Starting a business in Switzerland: place yourself at the heart of Europe

The limited liability company - a GmbH in German-speaking cantons and SARL in French-speaking regions - is a popular structure for small to medium-sized enterprises. As a separate legal entity, the liability of its shareholders (known as partners) is limited to their capital contribution. A GmbH/SARL requires a minimum share capital of CHF 20,000 - which must be fully paid up at incorporation - and at least one managing director with signatory authority must be resident in Switzerland. This structure allows 100% foreign ownership and is subject to Swiss corporate income tax as well as tax at the cantonal level.

The stock corporation - AG (German) or SA (French) - is the more common choice for larger foreign investors and multinational groups, and is often used for subsidiaries, holding companies and regional headquarters. An AG/SA requires a minimum share capital of CHF 100,000, of which at least CHF 50,000 or 20% (whichever is greater) must be paid in at incorporation. Shareholders' liability is limited to their capital contribution, and shares can be easily transferred. The company must be represented by at least one individual resident in Switzerland with signatory authority and profits are subject to corporate income tax at the federal, cantonal and communal levels.

There are two main forms of partnerships used by foreign investors – the General Partnership (KlG) and the Limited Partnership (KmG). In both cases, there is no minimum capital requirement although partners must make a contribution as defined in their agreement. Registration is mandatory for partnerships conducting commercial business. The key difference is that the KlG must be formed by at least two natural persons who have unlimited, joint and several liability for all obligations, whereas a KmG requires at least one general partner (natural person) with unlimited liability and at least one limited partner (can be a legal entity) whose liability is restricted to their registered capital contribution.

A Swiss branch offers foreign companies a way to operate locally without creating a separate legal entity. As an extension of the foreign parent company, it can conduct commercial activities in Switzerland and enter into contracts. However, full liability for its obligations will remain with the parent.

Branch offices are commonly used when a foreign company wants market entry without having to establish a standalone subsidiary. A Swiss-resident representative with signatory authority must be appointed, and the branch is subject to Swiss tax on income attributable to its Swiss operations.

A representative office (or liaison office) allows a foreign company to establish a non-commercial presence in Switzerland, and its activities are limited to market research, relationship management, coordination and promotional work. As it does not generate revenue, it is generally not subject to Swiss corporate income tax. This structure is often used by companies assessing the Swiss market or supporting international operations without committing to a full commercial presence.

A Swiss Foundation (Stiftung in German, fondation in French) is an independent legal entity, with no owners or members, that pools assets for one or more specific purposes – usually philanthropic, family-related or wealth management. Foundations are established via a notarial act or will and must register with the commercial register to gain legal personality, and with the Federal Supervisory Authority of Foundations. Foundations deemed to be of public interest can benefit from corporate income tax exemptions on their income (notably donations) provided certain exemptions are met. A foundation can be created by natural persons or companies and are managed by a council (minimum of three members in the most common case) and a minimum contribution of CHF 50,000 is required. It's possible to set up foundations in any Swiss canton.

Setting up a company in Switzerland involves a range of costs, which can vary depending on several factors. Key considerations include your chosen entity, specific business activity as well as the location you want to operate in.

We can set out a clear and detailed overview of the expected costs based on your requirements, helping you plan more accurately across both financial and operational matters.

• Registration and licensing fees: Costs associated with company incorporation in Switzerland with the relevant authorities. This includes the Commercial Register, which is administered by the cantons under the supervision of the Swiss Confederation.
• Other relevant taxes and fees: These typically include a notary fee for company incorporation and any other legal transaction costs.
• Capitalisation costs: Capitalisation is dependent on the entity type, with a GmBH/SARL requiring a minimum investment of at least CHF 20,000 (fully paid up) and an SA/AG a minimum CHF 100,000 (with at least CHF 50,000 or 20% paid up, whichever is greater). The capital can be paid-up in cash but also in-kind (via the transfer of assets to the legal entity being setup).
• Visa costs: Expenses related to applying for the relevant residence and work permits or Type D long-stay visas.
• Office space rental: Costs for leasing office space, which can vary depending on the location, size and quality of the premises. Both Zurich and Geneva are known for their high costs. It is, however, possible to use domiciliation services to minimise rental costs.
• Professional fees: Costs for engaging professional services, such as legal counsel, company formation consultants and accounting services.
• Other potential costs: These may include translation costs, bank charges and other miscellaneous expenses.

