A Swiss government plan to protect the country's banks from U.S. criminal charges has been thrown into doubt by a Swiss parliamentary committee's rejection of the proposed bill.

Lawmakers are deeply divided over the plan to allow Swiss banks, suspected of helping wealthy Americans hide their money, to disclose data to U.S. prosecutors to help settle investigations into tax evasion.

Switzerland's upper house of parliament is set to vote on the draft law, designed to solve the issue without overturning Swiss banking secrecy laws, on Wednesday followed by the lower chamber next week, a schedule aimed at meeting a U.S. ultimatum.

If the draft law succeeds, Swiss banks then have 120 days to hand over the internal information to U.S. authorities.

Possible outcomes include the following:

BOTH PARLIAMENT CHAMBERS PASS DEAL

Amid fevered last-minute haggling in Bern, potential concessions could still help swing the bill in parliament, even after the committee recommendation to vote it down. This would pave the way for Swiss banks to disclose their U.S. dealings, including names of bank staff and third parties such as accountants and tax lawyers who helped Americans evade taxes.

This in turn should enable potentially dozens of banks to reach their own deals with the United States, including on fines which sources have said might amount to $10 billion in total.

PARLIAMENT STALEMATE

If the bill passes Switzerland's upper chamber despite the committee's advice to vote it down, it is set to face even stiffer opposition in the lower house.

Should one chamber approve the draft law and the other reject it, the bill would enter a potentially lengthy mediation process to reconcile the two stances, effectively killing the deal given the U.S. ultimatum.

GOVERNMENT ENACTS U.S. DEAL WITHOUT PARLIAMENT

The Swiss government is desperate to get parliamentary approval for the deal it hammered out in years of negotiations, but could eventually take matters into its own hands and approve the agreement with an executive order, although circumventing a hostile parliament is seen as a risky gamble.

The Swiss government has so far refused to use emergency law to settle the matter as it did in the case of UBS in 2009 to end the threat of indictment of the country's largest bank.

UBS, which admitted it had helped wealthy Americans cheat on their taxes, paid a $780 million fine and handed over more than 4,000 client names as part of its settlement.

Any deal could still be held up or even knocked down by Swiss courts if bank clients, staff or third parties such as tax lawyers and custodians follow through on threatened legal action.

GOVERNMENT GRANTS DATA ON CASE-BY-CASE BASIS

Even without parliament's backing, the Swiss government could still grant banks individual approval to hand over data. Swiss data protection authorities have signalled their willingness to backstop such a handover, provided the involved parties are forewarned that their names will be made known to U.S. authorities.

SWISS BANKS HAND OVER DATA ILLEGALLY

Swiss banks could take their fate into their own hands and disclose data to U.S. officials in violation of secrecy and data protection laws in Switzerland. This option was rejected by UBS before it settled in 2009 and would undermine any government-backed resolution.

DEAL FAILS, BANKS RISK INDICTMENT

If the draft law fails in both Swiss chambers of parliament and a way is not found to meet U.S. demands, the Swiss government has warned the United States could indict another bank, a move which is seen as the death knell for any business.

In January, Wegelin & Co., Switzerland's oldest private bank, said it would shut its doors following a U.S. indictment on charges of helping wealthy Americans evade taxes through secret accounts. Wegelin later pleaded guilty, admitted wrong-doing and paid $58 million to U.S. authorities.