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Related publications:
Swiss Company Law,
Commercial Register
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CORPORATIONS
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LIMITED LIABILITY COMPANIES
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CORPORATIONS AND LIMITED LIABILITY COMPANIES: ADVANTAGES AND DISADVANTAGES
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BRANCH OFFICES OF FOREIGN COMPANIES
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PARTNERSHIPS
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COOPERATIVE
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SOLE
PROPRIETORSHIP
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CORPORATIONS
Aktiengesellschaft (AG) ‑ Société anonyme (SA) ‑
Società anonima (SA)
Incorporators
The incorporation of a Swiss corporation requires three persons or entities
acting as incorporators. Such persons need not be Swiss citizens or residents.
The incorporators may, by notarized power of attorney, appoint one or more
proxies to form the corporation on their behalf. Accordingly, their presence in
Switzerland is not required. If the power of attorney is notarized outside
Switzerland, it must be accompanied by a so-called apostille under The Hague
Convention or superlegalized by a certification by a Swiss embassy or consulate
relating to the capacity of the foreign notary.
Incorporation Procedure in General
Swiss corporations are formed by notarized deed of incorporation. The
incorporators' meeting must be held before a Swiss notary public; however, as
noted, the incorporators may appoint a proxy for such a meeting.
The incorporators' meeting approves the articles of incorporation and elects the
corporate bodies required by law (board of directors and auditors). The
notarized instrument and the articles of incorporation are filed with the office
of the Commercial Register in the canton of incorporation, together with an
application for registration in the Commercial Register, declarations of
acceptance of the initial board members and auditors, and a confirmation that
the initial share capital has been paid in.
The corporation becomes a legal entity only upon its registration in the
Commercial Register. Notice of the registration is published in the Swiss
Official Gazette of Commerce. The entire registration process normally takes
approximately two to three weeks from the date of the incorporation meeting, but
may be shortened to around three business days upon consultation with the
competent Commercial Registry.
Special Incorporations
The law provides for additional requirements if:
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contributions for account of the share capital are made in kind;
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contributions for account of the share capital are made by setting off claims of
a shareholder against the corporation;
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the corporation intends to acquire assets following its formation; or
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special benefits are conferred on the incorporators or other persons.
In these cases, the incorporators must render a written report on the above
mentioned contributions or acquisitions. This incorporators' report must confirm
that the assets contributed to or to be acquired by the corporation are
adequately valued, and particularly addresses the appropriateness of the
benefits conferred on the incorporators. The incorporators' report must be
reviewed by the statutory auditors, who have to certify in writing that such
report is complete and accurate.
In addition to the federal stamp duty of presently 1% of the entire
consideration paid or contributed to the corporation's equity (nominal capital
plus premium) in excess of the first CHF 1,000,000, the costs of incorporation
include registration fees of the Commercial Register, notaries' fees, and
attorneys' fees.
Minimum Capital Requirements
The minimum share capital (also called "capital stock") of a Swiss corporation
is CHF 100,000. Upon incorporation (or a subsequent capital increase), the share
capital must be fully subscribed, but not necessarily fully paid-in: the
incorporators (or the shareholders' meeting in the event of a capital increase)
may elect to pay in as little as 20 % of the nominal capital (but in no event
less than CHF 50,000) to be paid in at the date of incorporation (or
subsequently at the occasion of any capital increase). The incorporators (or the
shareholders' meeting) may also choose to pay the shares in full, or to issue
shares at a premium over their nominal value. If shares are issued at a premium,
the amount of the capital surplus is booked in the statutory reserves of the
corporation.
In the event of a contribution in cash, the amount must be paid into a blocked
account of a Swiss bank prior to the incorporators' meeting (or the respective
board meeting in the event of a capital increase).
Capital Increase
A corporation's issued share capital may be increased by way of a shareholders'
resolution and a subsequent board resolution amending the articles of
incorporation. The corresponding shareholders' and board meetings must be held
in the presence of a notary public and the resolutions are recorded in a
notarized deed.
Swiss law provides for three different types of capital increase:
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Ordinary capital increase: The shareholders' meeting resolves on the
capital increase and empowers the board of directors to increase the capital
within three months.
