Question 1

What does it take to incorporate a public limited company in Switzerland?

Accepted Answer

A public limited company requires a minimum capital of CHF 100'000, of which at least 20% (and in any case no less than CHF 50'000) must be paid in at incorporation. A public notarial deed, articles of association, appointment of the board of directors and entry in the Commercial Register are required. The limited liability company, by contrast, requires a fully paid-in minimum capital of CHF 20'000.

Question 2

Within what time can I challenge a resolution of the general meeting?

Accepted Answer

The time limit is 2 months from the date of the general meeting (art. 706a CO). The action is brought before the District Court (Pretura) or the Court of Appeal depending on the amount in dispute. Those entitled to sue are shareholders who did not approve the resolution, the directors and, in certain cases, the auditors.

Question 3

How does an asset deal differ from a share deal?

Accepted Answer

In a share deal the shares or quotas of the target company are transferred, and with them the entire business, assets and liabilities included. In an asset deal, selected individual assets, contracts or business units are purchased. The share deal is usually faster and tax-neutral for the seller; the asset deal allows unwanted liabilities to be left out but is more complex to structure.

Question 4

When is a director of a public limited company personally liable to the company?

Accepted Answer

Art. 754 CO provides that directors, officers and auditors are liable for the damage they cause to the company through intentional or negligent breach of their duties. The action may be brought by the company, by individual shareholders (for the damage to the company) or by creditors in the event of bankruptcy. The limitation period is 5 years from knowledge of the damage and of the person liable.

Question 5

Are shareholders' agreements valid and binding?

Accepted Answer

Yes. Shareholders' agreements are agreements between shareholders governing votes, pre-emption rights, restrictions on the transfer of shares and the management of the company. They take effect only between the parties and cannot be invoked against the company itself or against third parties who acquire shares in good faith. Breach gives rise to damages, not to the invalidity of acts performed against the agreement.

Question 6

How much does a commercial dispute cost before the District Court of Lugano?

Accepted Answer

Costs depend on the amount in dispute. Swiss court fees range from 0.5% to 5% of the value at stake, on a sliding scale. To these are added lawyers' fees, calculated according to the Ticino cantonal tariff or by agreement. The losing party is normally ordered to pay the fees and to reimburse part of the opposing party's legal costs.

Question 7

How do you protect a business idea from a departing partner?

Accepted Answer

Three tools: 1) a non-disclosure agreement (NDA) signed before sharing information; 2) a shareholders' agreement with a post-exit non-compete clause; 3) registration of trademarks and patents where possible. On their own none of the three is foolproof; together they build a net that makes breaching the agreements far more costly.

Question 8

Does amending the articles of an LLC always require a notary?

Accepted Answer

Yes. Amendments to the articles of a limited liability company, like those of a public limited company, require a public notarial deed and entry in the Commercial Register. The only exception is purely formal adjustments required by law. The firm handles both the members' resolution and the execution of the public deed, sparing the detour through an external notary's office.

Commercial & Corporate Law

Commercial & Corporate Lawyer in Lugano

The applicable legal framework

Which areas do we cover?

Commercial contract disputes

Debt collection and contractual liability

Shareholder disputes and liability of bodies

Share transfers, shareholders' agreements, SPA

Incorporation of public limited companies and LLCs: the in-house notary advantage

How much does commercial law advice cost?

Our approach

Frequently Asked Questions