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
- 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.
- 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.
- 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.
- 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.
- 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.