Eternity Law International — News — Peculiarities of the enterprise registration procedure in Switzerland: potential challenges

Peculiarities of the enterprise registration procedure in Switzerland: potential challenges

Published:
October 19, 2024

Switzerland is widely known for its stability, strong economy, making it a popular choice for businesses and international companies. However, setting up a business in Switzerland interests navigating a unique lawful framework. This article explores the peculiarities of the enterprise signup process in Switzerland, focusing on potential challenges and offering insights into overcoming them. 

1. Costs of Setting-Up a Company in Switzerland

One of the key factors to consider when setting-up a company in Swiss is the cost, which can be considerably higher compared to other EU states. The initial monetary cost involves several aspects:

Capital Requirements: 

For a Sole Proprietorship (Einzelunternehmen), no minimum finances is demanded, making it the most accessible option for small enterprises and freelancers.

For a Limited Liability Company (GmbH), a minimum funds of CHF 20,000 is demanded, while for a Corporation (AG), the requirement increases to CHF 100,000, with at least CHF 50,000 being paid up at the time of registration.

Administrative Fees:

The roll fee for an AG or GmbH includes fees for notaries, commercial register entries, and business licenses. If legal advice is required, additional costs will be suffered.

Legal and Advisory Costs:

Engaging a permitted advisor, accountant, or consultant is often necessary due to the complex adjustment framework.

Operational Costs:

  • Beyond roll , enterprises must factor in costs like office rent, employee wages (Country has one of the highest labor costs globally), and insurance premiums. These operational expenses can vary significantly based on location and industry.
  • Challenge: The high costs may be prohibitive for small business-mens or startups. To mitigate these challenges, businesses should carefully plan their budgets, explore financing options, or consider forming strategic partnerships to share the costs.

Businesses for sale

BROKER LICENSE IN SWITZERLAND

Europe, Switzerland Forex brokers
The best quality of services provided by the bank for customers and honestly deserved professional reputation belong to Swiss banks. Users of the Forex trading market freely withdraw money through banks of the country, which 10 years ago used an official license. Accordingly, there was no control of brokerage companies and commercial protection of users…

Asset management company with bank accounts in Switzerland for sale

Europe, Switzerland Asset management license
Switzerland asset management company Swiss asset management company has put up a 20 percent stake for sale The company with one of the biggest banks in Switzerland in the digital asset space as a Client, 30+ Clients, proprietary trading platform with one of the most-competitive pricings in Europe; The asset management company was incorporated in…

Company in Switzerland for sale with crypto license

Europe, Switzerland Crypto licenses for sale
Company in Switzerland for sale with the crypto license: details Est. 1973 Domicile: Zug, Switzerland Company: Licensing Swiss AG (para-banking license, in good standing) Platform user functions: The platform is already integrated with crypto buy/sell/receive/send for BTC, ETH, USDT, USDC, VET, SHIB, ADA, XRP, DOGE, RLX, and EOS. Other cryptocurrencies can be added as well,…

2. Sole Proprietorship, or Corporation: Which Legal Form Suits My Company?

Choosing the right permitted form is a crucial decision in the firm roll process. Country offers several legal structures, each with different implications for liability, taxation, and administrative complexity.

Sole Proprietorship:

  • Ideal for individuals or small enterprises.
  • No initial finances requirement.
  • The owner has unlimited liability, meaning personal assets are at risk in the case of financial difficulties.

GmbH:

  • Suitable for small to medium-sized enterprises.
  • Requires a min fund of CHF 20,000.
  • The liability is limited to the company’s assets, protecting personal wealth.
  • Relatively simpler in terms of administration compared to corporations.

AG (Corporation):

  • Favored by larger enterprises or companies looking for transnational expansion.
  • Requires CHF 100,000 in share capital, with at least CHF 50,000 paid up upon registration.
  • Liability is limited to the company’s assets.
  • More attractive for investors due to flexibility in issuing shares.
  • Challenge: Choosing the wrong legal form can lead to tax inefficiencies and increased liability. Business owners should seek expert permitted advice to choose the structure that best suits their long-term goals, operational scale, and risk tolerance.

