Overview of Legal Structures

Sole Proprietorship

Kollektivgesellschaft

(general partnership)

Kommanditgesellschaft

( limited partnership)

Gesellschaft mit beschränkter Haftung (GmbH)

(roughly equivalent to:

limited liability company)

Legislative basis

Not regulated separately in the Swiss CO

CO 552–593

CO 594–619

CO 772–827

Main use

Small firms, activities carried out by

individuals (e.g. artists)

Small, permanent businesses centering on specific individuals

Special cases, e.g. small businesses that

carry out activities which are strongly

individual-centered, with involvement of

external investors 

Small, individual-centered businesses

Legal status

Sole property of the firm’s owner

Partnership

Partnership

Legal entity, incorporated body

Composition of the company name

General restriction:

legislation prohibits misrepresentation and

protects public interest

CO 944

 Family name of proprietor with or without first name CO 944, 945

Permissible additions: business activity, fantasy designations.

Family name of at least one partner with a suffix indicating the corporate relationship of the partners, or the family names of all partners. May not include any other name than that/those of the partner/s.

CO 947 I, II, IV

Permissible additions:

business activity, fantasy designations.

CO 944

Family name of at least 1 partner with unlimited

liability (general partner) with a suffix indicating the corporate relationship.

May not include any other name than that of the partner with unlimited liability.

CO 947 III, IV.

Limited partner may not be named; otherwise the liability of the limited partner becomes unlimited.

CO 607

Permissible additions:

business activity, fantasy designations.

CO 944

Free choice (personal names, activity, fantasy

designations) provided the name is still available.

The legal form must be indicated in the company’s name.

CO 944, 950

Formation through

business carried out in a commercial manner

Self-employment, economic activity as a

means of permanent gainful employment. 

Signing of articles of partnership CO 552,

informal, i.e. a general partnership can be created without any written agreement.

If no commercial activity is pursued the partnership becomes a legal entity only when it

is registered in the CR.

CO 553

Signing of articles of partnership, informal,

i.e. a limited partnership can be established

without any written agreement.

CO 594

If no commercial activity is pursued the

partnership becomes a legal entity only when

it is registered in CR.

CO 595

Public act of signing when the company is

founded, adoption of articles of incorporation/association,

appointment of a board

of management and representatives and

(provided such are not dispensed with pursuant

to CO 727 a II) the auditors.

Registration in CR.

CO 777–779

Registration in CR (commercial register)

Compulsory for businesses pursuing

commercial aims that achieve an annual

turnover of minimum

CHF 100 000

OCR 36

Compulsory for businesses pursuing

commercial aims

CO 552 II

Compulsory for businesses pursuing

commercial aims

CO 594 III

Becomes a legal entity only once it is registered

in the CR.

CO 779

Number of partners or members

1 natural person is the sole proprietor 

2 or more natural persons become partners

CO 552

At least one natural person with unlimited

liability (general partner) and at least one natural person, legal entity or corporation that is a limited liability partner

(limited partner)

CO 594 

At least one shareholder

Shareholders may be natural persons, legal

entities or corporations

CO 775

Capital required

No stipulations 

No stipulations

Amount and partners’ share as per contract

CO 557 and/or 531

No stipulations.

Amount and partners’ share as per contract

CO 598 and/or 557

The partner’s contribution of each limited

partner must be registered in the CR

CO 608, 609 and OCR 41 para.2 lit g

Obligatory nominal capital, the level is de-

fined in the articles of association, divided

into capital shares each with a nominal

value of at least CHF 100

CO 774

Minimum: CHF 20 000. Each capital share

must be fully paid up

CO 777c I

In-kind payments

Permitted

Permitted

CO 557/531

Permitted

CO 598 and/or 557, 531

Permitted, special procedure

C0 777 II in conj. with 628 and 634

Organization and executive bodies

No executive bodies

Trustees/auditors may be appointed

Partners

Auditors may be appointed

Partners

Auditors may be appointed

– General meeting of    members

– Management board  (minimum 1 member)

– Auditors if not  dispensed with

CO 727a II

CO 809 et seq.

