Sounds like they get away with it legally because the law applies to ISPs and they’re not an ISP.
From your link:
> Internet service providers in Switzerland are obliged to take measures to prevent access to these domains (DNS blocking).
I suppose that's it.
It still feels a little strange that that loophole is allowed: everyone who has a Swiss ISP could switch to Quad9 and be strictly better off. But if everyone does that, then the DNS ban is completely ineffectual. Maybe I should let sleeping dogs lie.
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