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No, it's not switchable. The ND is a tiny sliver of a filter, positioned very close to the diaphragm blades so that the edge of the filter is completely out of focus on the chip, and even small intrusions of the filter soak light from the whole frame.
As light levels increase the more the filter intrudes into the light path. So the lens goes to f/4 or thereabouts, then the internal ND will take over, probably soaking the next three stops. So an exposure that would need 1/50th at f/11 will actually be 1/50th and f/4 plus lots of ND. This happens in auto as well as manual, but of course you're not told about it, even on replay.
This gives much sharper pictures, because diffraction at small apertures (smaller than f/4) with very short focal lengths is very damaging to resolution.
tom.
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