Liability/further contributions

subsidiary = complementary to company capital if this is exhausted

Unlimited liability of the proprietor with personal

assets. 

Primary liability to the level of company

capital

Subsidiary joint and several unlimited

liability of each partner with personal assets

CO 568

Primary liability to the level of company

capital.

Subsidiary joint and several unlimited liability

of each general partner with personal assets

CO 604

Subsidiary joint and several limited liability

of each limited partner (liability limited

to level of partnership capital)

CO 608

Liability limited exclusively to the company’s

assets.

CO 794

Optional limited liability to make further

contributions according to the articles

of association.

Further contributions linked to each capital

share that must be paid up are determined

in the articles of association and may

not exceed twice the nominal value of the

capital share.

Liability only for further contributions linked

to own capital share

CO 795

Growth using external capital/investors

Not suitable 

Admission of new partners

CO 569

Admission of new general or limited partners

CO 612

Increase of company capital by modifying

articles of association

CO 781

Use of profit and bearing losses

The proprietor alone. 

As stipulated in the articles of partnership.

CO 559 et seq.

As stipulated in the articles of partnership

CO 601

Shareholders are entitled to share of balance

sheet profits as stipulated by law and in the articles of association

CO 798, 801 in conjunction with 660

Compulsory accounting requirement 

If the firm is obliged to register in the CR

CO 957, OCR 36

If the partnership must be registered in the CR

CO 957–964

If the partnership must be registered in the CR

CO 957–964

Yes

CO 957–964

Taxation

Proprietor for entire income and assets from business and private sector. 

Each partner for share of income and assets

derived from the partnership as well as for

private income and assets 

Each partner for share of income and assets

derived from the partnership as well as for

private income and assets 

Company for profit and capital

Shareholders for capital share as assets and

profit distributions as income 

Costs for setting up a company

(consultation, founding, notary, registration in the commercial register) 

CHF 500 to 2500

CHF 2500 to 5500

CHF 2500 to 5500

From CHF 3000

Company management and representation

By the proprietor and individuals he/she

may appoint 

By each partner in his/her own right, unless

determined otherwise in a partnership resolution.

However, at least 1 partner must be authorized as a representative

Other authorized signatories according to

partnership resolution

CO 563, 566

By each general partner in his/her own right,

unless determined otherwise in a partnership

resolution.

However, at least 1 general partner must

be authorized as a representative

The limited partner has neither the right nor

the duty of management

CO 600 I

Other authorized signatories according to

partnership resolution

CO 599, 603/563

Responsibility for management shared

collectively by all shareholders unless

determined otherwise in the articles of

association

CO 809

Each manager is authorized to represent the company

Other stipulations may be made in deviation of this in the articles of association; however

at least one executive manager must be appointed to represent the company

CO 814 et seq. 

Transfer of membership

(exit, employee shares etc.)

No membership, full or partial sale of business

operations

Pursuant to the partnership agreement

(CO 557 I); if there are no provisions in the partnership agreement, then with the approval of all partners (CO 557 II

with reference to CO 542)

Pursuant to the partnership agreement

(CO 598 I); if there are no provisions in the partnership agreement, then with the approval of all partners. (CO 598 I with reference to CO 557 and 542)

Transfer of capital shares by way of written notice.

OR 785

Approval of the annual general meeting of

shareholders (at least two-thirds of all represented votes and the absolute majority of

the total company capital with voting rights)

unless determined otherwise in the articles

of association.

CO 786, 808b I subpara.4

Nationality and residency Residence and work permit

The proprietor does not have to be domiciled

in Switzerland 

The partners do not have to be domiciled in

Switzerland 

The partners do not have to be domiciled in

Switzerland 

The company must be represented by one

person domiciled in Switzerland

CO 814 III