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Authorized capital increase: By amending the articles of incorporation
the shareholders' meeting may authorize the board of directors to issue new
shares at its discretion within a period of up to two years.
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Conditional capital increase: The shareholders' meeting may indirectly
increase the capital subject to conditions by issuing (or authorizing the board
of directors to issue) rights to acquire new shares, e.g., options or conversion
rights. Such rights may be issued to the employees of the corporation, or may be
issued in connection with capital market transactions such as the issuance of
convertible bonds, bonds with stock options or similar instruments.
In all three cases, the existing shareholders have a pre emptive right, i.e., a
preferential subscription right on the newly issued shares or rights, in
proportion to their existing equity interest. The pre emptive right may be
suspended for cause by shareholders' resolution.
Share classes
The minimum par value of shares in a Swiss corporation is CHF 0.01. Shares may
be issued in the form of registered or bearer shares.
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Registered shares may be issued if at least 20% of their nominal value has been
paid in. Registered shares are transferred by delivery of the endorsed share
certificate(s), or by a written deed of assignment if no share certificates have
been issued. In addition, registered shares may be made subject to a transfer
restriction: the articles of incorporation may provide that registered shares
may be transferred only with the consent of the corporation. In such case, the
corporation may reject a request for consent to a transfer either for such cause
as is stated in the articles of incorporation or if the corporation offers to
acquire the shares from the seller at their intrinsic value. The possible causes
of transfer restrictions are listed in the CO. Special provisions regarding
transfer restrictions apply to corporations listed on a Swiss stock exchange.
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Bearer shares may only be issued if their entire par value has been fully paid
in. Bearer shares may not be subject to any transfer restrictions. Bearer shares
are transferred by delivery of the share certificate(s) is any such certificates
have been issued.
The identity of the shareholders is not recorded in the Commercial Register.
Dual-class Common Stock
A corporation may create classes of shares with different voting power by way of
issuing shares with different par values and stipulating in the articles of
incorporation that each share entitles to one vote irrespective of its par value.
However, the par value of the shares with increased voting rights must be at
least one tenth of the par value of the common stock; in other words, shares
with increased voting rights may have an up to ten-fold voting power compared to
shares of common stock. Shares with increased voting rights must be issued in
registered form
Non-voting shares
Swiss corporations are at liberty to issue so called participation certificates,
which more or less correspond to non voting stock in other jurisdictions. These
certificates do not entitle their holders to vote or to exercise any ancillary
rights such as the right to call a shareholders' meeting or to submit proposals
to it. However, participation certificates enjoy essentially the same pecuniary
rights (dividend entitlements, rights to liquidation proceeds and rights to
purchase new shares when issued) as ordinary shares.
Non-equity shares
Finally, a
corporation may also issue a type of equity security known as profit sharing
certificates (Genussscheine, bons de jouissance), sometimes translated as
non-equity shares. Profit sharing certificates have no par value and no voting
rights. They may, however, confer on their holder rights to a dividend,
entitlements to liquidation proceeds, or the right to subscribe for new
shares
Corporate Name
The name of the corporation may be chosen freely, provided that it does not
conflict with an existing firm name, is not misleading, and does
not serve for advertising purposes only. References in the firm name to any
geographical areas are allowed if they properly reflect the corporation's area
of activity.
In any event, it is recommended that a name be submitted to the Swiss Federal
Office for the Commercial Register and the competent cantonal Commercial
Register for approval before incorporation. Such approval can customarily be
obtained in approximately a week.
Business Purpose
Swiss corporation law does not have a theory similar to the "ultra vires"
doctrine: under Swiss law, a corporation may effect not only business
transactions that are expressly covered by the business purpose clause, but also
any transaction the corporation's business purpose may possibly entail. The
purpose clause contained in a Swiss corporation's articles of incorporation is
customarily drafted in a very general and broad way.
Corporate Bodies
The statutory corporate bodies of a Swiss corporation are the shareholders'
meeting, the board of directors, and the auditors.
