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When setting up a company, foreign nationals can select from the available forms
of legal entities. Each of these forms of legal entities has advantages, which can provide your
company with a head start for economic success. Thanks to the low level of interest rates and
non-wage labour costs the costs of production are competitive.
Efficient Legal Procedures
Setting up a Business
Types of legal form of a company
Efficient Legal Procedures
As a general rule, the freedom of trade and industry allows everyone, including foreign nationals, to set up a business in
Switzerland or to hold a financial interest in one. An overseas individual or foreign company may choose the business form
which best meets their needs.
The general regulations on accounting in Switzerland are clear and concise.
In the event of a corporate restructuring, the rules governing employee layoffs and notice periods are relatively uncomplicated.
Setting up a Business
In general, no approval from the authorities, chambers of commerce or professional associations is required to establish a
business. To conduct a business personally on a permanent basis, a work and residence permit is, however, required.
The exercise of certain professions or the establishment of specific businesses may, however, require special licenses or
diplomas. Foreigners who do not have a residence permit may have their business operated by Swiss nationals.
All business sectors are open to foreign investment. It is not necessary that Swiss persons hold a certain percentage of the equity.
Certain restrictions still exist with respect to government monopolies. However, liberalization is in full progress within
the framework of the Bilateral Agreements between Switzerland and the EU for traditional monopolies such as railway and
postal services.
For some professions and for certain businesses, the Federal government or the Cantons impose rules. In such cases,
a special license or permit is needed. This applies to activities for which a recognized diploma is required, such as:
1. Banks, insurance companies and investment brokers
2. Hotels and restaurants (only in certain Cantons)
3. Physicians, dentists, pharmacists and attorneys
4. Certain mercantile and services businesses (e.g. wine merchants, private employment agencies, temporary employment
services)
Types of legal form of a company
Swiss law recognizes the following types of business forms:
1. Partnership or a joint stock company
2. Subsidiary or branch
3. Joint venture (partnership or joint stock company)
4. Strategic alliance with or without an equity investment
The most common forms of domicile for a foreign company in Switzerland are the subsidiary and the branch.
Swiss civil law distinguishes between partnerships and joint stock companies, whereas tax law distinguishes between
various business purposes.
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