It is known as the center of peace. For centuries, Switzerland has stood out as a beacon of peace in the entire Europe and globally too. This strength in guaranteeing people exemplary peace is also manifested in the business niche. The country has been an attraction to major global multinationals such as the UN that have served as a magnet to top companies. From major banking institutions to services companies, Switzerland is the most preferred for locating the headquarters.
Benefits of forming your company in Switzerland
For an entrepreneur, the main target is rapid growth and high profitability. By picking Switzerland, you are sure of enjoying the following benefits.
- Switzerland has one of the strongest international banking systems: For years, Switzerland has established itself as a preferred financial center coming well ahead of New York, London, and Frankfurt among other top regions. Because of the financial stability, the country has become a beacon of strength because more clients are sure that their assets are safe all the time.
- For more than a century, Switzerland has become a beacon of political stability: This has been evident with progressive peace as other countries tore each other during the WWII and even the Cold War. Because of this stability, investors are sure that their businesses and deposits in banks are subject to very low political risk. It is because of this stability that Swiss Franc plays a crucial role in underwriting enterprises.
- Switzerland has one of state of the art and properly maintained infrastructures in Europe: Whether your business will involve a lot of movement to deliver products and services, or clients have to make a lot of movement, Swiss infrastructure is among the best in Europe. Besides, it is properly connected to the neighboring countries so that communication, movement, and value addition are highly efficient.
- Taxation benefits of Switzerland company formation: If you open a holding company, it will enjoy a great percentage of reduced corporate tax if the enterprise owns more than 20% of the share capital in a different legal, entity. As a signatory to diverse double tax agreements, all companies formed in Switzerland are sure of avoiding double taxation. This helps such companies to retain the bulk of the profits for rapid growth. For example, Tax agreements with European Union Members could even help companies to be exempted from tax on specific considerations such as dividends.
- Because of great ease of doing business in Switzerland, getting expert support is very easy. All the professional services providers and companies moving to Switzerland have created a vibrant business ecosystem, especially for startups. All you need is studying the market before setting off to register and rapidly expanding to the entire Europe.
The main types of companies you can form in Switzerland
To take advantage of this business paradise, investors are required to incorporate companies in Switzerland. The following are the main types of companies you can form in Switzerland.
- Sole proprietorship (single owner company): This is one of the commonest types of companies in Switzerland. It is ideal for firms that offer professional services and small businesses that are seeking to establish their presence in Switzerland and Europe.
- General partnership companies: This is an association of persons who agree to form a commercial business. The company is operated jointly, and one of the partners must be in the company’s name. For example, Eielson and Co. A partnership company does not have capital limitation.
- Limited partnership company: This is the type of company where all the members have unlimited liability. The limited partners can only take liability to an agreed amount.
- Joint-stock company: When a business is considered a separate legal entity, this is the commonest type of formation. Under the formation, one of the directors is required to be a Switzerland resident.
The liability, in this case, is only limited to the company’s assets. However, the minimum shareholder’s equity is limited to CHF 100,000 (CFH 50,000 must be cleared/paid). The company is required to follow the common procedures with the registration taking between 2-5 weeks.
- Limited Liability Company: This is a common legal entity because of its wide mandate. It has a minimum shareholder’s equity requirement of CFH 20,000 (CFH 10,000 must be fully cleared). One of the directors authorized to run operations and sign on behalf of the company is required to be a Switzerland resident.
In a limited liability company, all the members are expected to participate in representation and management of the enterprise. However, the company is also allowed to source for nonmembers to transact daily operations. This opens the doors for outsourcing expert managerial services.
It is important to point that shareholders of a limited liability company are listed publicly in the commercial register at the Chamber of Commerce and Industry. Besides, the members are jointly liable for all company’s debts to the full registered amount.
- A subsidiary and branch company: This is an independent company formed in Switzerland but affiliated to a mother company back at home. Once the branch is opened, it operates more like a Swiss company than a subsidiary office. However, the company cannot operate fully independently without liaising with the mother company.
A branch office, unlike a subsidiary, is considered a complete independent wing of a mother company located outside Switzerland. The branch has to maintain books of accounts and submit tax returns to the local authorities. The mother company takes full liability for the branch debts and decisions. Note that a Swiss resident is required to have your branch company registered in Switzerland.
How to register a company in Switzerland ?
The process of company registration in Switzerland is relatively easy. If you have all the documentation done well and clear the requisite fee, the company could be registered in 3-5 days. Here is the procedure for registering a company;
- Identify the right name of the company: Before the business incorporation process can commence, the Chamber of Commerce and Industry requires the investors to pick the right name. This is done by carrying an online search in the company’s register to avoid picking a name that has already been taken.
- You must publish a public notice to notify the people to authenticate the signatures of shareholders and articles of association.
- Fill a stampa Declaration Form and the Lex Friedrich Declaration form: These are mandatory declarations that allow foreigners to acquire real estates. This widens the tentacles of your company operations by opening new avenues of investment.
- The company founders must prepare and present the following documents to the commercial register;
- The article of association detailing the company’s operations and relationship with the shareholders
- The managing board members’ specimen signatures
- A registered office of the new company
- A proper business structure with a clear objective for its formation in the country
- Stampa Declaration and Lex Friedrich declaration forms
- Additional documentation as may be required depending on the nature of the company being formed.
Once all the documentation is done well and presented to the right offices, your Swiss Company’s certificate of incorporation can be ready in 3 to 5 business days.
If your Switzerland company formation was targeted for tax reasons, it is important to make another application with Federal Tax Administration. Besides, your company might require additional licenses depending on the specific niche of operations. For example, if your company is offering services or products in areas of occupational safety, telecoms, energy, medical, and legal services, additional permits will be required. Make sure to follow your business line of operation in Switzerland to establish additional requirements before commencing operations.
Why you should consider using expert services when registering a company in Switzerland
If you are planning to enter Switzerland for the first time to register and run a company, it pays to have an expert by your side. Because of the historical stability and good progress by companies that started in Switzerland, the market is highly competitive. By selecting and working with an expert firm, your company will easily internalize all the requirements for faster registration.
Expert company registration agents carry progressive market assessments so that new companies can simply pick the results and make the right decisions. Good company formation experts such as ACC do not simply look at those intending to form companies in Switzerland as clients, but important partners who want support to grow rapidly beyond the borders. Make sure to carefully select the expert firm to get the assurance of assistance during company registration, opening a bank account and initial establishment.
A closer look at the Swiss economy
The Swiss Economy is among the most stable economies in the world. The policy of political stability and monetary security has won Switzerland a haven for investors who want to grow rapidly. The economy follows a common Frist World model where a very small minority is involved in agriculture while the bigger percentage is largely in manufacturing.
The country’s GDP is CFH 647 billion with a $0.5 trillion PPC according to the latest 2019 statistics. Its GDP growth according to 2014 report was 1.8% while GDP per capita in 2016 was $30,000 PPP.
Depending on your niche of operation, Switzerland presents a huge potential for establishment and growth. Note that the country’s administration works very hard to ensure that all institutions work properly and can be relied on for correct business prediction, entry, and rapid growth.