Washington would not honor the Tomahawk contract, Bern was entitled to withhold payment for other systems until the dispute was resolved. The Swiss payment suspension affected approximately $1.2 billion in Patriot-related contracts.
The Pentagon's decision to seize F-35 funds represents a significant escalation. Defense analysts note that the move conflates three separate contracts—Tomahawks, Patriots, and F-35s—and effectively uses Swiss investment in the fighter program as a hostage to resolve an unrelated export dispute.
"This sets an extraordinary precedent," said Mauro Mantovani, a defense policy specialist at the University of St. Gallen. "If the United States can unilaterally seize funds paid for one weapons system to offset disputes about another, smaller nations have no financial security in defense contracts with Washington. Every payment becomes a potential bargaining chip."
The Swiss Federal Council has summoned the U.S. ambassador to Bern for consultations, while parliament's defense committee has demanded a full accounting of all funds paid to American contractors and their current status. Several Swiss lawmakers have called for cancellation of the F-35 program entirely, though defense officials note that Switzerland has few alternatives given the long lead times required for fighter aircraft procurement.
The dispute has also complicated Switzerland's relationship with NATO. While Bern is not a NATO member and maintains formal neutrality, it has deepened defense cooperation with the alliance in recent years and participates in air policing arrangements with neighboring countries. The U.S.-Swiss financial confrontation has raised questions about whether Switzerland can maintain security partnerships with NATO members while simultaneously being targeted by American financial pressure.
European defense officials have watched the dispute with concern, viewing it as an example of American willingness to leverage weapons sales for political objectives. Germany, Finland, and Poland are all major customers for American defense systems and have similar multi-year payment schedules that could theoretically be subject to U.S. seizure if disputes arise.
A State Department spokesperson declined to address the specific details of the Swiss case but said that U.S. defense exports "are contingent on recipient nations meeting contractual obligations and complying with end-use requirements. We work closely with partners to resolve any disagreements that arise."
Swiss Defense Minister Viola Amherd is expected to address parliament next week about the dispute and may propose suspending additional payments to American contractors until the matter is resolved. Some Swiss officials have privately suggested exploring legal action against the United States in international arbitration, though the prospects for success are uncertain given American sovereign immunity claims.
