Open an Agricultural Business in Switzerland
Open an Agricultural Business in SwitzerlandUpdated on Thursday 04th July 2019
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Due to the climate available in Switzerland, the agricultural sector represents only a small share of the country’s economy. For example, at the level of 2016, the Swiss agriculture accounted for 1% of the country’s gross domestic product. Since the agricultural sector represents a small, yet important economic activity, most of the products (livestock, vegetables, fruits) are sold on the local market, but there are several types of goods that are sold on international markets, a good example being the Swiss cheese.
Businessmen who want to open a company in the Swiss agricultural industry must know that most of the local businesses operate as family enterprises. As a general rule, the Swiss agriculture is represented by crops such as: grapes, apples, potatoes, sugar beets, cereals, dairy products and livestock (such as sheep, horses, cattle, poultry).
The agricultural land that can be used for various types of crops represents approximately 11% from the country’s entire surface, and most of the agricultural activities are developed in the following cantons: Zurich, Aargau, Bern or Vaud. It is also necessary to know that the country’s authorities are allowed to establish fixed prices for specific basic products, such as cereals or milk. Our team of Swiss lawyers can provide legal representation in starting an agricultural business and can offer assistance on the registration procedures available in one of the local cantons.
What are the key aspects of the Swiss agriculture?
Before deciding to enter a specific business sector in Switzerland or elsewhere, investors should first study the current situation of the respective market and its main characteristics, in order to create a realistic business plan. For example, in the last decade, numerous countries across the world began investing in organic farming, and this aspect is also of high importance for the Swiss agriculture; our law firm in Switzerland can provide more information on the legal requirements that must be respected by organic farms. Some of the key aspects of the Swiss agriculture are the following:
- • at the level of 2018, Switzerland had 50,852 farms (7,032 were registered as organic farms);
- • the share of the Swiss organic farms is of 13,8% of the total number of farms;
- • the workforce hired in the Swiss agriculture accounts for 152,442 employees;
- • 14,7% of the Swiss agricultural workers are employed in organic farms;
- • the total surface available for the Swiss agriculture is of 1,044,976 ha;
- • 15,4% of this surface is used for growing organic crops;
- • the average size of a Swiss farm is of 21 ha (for regular crops) and 23 ha (for organic crops);
- • Swiss agriculture also refers to fishing and fish farming and in 2016, Switzerland had 190 such business establishments.
What is the law for Swiss agriculture?
Businesses operating in the Swiss agriculture must comply with the regulations established under the Federal Act on Agriculture. The legislation stipulates that agricultural land must fall under the supervision of the Federal Office for Agriculture. Article 5 of the act stipulates that Swiss farms must be economically sustainable and that their income obtained in a period of seven years must be comparable with the income of other businesses operating in the same region. Other important regulations are presented below:
- • provided that farms do not achieve a financial stability and competitiveness, the Federal Council will take various measures to sustain the development of the farming activities developed by the respective farm;
- • the Federal Council is also the entity that has the right to establish quality measures for the local crops, as well as the methods used for obtaining the respective crops;
- • the act stipulates a set of measures regarding the labeling of the food products, which can be presented be our team of lawyers in Switzerland;
- • the labeling of specific types of products is done on a voluntary basis (as per the Article 14, Section 2) and it can be necessary in specific situations;
- • labeling can be imposed when the Swiss farm used a specific method for obtaining its crops, if the products are grown in the Swiss mountain area or if they are obtained through methods available for sustainable development.
The act also stipulates the measures that must be taken if an agricultural company wants to import food products into Switzerland. For this purpose, it is necessary to obtain an import permit (Article 24). The permit, known as general import permit, is issued upon request by the Federal Office for Agriculture. It is not necessary to pay a fee for the issuance of the import permit and investors are invited to contact our Swiss law firm for in-depth information regarding the documents that must be submitted for obtaining an import permit.