Shareholders' Meeting
The shareholders' meeting is the supreme governing body of the
corporation. It has the authority
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to adopt and amend the articles of incorporation,
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to elect and dismiss the members of the board of directors and the auditors at
any time,
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to approve the annual report and the consolidated statements of account,
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to approve the annual financial statements and to resolve on the allocation of profits and to declare dividends,
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to release the members of the board of directors,
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to act with respect to other matters which are left to the shareholders' meeting
by virtue of statutory law, by the corporation's articles of incorporation or
any corporate organizational rules of the corporation
The shareholders' meeting is usually called by the board of directors.
Shareholders representing at least 10% of the share capital may request the
board of directors to call a meeting. Shareholders' meetings must be held at
least once a year; in particular, the meeting that approves the corporations'
annual financial statements and the allocation of profits must take place no
later than six months after the close of the business year.
Board of Directors
The business activities of a Swiss corporation are managed by or under direction
of its board of directors. The board is responsible for the execution of the
decisions of the shareholders' meeting, for keeping the corporate books and
minutes, and, in general, for the sound management of the corporation's
affairs.
Certain duties of the board of directors are inalienable and may not be
delegated to other bodies of the corporation, nor may they be transferred or
made subject to approval of the shareholders' meeting. However, the CO permits
the board of directors to delegate specific powers and duties, in particular
day-to-day business operations, to an executive management. Such delegation
must be based on special organizational rules that may only be enacted if the
articles of incorporation empower the board of directors to do so. The
organizational rules contain provisions governing the corporation's executive
bodies, the delegation of powers and duties, the supervision and control, the
meetings and decision making process of the corporate bodies and the reporting
system.
The board of directors may consist of one or several members, all of whom
must be shareholders or representatives of a legal entity which is a
shareholder. Record ownership of one share for each board member will suffice.
The majority of the board members must be Swiss citizens or citizens of an EU or
EFTA Member State residing in Switzerland. At least one board member residing in
Switzerland must either have single signatory power to bind the corporation or
must be empowered to sign jointly with one of the other members residing in
Switzerland.
The board members (although they may be only nominees) are jointly and
severally liable for mismanagement of the corporation. Within the past few
years there has been a substantial increase of court actions against board
members on the basis that they neglected to supervise the management
diligently.
Swiss Board members acting in a fiduciary capacity customarily receive an
annual fee in compensation for their administrative services and
responsibilities. The amount of the annual fee depends on the size and the
activities of the particular corporation. The annual fee customarily does not
include fees for legal services rendered by attorneys acting as board members.
Auditors
The auditors may be individuals or companies. They must audit the
corporation's books and records and make a report thereon to the
shareholders' meeting. If one auditor is appointed, he must be domiciled or have
a business establishment in Switzerland. When a corporation appoints several
auditors, at least on of them must be domiciled or have a business establishment
in Switzerland.
To be eligible, the auditors must fulfill the qualifications and independence
necessary for the performance of their duties. In the case of public or large
private corporations, the auditors must meet additional professional standards
that more or less correspond to the standards set out in the 8th Company Law
Directive of the European Union. Corporations are obliged to record the names of
their auditors in the Commercial Register.
Statutory Domicile
A
Swiss corporation must have a registered office in Switzerland. If there is no
need for a corporation to have office facilities and staff in Switzerland, a
local attorney or trust company may be willing to provide the requisite
registered office for an annual fee.
Ongoing Business
Operations
There are certain corporate actions that must be taken every year by a Swiss
corporation.
Annual Business Report
The board of directors must prepare an annual business report. The
business reports consist of:
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The annual financial statements (profit and loss statement, balance sheet
and notes to the accounts). The law provides for certain minimum requirements
with respect to the presentation of the accounts.
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The annual report rendered by the board of directors. This report has to
discuss the course of business as well as the financial condition of the
corporation. In particular, it has to enumerate the capital increases carried
out during the business year.
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The consolidated financial statements if required by law.
The annual financial statements of a Swiss corporation must, by law, be audited.
Interim Reports
There is no general legal requirement for Swiss corporations to publish
semi‑annual reports, but certain regulated companies (e.g., banks) and listed
companies are required to do so.
