Switzerland, from a business point of view, has a liberal economic system, political stability, low levels of taxation, flexible labor laws and high availability of qualified employees. Entrepreneurs are motivated due to this advantage and look forward to kick-start their venture in Switzerland. When compared to other countries, starting a business in Switzerland is relatively uncomplicated in terms of bureaucracy and red tape. As a result, an individual has many options when it comes to choosing a legal entity and most importantly a detailed structure for the company.
And in some cases, if a business wants to expand its product or services in Switzerland, they can do so by establishing a branch of their company in this country. A branch office is not an individual company which means that the foreign parent company bears the financial responsibility for it. However, since a branch office is subject to Swiss law, it is treated as a Swiss company.
Advantages of a Branch Office in Switzerland
- No minimum share capital requirement
- Low tax burden
- Exemption from the 35% withholding tax on payments to the parent company
- Exemption of the Swiss profits in the hands of the parent company
- Fewer obligations to present accounts than with other business entities
How to Establish a Branch Office in Switzerland?
A Swiss branch does not have a separate legal personality but still has to be registered with the Swiss company register. And unlike a subsidiary, a branch is easy to incorporate and does not require an individual to undergo many steps. The process to establish a branch of a foreign company in Switzerland is as follows:
- The branch office of a foreign company is limited in the choice of its corporate name. The name of the branch office must indicate:
- The name of the company
- The place of the principal business office and the place of the branch office
- An expressed designation of the branch office as such
- The next step is to notify the nature of the business or the business purpose of the foreign company
- Next, the Swiss branch office must have one or several signatories authorized to act on behalf of the Swiss branch office. In Switzerland, if a foreign company establishes its branch, they must first register their company in the Commercial Register and also specify that the authorized signatories may only act on behalf of the branch office, not on behalf of the principal office of the foreign company. At least one person – or two persons with joint signatory authority who must be residing in Switzerland and must be recorded in the competent Commercial Register as being authorized to act on behalf of the foreign branch office
- The foreign corporation may enact additional rules applicable only to the branch office. Under certain circumstances, these rules are recorded in the Commercial Register
Documents Required to Establish a Branch Office in Switzerland
- A copy of the Articles of Association of the foreign company
- An extract of the branch office registration in the Company Register
- Public registration of the parent company’s shareholders – listed with first name, surname, nationality and place of residence
- Appointment of managing director(s) – at least one must be a Swiss domicile and hold either a Swiss or EU passport
- A certified signature specimen of any signatory of the branch
- The original minutes of the meeting through which a branch office establishment was decided
- A certified copy of the parent company’s Certificate of Incumbency
All required documentation must be notarized, apostilled and translated into the official language of the canton. Many Commercial Registers accept English translations, although this is dependent on experience.
Business Setup Worldwide is a platform to help you start a business in Switzerland. We provide a one-stop solution for all the company incorporation queries. Our team in Switzerland is well-versed with the legal framework and will ensure that the incorporation process of your branch office in Switzerland is efficiently managed from the start to the finish. Contact us today.