What is Limited company?

A limited company, referred to as a Gesellschaft mit beschränkter Haftung (GmbH) in German or société à responsabilité limitée (SARL) in French, is a legal business structure commonly used in Switzerland. This form of company combines elements of a partnership and a corporation, offering flexibility and limited liability protection for its owners.

Key Features of a Limited Company in Switzerland

  1. Legal Entity
    • A limited company is a separate legal entity, meaning it has its own rights and obligations independent of its owners. It can own assets, enter into contracts, and be held liable for its obligations.
  2. Limited Liability
    • The liability of the shareholders is restricted to the amount of their capital contributions. Personal assets of the shareholders are protected from the company’s debts.
  3. Share Capital Requirements
    • A GmbH requires a minimum share capital of CHF 20,000, fully paid up at the time of registration. Shares can be divided among multiple shareholders.
  4. Management
    • The company can be managed by one or more directors, who may also be shareholders. At least one director must be a Swiss resident.
  5. Registration
    • A limited company must be registered in the Swiss Commercial Register, and its Articles of Association must outline its purpose, structure, and governance.

Benefits of a Limited Company

  • Liability Protection: Shareholders’ personal assets are shielded from business liabilities.
  • Flexibility: Suitable for small and medium-sized enterprises (SMEs) with the potential to grow.
  • Credibility: The formal structure enhances trust and reliability with clients and partners.

A limited company is one of the most popular business forms in Switzerland, offering a balance of security, flexibility, and scalability for entrepreneurs and businesses. It provides a solid foundation for conducting business in Switzerland’s competitive and stable economic environment.