Accounting
Swiss accounting rules are less standardized than some of their foreign
counterparts, such as IFRS or US GAAP. In particular, the so-called true and
fair view principle does not apply to Swiss corporations (except if the
shares of such corporations are listed). Swiss statutory law provides for the
possibility of creating and dissolving so‑called hidden reserves, i.e.,
off‑balance‑sheet reserves. The creation of hidden reserves is possible if it is
done in the best interests of the corporation and the shareholders. The creation
and dissolution of such reserves have to be notified to the auditors, but not to
the shareholders.
Consolidation Requirements
Groups of companies are under the duty to publish consolidated accounts.
However, this provision only applies to major groups of companies, i.e.
groups that exceed two of the following three thresholds during two consecutive
business years:
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total assets of CHF 10 million;
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total turnover of CHF 20 million;
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an average of 200 employees.
Disclosure Requirements
Corporations with shares listed on an exchange or with bonds outstanding must
publish their annual and consolidated financial statements. Such publication has
to be effected either by publication in the Swiss Gazette of Commerce or by
forwarding a copy to every person requiring such information. corporations with
shares listed on a stock exchange also have to disclose, in their annual
business report, the identity of shareholders or organized groups of
shareholders with a title or beneficial interest of more than 5% of the voting
rights of the corporation. If the articles of incorporation provide for a lower
percentage limit for holding registered shares, such lower threshold also
applies for the purpose of disclosure. In addition, the Swiss Stock Exchange Act
of 1995 and the Listing Rules of the Swiss Exchange contain further disclosure
and related obligations.
All other corporations have to disclose their annual financial statements,
consolidated statements (if any) and auditors' reports only to shareholders, and
to creditors who assert a legitimate interest. If the corporation refuses to
disclose such information, the petitioner may seek an judicial order for
disclosure. Unlisted corporations do not have to disclose the identity of their
shareholders.
Corporations with shares listed on an exchange or with bonds
outstanding must publish their annual and consolidated financial statements.
Such publication has to be effected either by publication in the Swiss Gazette
of Commerce or by forwarding a copy to every person requiring such information.
corporations with shares listed on a stock exchange also have to disclose, in
their annual business report, the identity of shareholders or organized
groups of shareholders with a title or beneficial interest of more than 5% of the voting rights of the corporation. If the articles of incorporation
provide for a lower percentage limit for holding registered shares, such lower
threshold also applies for the purpose of disclosure. In addition, the Swiss
Stock Exchange Act of 1995 and the Listing Rules of the Swiss Exchange contain
further disclosure and related obligations.
All other corporations have to disclose their annual financial
statements, consolidated statements (if any) and auditors' reports only to
shareholders, and to creditors who assert a legitimate interest. If the
corporation refuses to disclose such information, the petitioner may seek an
judicial order for disclosure. Unlisted corporations do not have to disclose the
identity of their shareholders.
Custody Arrangements for Shares
Shares of Swiss
listed corporations are usually not printed as certificates, but place in a
collective custody system owned and operated by the Swiss banks. Share transfers
in the system are effected by book entry, no transfer of documents being
necessary.
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LIMITED LIABILITY COMPANIES
Gesellschaft mit beschränkter Haftung (GmbH) ‑ Société à responsabilité limitée (Sàrl) ‑ Società a responsibilità limitata
(Sarl)
The
incorporation of a limited liability company requires two persons or
entities acting as incorporators. By and large, incorporation procedures for
limited liability companies are the same as for corporations, in particular as
regards proxies, the incorporation procedure and special incorporations. The
corporate bodies of a limited liability company are the partners' meeting
and the managing officers. In other words, there is no statutory
requirement to appoint a board of directors, and the company is not required to
appoint auditors.
Capital
The capital of
a limited liability company shall not be less than CHF 20,000 nor more than
CHF 2,000,000. Any paid-in amounts in excess of CHF 2 million are accounted
for as capital surplus. Upon incorporation (or a subsequent capital increase),
the capital must be fully subscribed and at least one half must be paid in.
Capital contributions may be made in cash or in kind.
Quotas
The
contributions to the capital made by each partner determines the amount of his
quota. The quotas of the individual partners may vary but must be at least
CHF 1,000 or a multiple thereof. All quotas are recorded in a register
specifying the names of the partners, the nominal amount of the quotas and the
amount paid in on each partner's quota. At the beginning of each calendar year,
such register is filed with the competent Commercial Register at the place of
domicile of the limited liability company. The register is open to public
inspection.
