A. CORPORATION (SA/AG)
The most common form chosen by companies when incorporating a legal entity in Switzerland is the Corporation (or Joint Stock Company AG/SA). The formation of a corporation in Switzerland requires the following:
- Incorporators: Three persons or entities must act as incorporators and initial shareholders; they need not be Swiss citizens or residents
- Capital: a corporation must have a share capital of at least CHF 100,000
- Articles of Incorporation: This must state the company’s name, domicile, purpose, share capital, and the basic organization of the corporation
- Board of Directors: The majority of the members must be Swiss citizens or citizens of a member state of the EU or the EFTA and must be domiciled in Switzerland
- Auditors: The incorporators must appoint one or more auditors. At least one auditor must have its domicile in Switzerland
After an incorporators’ meeting has been held, an application for the registration of the corporation must be filed with the Office of the Commercial Register alongside the following documents:
- The notarised deed of incorporation
- A certified copy of the Articles of Incorporation
- Declarations of acceptance from the initial board members and auditors
- A confirmation by a Swiss bank that the initial share capital has been paid in
- A board resolution concerning the constitution of the board of directors
The application must be signed by all the persons authorized to act on behalf of the corporation who have signatory power for the corporation. The corporation becomes a legal entity once it has been registered in the Commercial Register.
Registration in Switzerland is as 6-stage process, which is as follows:
- 1) In the presence of a notary public, draft the articles of association, who will notarise the signatures on the form, and authenticate the articles of association and deed of incorporation. This takes 7 days and costs approximately 0.1% of capital.
- 2) Deposit the capital into a bank account. This takes a day.
- 3) Submit the deed which certifies the articles of association to the local commercial register, which takes 9 days and costs approximately 600 CHF plus 0.02% of capital.
- 4) After receiving an assessment in the mail, pay stamp tax at either the post office or a bank. This takes 1 day and costs approximately 1% of capital.
- 5) Register with the Federal Tax Administration for VAT. This takes one day.
- 6) Register employees with the social insurance system. This takes one day.
B. LIMITED LIABILITY COMPANY (GMBH/SARL)
Since the reform of its regulations, the Limited liability company (GmbH/Sarl) has also enjoyed increasing popularity in Switzerland. Its formation requires a minimum shareholders’ equity of CHF 20,000. At least one managing director must be a Swiss resident (not a Swiss national), and the company must have a minimum of two original shareholders. These founders are permitted to perform the duties of governing bodies. Whereas these businesses are less expensive to establish than a limited company, it is more difficult to transfer shares. The incorporation of a Limited Liability Company requires two persons or legal entities acting as incorporators and initial quota holders. Incorporation procedures for LLC’s are the same as for corporations.