At Hawksford, we take the time to understand your requirements and then follow a structured approach to complete your company incorporation in Switzerland. Our expert team can guide you through each stage, minimising potential delays and ensuring a seamless experience.

We usually start with a thorough consultation to gain a clearer understanding of your business objectives, operational requirements and longer-term goals. On that basis, we can then propose the legal structure, location and incentives most likely to suit your business.

Following the initial consultation, we can put together a strategic setup plan that outlines the most appropriate route for establishing your business in Switzerland. This can include company incorporation and registration, corporate structuring and any legal considerations relevant to your sector and proposed activities.

Our team can assist with preparing and processing the required documentation, helping to verify that your submission is accurate and compliant with Swiss regulations. This can cover drafting legal documents, completing application forms, opening a capital account with a commercial bank or an attorney, and securing necessary approvals from relevant government or cantonal authorities.

We can oversee your company name registration process in Switzerland, any sector-specific licensing and, where relevant, investment notification. Throughout the process, we can liaise with the relevant Swiss authorities to secure the necessary approvals and complete the required formalities.

If requested, we can assist with the application and processing of residence and employment permits for you and your staff, managing the documentation and communicating with the relevant authorities.

We can help with the opening of a corporate bank account in Switzerland, providing guidance on the required documentation and liaising with banks on your behalf. Our experience working with a wide portfolio of clients has also allowed us to build trusted relationships with several leading banks.

Beyond the initial setup phase, we can continue to assist with the practical aspects of establishing your business in Switzerland. This includes helping with office setup logistics and other essential services necessary for the smooth commencement of your business operations.

We can also support you with ongoing accounting and tax compliance, including corporate tax, VAT registration and filing, financial statement preparation and bookkeeping.

The overall timeline for setting up a business in Switzerland can vary from case to case. The factors outlined below can often determine how quickly the process moves. As your trusted partner, we can help coordinate the process of registering your entity in Switzerland and provide realistic timings for each requirement.

• Chosen legal structure: While the choice of entity type can influence the timeline, differences are relatively minor with company incorporation typically completed within a matter of weeks (although foundations can take longer).
• Complexity of business activity: Business activities that require special approvals from specific government entities may take longer to process.
• Special cantonal requirements: Timelines for each canton can vary, with some, such as Zug, having a fast-track process. These differences, however, are not usually substantial.
• Capital bank account opening for non-European Economic Area (EEA) beneficial owners: For most types of legal entities, the capital of the entity must be paid-up either partially or fully prior to incorporation. Onboarding processes of commercial banks can result in delays, notably for entities with beneficial owners residing in non-EEA countries.
• Efficiency of document processing: The time it takes the relevant authorities to process documents can also play a role.

Our expertise and proactive approach can provide your company with a more structured and manageable process for entering the Swiss market. We can provide clear guidance on the required steps and potential bottlenecks, enabling you to meet deadlines and prepare effectively. We can also work with you to ensure all documentation is accurate, complete and submitted correctly, so avoidable delays are kept to a minimum.

• Initial planning and document preparation: Typically 1 to 2 weeks.
• Capital account opening and capital injection: 4 to 6 weeks when completed remotely. Can be expedited by visiting Switzerland for 2 to 3 working days.
• Company registration and licensing: Generally around 1 week.
• Visa processing (if required): Usually takes 2 to 3 weeks.
• Bank account opening: Typically between 2 and 3 weeks.

If you're looking to expand operations in Switzerland, we can provide timelines based on your company's specific circumstances and keep you updated throughout the setup process. With clear communication and proactive management at each stage, your incorporation in Switzerland can be handled smoothly and in line with the country’s legal and regulatory requirements.