The quotas
cannot be represented by a negotiable instrument such as the shares in a
Swiss corporation. The assignment of a quota requires the consent of at least
three quarters of the entire capital. The articles of incorporation may make an
assignment subject to certain conditions or may even prohibit the assignment at
all. The assignment is only valid if recorded in a notarized deed.
Liability of Partners and Supplemental Contributions
Other than the
shareholders of a Swiss corporation, the partners of a limited liability company
are to a certain degree jointly and severally liable for all debts of the
limited liability company. Such liability is limited to the amount of the entire
nominal capital of the company and the partners are discharged from this
liability to the extent that the company's capital was paid in and not reduced
by repayment or unjustified withdrawal of profit or interest.
Furthermore,
the articles of incorporation may provide for supplemental payment
obligations of the partners in excess of the amount of their quotas. Such
payments may only be used to cover a shortfall of assets in relation to
liabilities of the company.
Corporate Name and Business Purpose
The same as
outlined for corporation applies with respect to the corporate name and business
purpose of a limited liability company.
Corporate Bodies
The statutory
corporate bodies of a limited liability company are the partners' meeting and
the managing officers.
Partners' Meeting
The partners'
meeting is the supreme governing body of the limited liability company.
It has the authority
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to elect and dismiss the managing officers,
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to amend the articles of incorporation,
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to resolve on the allocation of profits and to declare dividends, and
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to act with respect to other matters which are left to the members' meeting by
virtue of statutory law, by the company's articles of incorporation or any
corporate organizational rules of the company.
Unless
otherwise provided by law or the articles of incorporation, resolutions by the
partners' meeting are adopted by an absolute majority of the votes cast. The
voting rights of each member are proportionate to the amount of their quotas.
Managing Officers
All partners
have the right and obligation to manage and represent the company collectively.
Such functions may, however, be delegated to one or more partners or third
persons in the company's articles of incorporation or by members' resolution. At
least one of the managing officers must reside in Switzerland (but not
necessarily be Swiss) and must either have single signatory power to bind the
company or must be empowered to sign jointly with another managing officer
residing in Switzerland. The managing officers are under a statutory covenant
not to compete with the business of the company.
There is no
intermediate body between the owner and the management as is performed by the
board of directors of a Swiss corporation which may delegate the day-to-day
management to executive officers and focus its activities on supervision and
control functions. The articles of incorporation of a limited liability company
may, however, provide for the appointment of such a non-statutory corporate body
and determine its specific powers and duties.
Auditors
The appointment
of auditors is not mandatory. If the authority to manage the company is
not vested with all partners, then the partners who are not managing officers
have the right to require from the managing officers information on all company
affairs and to inspect the company's books and records. The company's articles
of incorporation may substitute such supervision rights by providing for the
appointment of auditors. If the articles so provide, the qualification and
independence requirements as well as the powers and duties of auditors for Swiss
corporations apply respectively to these special auditors.
The company
must each year prepare an annual business report consisting of the annual
financial statements (profit and loss statement, balance sheet and notes to the
accounts), the annual report and consolidated financial statements (if
required). The same rules as for the Swiss corporations apply in this regard.
The quotas in limited liability companies are not negotiable and can,
therefore, not be listed on a stock exchange.
At the
beginning of each calendar year, the register of members needs to be filed with
the Commercial Register.
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Advantages of the Swiss corporation:
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There is no limitation on
the maximum share capital of a Swiss corporation which makes this type of
company more appropriate for larger business operations,
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the possibility of
authorized and contingent share capital facilitates the financing of the
business of a Swiss corporation,
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shares in Swiss
corporations may be more easily transferred than quotas in limited liability
companies, so that the corporation is the only appropriate form if the shares
are to be listed on a stock exchange or if a subsequent going public is intended,
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the corporate organization
of a Swiss corporation is more detailed and more appropriate for larger business
operations,
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the identity of
shareholders in a Swiss corporation is not registered in the Commercial Register
and, therefore, not open to public scrutiny.
