When establishing a business in Switzerland, the most common types of companies are the AG (Aktiengesellschaft) and GmbH (Gesellschaft mit beschränkter Haftung). Both offer limited liability, meaning the owners’ personal assets are protected from business liabilities. Here’s a breakdown of the key conditions and formalities to consider for each type.
1. AG (Aktiengesellschaft) – Public Limited Company
An AG is a popular choice for larger businesses, especially those that plan to raise capital through shareholders or issue stocks. This structure is ideal for companies with several investors or plans for public listings.
Key Conditions and Formalities:
• Minimum Share Capital: CHF 100,000 (at least CHF 50,000 must be paid up front).
• Shareholders: At least one shareholder (can be an individual or a legal entity). There is no maximum limit on the number of shareholders.
• Board of Directors: The AG must have at least one director. If the company has more than one director, at least one must be a Swiss resident.
• Registered Office: The company must have a physical address in Switzerland.
• Articles of Association: Must be drafted and signed by the founders. These documents define the company's purpose, share structure, and governance.
• Public Registration: The company must be registered with the Swiss Commercial Registry. The process includes publishing the company’s formation in the official Gazette.
• Audit Requirements: Large AGs are required to appoint an independent auditor to review their financial records. However, small AGs may be exempt from this requirement.
Advantages of AG:
• Attractive for Investors: The AG structure is more appealing to external investors, especially those interested in buying shares or selling publicly.
• Limited Liability: The liability of shareholders is limited to the amount of their investment.
• Credibility: The AG structure is considered highly credible by banks and other institutions.
Key Conditions and Formalities:
• Minimum Share Capital: CHF 100,000 (at least CHF 50,000 must be paid up front).
• Shareholders: At least one shareholder (can be an individual or a legal entity). There is no maximum limit on the number of shareholders.
• Board of Directors: The AG must have at least one director. If the company has more than one director, at least one must be a Swiss resident.
• Registered Office: The company must have a physical address in Switzerland.
• Articles of Association: Must be drafted and signed by the founders. These documents define the company's purpose, share structure, and governance.
• Public Registration: The company must be registered with the Swiss Commercial Registry. The process includes publishing the company’s formation in the official Gazette.
• Audit Requirements: Large AGs are required to appoint an independent auditor to review their financial records. However, small AGs may be exempt from this requirement.
Advantages of AG:
• Attractive for Investors: The AG structure is more appealing to external investors, especially those interested in buying shares or selling publicly.
• Limited Liability: The liability of shareholders is limited to the amount of their investment.
• Credibility: The AG structure is considered highly credible by banks and other institutions.
2. GmbH (Gesellschaft mit beschränkter Haftung) – Limited Liability Company
The GmbH is ideal for small to medium-sized businesses or startups, as it offers a more flexible structure and lower capital requirements than an AG.
Key Conditions and Formalities:
• Minimum Share Capital: CHF 20,000 (must be fully paid up at the time of registration).
• Shareholders: At least one shareholder (can be an individual or a legal entity). There is no maximum limit on shareholders.
• Managing Director: The GmbH must have at least one managing director (can be a foreigner). The managing director does not need to be a Swiss resident.
• Registered Office: The company must have a physical address in Switzerland.
• Articles of Association: These must be drafted and signed by the founders, outlining the company's structure, purpose, and internal rules.
• Public Registration: The GmbH must be registered with the Swiss Commercial Registry, where it will receive its official legal status.
• Audit Requirements: Small GmbHs are generally not required to appoint an external auditor, though larger GmbHs may be subject to this requirement.
Advantages of GmbH:
• Lower Capital Requirements: With a capital requirement of CHF 20,000, it’s more affordable to start a GmbH compared to an AG.
• Flexibility: The GmbH offers more flexibility in terms of management and operations, especially for smaller businesses.
• Limited Liability: Just like the AG, the owners’ liability is limited to the amount of capital they’ve contributed.
Key Conditions and Formalities:
• Minimum Share Capital: CHF 20,000 (must be fully paid up at the time of registration).
• Shareholders: At least one shareholder (can be an individual or a legal entity). There is no maximum limit on shareholders.
• Managing Director: The GmbH must have at least one managing director (can be a foreigner). The managing director does not need to be a Swiss resident.
• Registered Office: The company must have a physical address in Switzerland.
• Articles of Association: These must be drafted and signed by the founders, outlining the company's structure, purpose, and internal rules.
• Public Registration: The GmbH must be registered with the Swiss Commercial Registry, where it will receive its official legal status.
• Audit Requirements: Small GmbHs are generally not required to appoint an external auditor, though larger GmbHs may be subject to this requirement.
Advantages of GmbH:
• Lower Capital Requirements: With a capital requirement of CHF 20,000, it’s more affordable to start a GmbH compared to an AG.
• Flexibility: The GmbH offers more flexibility in terms of management and operations, especially for smaller businesses.
• Limited Liability: Just like the AG, the owners’ liability is limited to the amount of capital they’ve contributed.
