Founding Branch Offices in Switzerland – Legal Forms Permitted
A ’Swiss Branch’ can be founded by both domestic and foreign companies. While the most common legal forms of the head office include an AG (PLC), GmbH (Ltd), or a cooperative, other legal forms are also permitted when founding a branch. This article will explore the various legal forms and requirements for establishing a branch office in Switzerland.
What is a Swiss Branch Office?
A branch office is a commercial operation that, from a legal perspective, is a dependent part of a main office. It allows the principal company to extend its business activities to locations other than the main office. Swiss companies can set up branch offices both within Switzerland and abroad, while foreign companies can establish branch offices in Switzerland.
Legal Forms for Swiss Head Offices
The head office’s legal form is generally one of the following:
- AG (PLC): Public Limited Company
- GmbH (Ltd): Limited Liability Company
- Cooperative
These forms are outlined in the Swiss Code of Obligations (OR):
- Art. 641 OR: Pertains to Public Limited Companies (AG)
- Art. 778a OR: Pertains to Limited Liability Companies (GmbH)
- Art. 836 OR: Pertains to Cooperatives
Permitted Legal Forms for Branch Offices
In practice, branch offices can be founded under various legal forms, provided that the main office is a commercial company in the sense of Art. 934 OR. This includes:
- Commercial General Partnerships
- Limited Partnerships
It is important to note that branch offices are excluded for:
- Simple Partnerships
- Non-commercial General and Limited Partnerships
These restrictions ensure that the branch office operates within the framework of a recognized commercial entity.
Requirements for Domestic Companies
For Swiss companies setting up branch offices within Switzerland or abroad, the following general requirements must be met:
- Legal Form: The head office should be an AG, GmbH, or a cooperative.
- Commercial Operations: The branch office must engage in similar commercial activities as the main office.
- Registration: The branch must be registered in the Swiss commercial register.
Requirements for Foreign Companies
Foreign companies can establish branch offices in Switzerland under the following conditions:
- Compliance with Swiss Law: Branch offices of foreign companies are subject to Swiss law (Art. 160 Para. 1 IPRG – Private International Law).
- Legal Permissibility: The foreign legal system must permit the establishment of branch offices within its own country.
- Registration and Compliance: The foreign company must comply with Swiss registration and operational requirements.
If the foreign legal system allows for the establishment of a branch in its own country, companies can generally also establish a branch office in Switzerland.
Steps to Establish a Branch Office in Switzerland
- Preparation of Documents: Gather all necessary documents, including proof of the legal form of the head office and the registration documents.
- Registration: Register the branch office in the Swiss commercial register.
- Appointment of Representatives: Designate individuals with signing authority who are domiciled in Switzerland.
- Compliance with Swiss Regulations: Ensure the branch office complies with Swiss legal and operational standards.
Benefits of Establishing a Branch Office in Switzerland
- Market Expansion: A branch office allows companies to expand their market reach within Switzerland and internationally.
- Legal and Economic Stability: Switzerland offers a stable legal and economic environment, which is beneficial for business operations.
- Access to European Markets: A Swiss branch office can serve as a gateway to European markets, leveraging Switzerland’s strategic location and trade agreements.
Conclusion
Founding a branch office in Switzerland offers numerous advantages for both domestic and foreign companies. By understanding the legal forms permitted and complying with Swiss regulations, companies can successfully extend their operations and tap into new markets. Whether you are a Swiss company looking to expand or a foreign company seeking to establish a presence in Switzerland, following the correct procedures and leveraging professional support can ensure a smooth and efficient setup process.