Advantages of the limited liability company:
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Lower capital requirement (minimum capital of a Swiss corporation is CHF
100,000, of which CHF 50,000 must be paid in, whereas the minimum capital of the
limited liability company is CHF 20,000, of which CHF 10,000 must be paid in)
which makes the limited liability company an ideal company for small business
operations,
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neither a board of directors nor auditors are required by law for a limited
liability company which lowers the agency costs,
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the possible restrictions on the transfer of quotas in limited liability
companies are not limited which may be an advantage where control over the
company is a main concern (a similar result may however be achieved for a Swiss
corporation by means of transfer restrictions in the articles of incorporation
(to the extent possible) and additional contractual transfer restrictions in a
shareholders' agreement),
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the articles of incorporation of a limited liability company may confer
additional duties on the partners whereas the duties of shareholders in a Swiss
corporation are limited to paying in the nominal value of the subscribed shares,
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the transfer of quotas in limited liability companies requires a notarized
instrument and is thus more cumbersome.
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Instead of
incorporating a subsidiary in Switzerland, a foreign company may also establish
one or several branch offices. Branch offices have a certain organizational
and financial independence from the principal office: under Swiss law, a
branch office can enter into contracts and execute and settle transactions in
its own name, and can sue and be sued at its place of business. Legally,
however, the branch offices is part of the foreign company. If the foreign
company is liquidated or falls into insolvency, the effects of such liquidation
or insolvency also extend to the Swiss branch office.
A foreign
company may establish a branch office in Switzerland, if, among other things,
the following requirements are met:
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The foreign company must show that it is lawfully existing and duly incorporated
in its home country. For this purpose, the foreign company must provide the
competent Commercial Register with an excerpt from the foreign commercial
register or register of companies; if no such register exists under the law of
the foreign company's home country, the foreign company must otherwise provide
official evidence that it lawfully exists.
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The foreign company must provide evidence that the foreign company has decided
to establish a Swiss branch office. Such evidence may be brought by an excerpt
of the minutes of a meeting of the board of directors or other corporate body of
the foreign company which is empowered to establish branch offices.
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The Swiss branch office must be given a name pursuant to Swiss standards (see
below).
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The Swiss branch office must indicate the nature of its business or the business
purpose of the foreign company.
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The Swiss branch office must have one or several signatories authorized to act
on behalf of the Swiss branch office (see below).
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The foreign corporation may enact additional rules applicable only to the branch
office. Under certain circumstances, these rules are recorded in the Commercial
Register.
The
establishment of a branch office must be notified to, and registered with, the
competent Commercial Register. The corresponding application must be filed by
one or several members of the board of directors of the foreign company
authorized to act on behalf of the foreign company.
Name
The branch
office of a foreign company is limited in the choice of its corporate name. The
name of the branch office must indicate
Accordingly, a
permitted name for a branch office would be "Acme Widget Co., Inc., Chicago,
Zurich branch office".
Authorized Signatories
If a foreign
company establishes a branch office in Switzerland, it must record the persons
authorized to act on behalf of the branch office. The entry in the Commercial
Register may specify that authorized signatories may only act on behalf of the
branch office, not on behalf of the principal office of the foreign company. At
least one person - or two persons with joint signatory authority - must be
residing in Switzerland and must be recorded in the competent Commercial
Register as being authorized to act on behalf of the foreign branch office.
Scope of Application of Swiss Law
The Swiss
branch office of a foreign company is subject to Swiss law. This implies, among
other things, the following:
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The scope of the authority of
the authorized signatories to act on behalf of the Swiss branch office is
governed by Swiss law, not by the foreign law at the place of incorporation of
the parent company.
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The Swiss branch office of the
foreign company may sue and be sued at its place of business in relation to
matters arising from the business of such branch office.
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The Swiss branch office is
subject to the Swiss rules on the conflict of laws. Accordingly, certain
agreements and undertakings given by the Swiss branch office may be subject to
Swiss substantive law if the Swiss rules on the conflict of laws so provide.
