Set Up Swiss AG (Public limited company)
In Switzerland, the most favored form for legal activities for companies is known as Swiss “Aktiengesellschaft” or shortened “AG” (in English: “company limited by shares” / “Ltd.”).
Compared to the Swiss “Gesellschaft mit beschränkter Haftung (GmbH)” that is established with a capital of CHF 20K, the shareholders can stay nameless and are not registered in the commercial register as the AG is not as person-oriented as the “GmbH” and the shareholders do not automatically have the ability to control and act on behalf of the company.
The AG may be outlined as a company that has its capital that is distributed into specific shares and whose responsibilities are paid out only from the company gains. The shareholders must only fulfill the tasks outlined in the sections of the organization and are not individually responsible for the commitments of the company. The applicable regulations may be found in art. 620 - 763 of the Swiss Code of Obligations.
The key Features of the AG are as follows:
- A minimum of one founder is necessary. The founding entrepreneurs can either be Switzerland based or non-locals and may have a legal form as well as be an individual.
- The registered money is distributed into parts and must add up to more than CHF 100K of which one-fifth, but more than CHF 50K, should be deposited. It may either be in cash or a deposit in that amount.
- Responsibility is restricted to equity.
- The official and notarial incorporation process is required to establish AG. The AG becomes a corporate body after it completes its registration in the commercial register. – The legal persons of the AG include general meeting as the ultimate governing council, the board of directors as the executive authority and the inspectors, if applicable, as the account-monitoring organ.
- Shareholders are not obliged to participate in AG. Their obligation is restricted to compensation of share capital.
- Every executive director has the right to act on behalf of the company, except if the articles of association specify differently. Individual board members or third parties can be granted to represent in case the board of directors decides so. More than one executive director can act on behalf of the company. What is more, a minimum one resident of Switzerland has to act on behalf of the AG.
- Usually, companies are free to choose any name. The only requirement is the addition of the term "AG” to its name.
- It is necessary for an AG to hold accounts of the company. Double entry accounting with balance records, an operational or gains, and losses account and an inventory is essential.
- A regular review is necessary for a public corporation (mainly if it is recorded in the Stock Exchange) and for a corporation that surpasses two of the following limits in two consecutive fiscal years: total balance sheet of CHF 20M, sales of CHF 40M, and an average of 250 core working stuff over the year.
- Small and medium-sized companies that do not surpass the limits as mentioned earlier are put through restricted scrutiny (inspection). Those companies that have less than ten core working stuff over the year are able to opt out the restricted investigation (examination) totally in case all shareholders approve this process.