3. Steps to Setting-Up a Company in Switzerland

The registration method in country is systematic and involves several critical steps:

Decide on a Legal Structure:

  • As mentioned earlier, choose between sole proprietorship, GmbH, or AG based on your business’s goals.

Prepare a Business Plan:

  • This is particularly important for securing financing from Swiss banks or investors.

Register the Business Name:

  • The business name must be unique and can be checked against the commercial register (Zentraler Firmenindex – ZEFIX). For AG and GmbH, the business name must indicate the legal form.

Draft the Articles of Association:

  • These outline the purpose of the business, the structure of the firm, and operational rules.

Deposit Initial Funds:

  • Open a funds assurance account and transfer the needed initial capital (for GmbH or AG).

Notarize the Articles of Association:

  • Notary involvement is mandatory for AG and GmbH rosters. The Articles must be officially notarized before proceeding.

Enroll with the Commercial Register:

  • Submit the notarized documents to the Cantonal Commercial Enroll. This typically takes about 2-4 weeks.

Tax Registration:

  • Once registered, your enterprise must register with the Federal Tax Administration for VAT and corporate tax purposes.

Apply for Social Security:

  • Register with the social security office (AHV/IV) to cover employees.
  • Challenge: Navigating the bureaucracy can be time-consuming, especially for foreigners unfamiliar with Swiss adjustment practices. Entrepreneurs can save time and avoid mistakes by hiring local advisors familiar with cantonal regulations.

4. Checklist for Setting-Up a Company in Swiss

A structured approach ensures that no critical steps are overlooked. Here’s a checklist to guide you through the procedures:

  • Choose the appropriate legal structure (Sole Proprietorship, GmbH, or AG).
  • Draft a comprehensive business plan.
  • Secure the required capital.
  • Check the availability of your business name.
  • Draft and notarize the Articles of Association.
  • Open a Swiss bank account and deposit the minimum fund.
  • Enlist with the Commercial Register.
  • Apply for VAT and tax registration.
  • Enlist with social security authorities.
  • Obtain any industry-specific licenses or permits.
  • Review and comply with local labor laws (employment contracts, minimum wage).
  • Having this checklist ensures you cover all permitted and administrative bases.

5. Time Frame for Setting-Up a Company

The time it takes to enroll a establishment in Country can vary based on the complexity of the business-company and the permitted structure chosen:

  • Sole Proprietorship: The registration process is relatively quick and can be completed within a few days to a week.
  • GmbH or AG: The process typically takes 3 to 6 weeks, including the time for notarizing papers and registration with the commercial enroll.
  • Challenge: The time can be extended if documentation is incomplete or incorrect. Hiring a permitted advisor or local consultancy firm helps ensure the process runs smoothly without delays.

6. Further Considerations for Setting-Up a Company

  • Banking and Financing: Swiss banks have strict due diligence procedures, especially for international clients. Creating a business bank account might require extensive documentation, including proof of beneficial ownership and the source of funds.
  • Work Permits: Non-citizen nationals wishing to establish a company in Swiss must acquire a residency and work permit. This adds another layer of complexity, as permits are subject to quotas and specific conditions.
  • Taxes and Social Security: Corporate tax rates vary by canton and municipality, ranging from 11.9% to 21%. Additionally, firms must contribute to social security for their employees, which includes pension funds, accident insurance, and unemployment advantages.

7. Challenges and Solutions When Setting-Up a Company in Switzerland

While Country offers a robust business environment, several challenges may arise during the registration process:

  • High Costs: Switzerland is known for its high costs, from capital requirements to labor and operational expenses.
  • Solution: Develop a comprehensive financial plan and explore local funding or investment opportunities to manage expenses effectively.
  • Complex Bureaucracy: The Swiss regulatory framework, with its multiple layers and cantonal differences, can be confusing for non-residents.
  • Solution: Work with local legal experts who are familiar with the specific regulations and processes in different cantons to ensure compliance.
  • Foreign Ownership Restrictions: Non-Swiss residents may encounter additional scrutiny or restrictions, especially related to visas and banking.
  • Solution: Collaborate closely with Swiss authorities to meet all legal and residency requirements, ensuring a smooth establishment process.
  • Time Delays: Swiss bureaucracy can cause delays in registration and approval processes.
  • Solution: Ensure all documentation is accurately prepared and submitted on time, and consider engaging local agents or services to speed up the process where possible.

