What is Code of Obligations (CO)?

The Code of Obligations (CO) is a cornerstone of Swiss civil law that governs commercial activities, contractual relationships, and company regulations. For businesses operating or registering in Switzerland, understanding the CO is vital for ensuring compliance with legal standards and maintaining transparent operations.

The Role of the Code of Obligations in Swiss Business Law

The Code of Obligations serves as a comprehensive legal framework that regulates the formation and execution of contracts, company structures, and liabilities. It outlines the rights and responsibilities of businesses, shareholders, employees, and contractual parties.

This legislation is essential for:

• Governing contracts, such as purchase agreements, employment contracts, and lease agreements.
• Establishing and regulating companies, including partnerships, limited liability companies (GmbH), and joint-stock companies (AG).
• Defining obligations related to financial reporting, shareholder meetings, and director responsibilities.

For businesses in Switzerland, the CO ensures clarity and uniformity in legal processes, fostering trust in the country’s highly regarded business environment.

Key Aspects of the Code of Obligations

1. Contracts and Obligations
   The CO provides detailed provisions for creating, interpreting, and enforcing various types of contracts. It emphasizes fairness and accountability in commercial dealings.
2. Company Law
   The CO governs the formation, management, and dissolution of business entities. It includes rules on capital requirements, shareholder rights, and corporate governance.

Understanding the Code of Obligations is essential for businesses navigating Switzerland’s legal and economic landscape. It provides the legal certainty and transparency that underpin the country’s reputation as a hub for international commerce.