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General Partnership
(Kollektivgesellschaft ‑ Société en nom collectif ‑ Società in nome collettivo)
A General Partnership is an
association of two or more individuals in a business firm, each partner being
jointly and severally liable. The association is based on the partnership
agreement which deals with the name, purpose of the business, capital
contribution, profits and losses, management (partners' powers), dissolution,
etc. The name of the General Partnership must bear the real name of at least one
partner with the suffix "& Co.," denoting partnership. The General Partnership
must be inscribed in the Commercial Register, giving at least the following
details: name, residence and nationality of each partner; firm name and domicile
of partnership; date on which business is started; and any provisions
restricting a partner's right to represent the partnership.
Changes in these details must
be notified to the Commercial Register for publication. The partnership
agreement deals with the relationship between partners. Taxation is assessed on
the partners as individuals and not on the partnership as such.
The partnership must keep
books and records in sufficient form to satisfy the partners. Consequently,
this requirement is dependent on the size and needs of the partnership. No
statutory audit is required by law, and there are no publication requirements
for partnerships.
Limited Partnership
(Kommanditgesellschaft ‑ Société en commandite ‑ Società in accomandita)
This is a business association
of one or more general partners (only individuals) having unlimited liability,
but with one or more limited partners (individuals or corporate bodies) who are
liable only up to a specified maximum amount. The name of the Limited
Partnership must include the real name of at least one general partner with a
suffix (e.g., "& Co.") denoting partnership. The inscription in the Commercial
Register is the same as for a General Partnership with the additional
requirement that the amount of capital of the limited partners must be
disclosed. All other matters are the same as for a General Partnership.
Simple
Partnership / Joint Venture
(Einfache Gesellschaft
‑ Société simple ‑ Società semplice)
A joint venture takes the form
of a simple partnership, which may serve economic and noneconomic purposes. Its
members are jointly and severally liable in the event of default. Relations
between members are usually determined by agreement but written agreement is not
necessary. For its formation, at least two partners (individuals or corporations)
must express the desire to achieve a common purpose by joint endeavors or means.
The joint venture may not be entered in the Commercial Register and does not
have a special protected name. Accounting and audit are subject to agreement
between the members. There are no disclosure requirements.
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(Genossenschaft ‑
Société cooperative ‑ Società cooperativa)
The cooperative is a legal
entity, a union of an open-ended number of members, although it must start with
seven members. It has no fixed capital.
Each member has one vote. Its
articles may provide for members' liability, but normally the liability of a
cooperative is the amount of its existing capital.
The inscription in the
Commercial Register, as well as the appointment of a statutory auditor is
necessary. A majority of the directors must be Swiss citizens domiciled in
Switzerland.
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Individuals with a residence
permit can set themselves up in any business; no specific permission is
required. The business must be inscribed in the Register of Commerce only if its
annual receipts exceed CHF 100,000. There are no legal audit or disclosure
requirements.
Is it necessary that
Meetings of the Board of Directors or of Shareholders are held in Switzerland?
No. Board of directors and
shareholder meetings can be held abroad, subject to tax considerations. However,
in case of minority shareholders the shareholder meeting should take place at
the registered office of the corporation.
What are the main
advantages of Corporations and Limited Liability Companies?
-
Corporations: no limitation on
the maximum share capital, possibility of authorized and contingent share
capital facilitates the financing of the business, more appropriate form for
larger business operations.
-
Limited liability companies:
low capital requirement, neither a board of directors nor auditors required,
more appropriate form for small business operation
For more information refer to
Section 3 - Detailed Information.
How much of a Corporation's
Share Capital has to be paid in?
In general, at least 20% of
the nominal capital but in no event less than CHF 50,000 has to be paid in.
Registered shares may be issued if at least 20% of their nominal value has been
paid in. Bearer shares may only be issued if their entire par value has been
fully paid in.
Is it necessary that the
majority of the Members of the Board of Directors are Swiss citizens?
No. The majority of the board
members must be Swiss citizens or citizens of an EU or EFTA Member State
residing in Switzerland. In addition, exceptions can be granted in cases of
holding companies with foreign subsidiaries.
May the Members of the
Board of Directors and the Management be liable to shareholders or creditors?
The members of the board of
directors and the management are jointly and severally liable to the corporation,
any shareholder and any creditor of the corporation for damages caused by
willful or negligent violation of their duties.
April 2006
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