Company Liquidation in Switzerland

Company Liquidation in Switzerland

Updated on Thursday 18th April 2019

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Company-Liquidation-in-SwitzerlandOpening the liquidation proceedings in Switzerland

The procedure of company liquidation in Switzerland is generally enforced through a resolution of the shareholders’ meeting. In order to commence the liquidation of a Swiss company, it is necessary to have the majority of the votes of the company’s shareholders; this is the general procedure that is applied in this case, unless the company’s statutory documents mention otherwise.

The liquidation of a Swiss legal entity can be concluded in front of a public notary in Switzerland. The notary will issue a document that must be submitted with the Swiss Trade Register and during the proceedings the company can maintain its name with the mention “in liquidation”. Our team of Swiss lawyers can provide legal advice on other legal requirements that must be enforced during the liquidation of a local company

Foreign investors are strongly advised to receive in-depth information on the legislation regulating the liquidation of a local business; our team of lawyers can offer legal assistance on all the types of liquidation procedures that can be concluded in this country.


The voluntary liquidation in Switzerland


The liquidation of a local business is divided under several procedures. Thus, a business can be liquidated on a voluntary or involuntary basis. Other than the shareholders’ meeting, a voluntary liquidation procedure in Switzerland is possible through a court decision when at least 10% of the company’s shareholders have good reasons to request company liquidation.

The liquidation proceedings can be conducted by the company’s directors or by liquidators appointed by the judge. The liquidators or directors must draft a balance sheet and then the creditors are allowed to submit their claims. In the situation in which the business has a high level of debts, the appointed liquidators have to announce the Swiss courts on the matter, which will start the insolvency procedures.

If the company may continue the liquidation process, the liquidators will terminate the activities of the company, will notify on any remaining share capital of the Swiss company and will perform any other obligations. Once the liquidation procedure is terminated, the liquidators will file an application with the Commercial Register for the deletion of the company.

According to the Swiss Law of Obligations, it is very important to make sure the company liquidation procedure does not breach any law, which is why our lawyers in Switzerland can provide you legal assistance throughout the procedure. It is important to know that businessmen who need assistance in liquidation procedures in other European countries – Belgium or Norway for example, may contact our lawyers, who can address the case to our partners in the respective countries.  


Involuntary liquidation in Switzerland


The involuntary liquidation procedure is started regardless of the position of the company’s representatives. The procedure has to be started when a business becomes bankrupt for example, or in the situation in which the company will merge with another corporate entity. When involved in a bankruptcy case, the company’s creditors or the company itself must request the liquidation procedure in front of a local court.
At the same time, a Swiss business may also apply for insolvency proceedings, as prescribed under the Swiss Debt Enforcement and Bankruptcy Law. Regardless of the type of liquidation the company is involved in, the procedure will be represented by an administrator, who will ensure that the liquidation will be concluded following the necessary steps.  
It is important to know that once the company entered the liquidation procedure, it is required to disclose all the company’s assets, while the company’s creditors must present their claims. Within two months the administrator must draft a balance sheet and the distribution of the company’s assets in order to cover the debts
The deletion of the company from the Swiss Trade Register will only take place after all the company’s assets are distributed amongst the creditors; the deletion procedure is conducted by the appointed liquidators, who will submit an application with the Trade Register.  

What are the legal grounds for liquidating a Swiss limited liability company? 

The limited liability company (LLC) in Switzerland is the most common business form that is registered in this country. Thus, we will present below the main reasons for which a limited liability company can be liquidated in this country and our team of Swiss lawyers can advise on the situations mentioned here: 
  • the LLC can be liquidated as per the provisions of the company’s articles of association;
  • through the resolution of the company’s shareholders, provided that the articles of association do not mention any legal grounds concerning the liquidation procedure;
  • through the decision of a local court, when at least 10% of the company’s shareholders have expressed the wish to close the company down for reasonable grounds;
  • the dissolution of a Swiss company can also take place provided that the business has incorporation errors;
  • at the same time, a Swiss business may be dissolved when it develops unlawful activities.


The above mentioned situations are applicable when a company is involved in voluntary liquidation proceedings. It is important to know that, regardless of the company type, the voluntary liquidation is the most cost effective option when having to close down a Swiss company, as long as there are no creditors. 


What are the tax requirements when concluding Swiss liquidation? 

During the liquidation procedure, the company may be able to continue in developing its business activities. This means that the company will still be liable to taxation, and a set of corporate taxes will be applied. Our team of Swiss lawyers can advise on the manner in which corporate taxes will be imposed to local businesses, depending on their legal entity and object of activity, but it is important to know that the following will apply: 
  • corporate income tax – the tax will be applied, but it is necessary to know that holding companies that are involved in a liquidation procedure can be exempted from this tax, when applied at a cantonal level;
  • real estate tax – the tax can be applied for capital gains, as well as for the transfer of real estate;
  • withholding tax – this tax will be imposed at the standard rate of 35%;
  • stamp transfer tax – it can be applied only for the sale of taxable securities;
  • value added tax – the payment of the tax will still remain applicable, provided that the company qualifies for this type of tax. 


What are the main stages of a bankruptcy procedure in Switzerland? 

When a company has to be liquidated due to bankruptcy, a wide set of steps have to be concluded. The proceedings can start through a request of one of the company’s creditors or by the company, which must deposit a declaration of over indebtedness
A bankruptcy administrator will be appointed, who, in a period of 60 days since the claims have been made, has to create a plan concerning the manner in which the company’s assets will be distributed amongst the entitled parties. The administrator has to submit a report on the matter, and file it to the competent court in Switzerland.

Businessmen who have entered liquidation procedures in Switzerland are invited to contact our Swiss lawyers. Our law firm in Switzerland can provide in-depth information on the legislation in the field, as well as legal representation in front of the local courts. You can also contact us for details about the Bankruptcy Law.