Setting up a Business in Switzerland
Corporate Forms
The business entities in Switzerland are governed by the Civil
Code in this country. At Federal Level, businesses are domiciled
in a particular canton. Each canton maintains a Commercial Register
(Registre du Commerce/Handelsregister), and the mandatory entries
in the Register of subscribers, directors, capital structure etc
have strict legal force. The Register is a public document.
Although the company name of may be freely chosen, it must be
different from already existing ones.
The forms of business entity which may be formed are :
| 1. |
Joint stock companies - Société
anonyme (SA) /Aktiengesellschaft (AG) and its variants |
| 2. |
Private limited liability companies - Société
à Responsabilité Limitée (SARL)/ Gesellschaft
mit beschränkter Haftung (GmbH) |
| 3. |
Partnership and its variants (Societe en Commandite, Société
en Nom Collectif). |
The last legal form is not much used by foreign investors. General
Partnerships (Societe en Nom Collectif) and Sole Proprietorships
(Raison de Commerce) are also possible.
The public and private limited companies are on the contrary the
most widespread forms of international business organization.
Due to the importance of these two types of legal entities, these
two business forms are hereinafter elucidated in more detail.
All companies trading in Switzerland must be registered in the
Register of commerce of the district where their registered office
or place of business is located. Many legal entities (e.g. stock
corporation, limited liability company) only come into legal existence
upon their registration in the register of commerce.
Joint Stock Companies
(SA/AG)
A stock company, hereinafter SA/AG, is a legal entity formed by
at least three individuals or companies with a registered share
capital and its own corporate name.
The formation of the AG requires the presence, in person or by proxy,
of three founders at the founders' meeting, in order to effect the
adoption of the articles of incorporation, the election of the members
of the board of directors and the auditors, and further resolutions.
The resolutions of the meeting are embodied in a public deed of
formation which, together with the articles of incorporation, is
submitted to the register of commerce. The incorporation is completed
with the entry of the AG into the register of commerce.
The minimum share capital is CHF 100,000. On the
day of the formation of the company, the fully paid share capital
must be deposited on a special account with an officially authorized
depository bank. At least 20 percent of the share capital represented
by registered shares or CHF 50,000 must be paid up upon constitution;
bearer shares must be paid in full. A contribution in kind is subject
to a special report by the founders, which needs to be confirmed
by the auditors.
The share capital can be divided into bearer or
registered shares of a minimum par value of CHF 0.1 each.
Bearer shares may be transferred by way of assignment,
or, if certificates are issued, by physical transfer. Registered
share certificates must be endorsed, and the transfer of registered
shares must be entered in the company's share ledger.
The shareholders' meeting may amend the articles
of incorporation, elect and discharge the board members and internal
auditors, approve the balance sheet and profit-and-loss statement
and declare dividends.
There are generally no restrictions with respect
to the nationality of the shareholders. However, the company's board
of directors must situate in Switzerland.
The liability of shareholders is limited to the amount of subscribed
for share capital.
Private Limited Liability Company
(SARL/Gmbh)
The limited liability company may be formed by two or more individuals
or entities.
The formation procedure for a SARL/GmbH is similar to the incorporation
procedure for a SA/AG. Both require the execution of a public deed
of formation by all founders. Such public deed, including the articles
of incorporation, must be submitted to the register of commerce
for the company's registration. Upon registration with the register
of commerce, the company is incorporated.
The registered share capital of the company must
amount to at least CHF 20,000 and may not exceed CHF 2 million.
At least 50 percent of the share capital must be paid in cash or
in kind by each of the members upon the formation of the company.
The share capital is divided into fixed quotas, and each member
participates in the company's capital with one quota corresponding
to the individual capital contribution.
The documents issued to the members for the quotas serve as a documentary
proof and are not negotiable instruments. Any transfer of a quota
requires a notarized deed and becomes effective only once the register
of commerce has been notified and has registered the transfer.
The members and all capital contributions or alterations
thereof need to be notified to the register of commerce on an annual
basis.
Each member holds one vote per CHF 1,000 contribution.
In general, all members participate jointly in
the management and representation of the SARL/GmbH, however, the
management of the company may be conferred to non-members.
There are no restrictions with respect to the nationality
of the members.
Members are jointly liable for the company's debts up to the registered
capital amount.
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