In conclusion, while Switzerland offers a favorable environment for firms due to its economic stability, infrastructure, and strong economy, entrepreneurs should be prepared for a challenging registration process. Understanding the financial requirements, choosing the right legal structure, and navigating the regulatory landscape are critical to successfully establishing a company. By anticipating these challenges and applying practical solutions, businesses can make the most of the opportunities Switzerland offers.

You could be interested

Crypto exchange in Nigeria

In May 2022, Nigeria officially adopted a law on the regulation of cryptographic means. Today, registration of a structure such as crypto exchange in Nigeria is a new phenomenon for business owners, however, this allows local regulators to fully license this activity, and allows companies to operate in accordance with certain laws and regulations. Below,...

Jurisdictions for ICO

The best jurisdictions for ICO are Malta, Switzerland and Singapore. To attract investment and venture capital investments today, one of the most profitable and effective methods is ICO. For anyone who plans to implement this technology for their business or organization, they must have complete information regarding jurisdiction and other aspects for the successful implementation...

Investment fund in Portugal

Structures such as Portugal investment funds are financial companies whose main goal is to increase investors’ capital. In this jurisdiction, their activities are regulated by the Securities Market Commission (CMVM). The minimum investment amount to participate in the commercial program for obtaining a residence permit in Portugal is 500,000 euros. In 2021, the minimum amount...

ISO 50001: Energy Management

Energy consumption is a key metric for companies. Energy savings mean lower operating costs. Energy consumption also means reducing emissions and taking greater care of natural resources. These actions are highly significant for organizations seeking to follow and promote environmental management. Energy-intensive industries and other industries can significantly improve the energy efficiency of energy consumers...

Differences between the AG and the GmbH companies

We propose to consider these two terms in detail What Is Aktiengesellschaft (AG)? AG is a shortening of Aktiengesellschaft. It is a German expression for a company restricted by share possession whose offers might be exchanged on a financial exchange. The term is utilized in Germany, Austria, Switzerland and South Tyrol for organizations joined there....

The best electronic wallet

The best electronic wallet is quite a debatable issue in 2020. There are plenty of various options available on Internet sites, but there are not so many services worthy of attention in terms of total conditions. The issue of election can be solved as follows: Finding an e-wallet by trial, but it is fraught with...

Discover our services

The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.

Ready-made companies for sale

Companies with a bank account around the world

Banks for sale

Established Banks for sale

Ready-made licenses for sale

Forex, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Licensing

Forex licenses, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Offshore company registration

Expert advice on the acquisition of an offshore company

Open a bank account

Open bank accounts in more than 120 banks around the world
Fill the blank:

Zurich

Dreikonigstrasse, 31A, Stockerhof
+41 435 50 73 23

Kyiv

Baseina street, 7
+38 094 712 03 54

London

Grosvenor Gardens, 52
+44 203 868 34 37

Washington

1629 K St. Suite 300 N.W.
+1 (888) 647 05 40 Toll Free

Vilnius

Gediminas Avenue, 44A
+370 52 11 14 32

Tallinn

Kesklinna linnaosa, Tuukri 19
+372 880 41 85

Edinburgh

Lochrin Square, 1
+44 203 868 34 37

Nicosia

Jacovides Tower, 5 floor
+371 665 550 51

Riga

Esplanade, 7 floor
+371 665 550 51

Hong Kong

18 Harbour Road, 35/F, Central Plaza, Wanchai
800938622 Toll Free

Singapore

Level 42, Suntec Tower Three, 8 Temasek Boulevard
+6531594300

Sydney

20 Martin Place
+61 2 888 00 365

Porto

2609 Avenida da Boavista
+351 800 500 206 Toll Free

Tbilisi

Revaz Tabukashvili Str., N 45, area N 7
+995706070360