New legal requirements for Swiss PLC’s, Ltd Companies and Associations from the 1st of July 2015 – GAFI
In order to combat money laundering and financing of terrorism, the recommendations of the Groupe d’action financière (GAFI) or Financial Action Task Force (FATF) were revised in 2012. The National Council and Council of States quickly incorporated these recommendations into national legislation.
The national act to implement the revised 2012 recommendations of the Groupe d’action financière (GAFI Act) partly came into effect on the 1st of July 2015. The new legal requirements only apply to privately owned Swiss companies and their shareholders. Publicly listed companies are, therefore, not affected by the new requirements.
Reporting obligation for bearer shares
A reporting obligation for bearer shares has been newly introduced in Article 697i of the “Obligationenrecht (OR)” or Code of Obligations. Anyone buying bearer shares not quoted on the stock exchange must register their personal details with the company within a month. They must also identify themselves to the company. There are no limitations to this requirement, which applies from the purchase of a single bearer share.
The company must now maintain a directory of owners of bearer shares, including the personal details of the owners of the shares. Failure to comply with the reporting obligation, means the rights of membership and property rights are suspended. In addition, failure to comply also has criminal implications. So anyone who intentionally fails to comply with the reporting obligation, or does not maintain the register of shares correctly, will be punished with a fine. These measures mean the bearer share effectively becomes a registered share.
Anyone already in possession of bearer shares must also comply with the reporting obligation. The deadline is the 1st of January 2016.
Beneficial owner’s reporting obligation
If an individual purchases 25% or more of the shares in a private Swiss PLC, this buyer must also state the personal details of the person (beneficial owner) for whom he is ultimately acting (also applies to bearer shares and registered shares). The information must be reported within a month of the transaction in question.
New domicile obligation
A member of the management board or a Company Director must now be resident in Switzerland. This person must have access to the share register or the directory of bearer shares.
There is also a new regulation with regard to limited companies, whereby the beneficial owner with a share of over 25% of the ordinary shares must be identified. The authorised signatory must now also be the Managing Director or a Company Director.
There is a transitional period of two years for adaptation to the statutes. The official media release is available here.
