It's actually a device for locking the mechanism that attaches the trunk to the bike. In the open position, turning the key in the opposite direction to that used for opening the trunk will allow the trunk to be removed. The closed position acts as a safety to prevent the mechanism from allowing the trunk off the bike accidentally. The first generation Norge trunks didn't have this - and more than a few departed their owners' bikes at speed, resulting in major damage to trunk and contents. Ask me how I know...
If the box is on the bike, the switch should be in the closed position and you should check that removal has been prevented.