The limited liability company (LLC)

It is the most popular legal form in Switzerland: with a GmbH, the personal liability of shareholders can be excluded.

Liability is limited to the share capital.

The GmbH is a company with its own legal personality in which one or more persons join together to form their own company.

Each shareholder is liable up to a maximum of the amount of their share capital.

A minimum capital of CHF 20,000 is required to form a LLC in Switzerland. This capital can be raised in the form of cash or contributions in kind.

The minimum capital serves as security for creditors and demonstrates the financial soundness of the company. In addition, the share capital must be paid up in full before the GmbH can be entered in the commercial register.

The LLC is a flexible legal form that can be used for almost any business purpose. Whether in trade, in the service sector, in production or in the real estate business - the LLC offers a legal structure that is suitable for a wide variety of business models.

The exact purpose of the company is defined in the articles of association and must be entered in the commercial register.

A LLC can be founded by one or more persons. These can be natural persons or legal entities. At least one person must be entered in the commercial register as a managing director.

The shareholders are not personally liable for the debts of the LLC, which makes the LLC particularly attractive for entrepreneurs who want to protect their private assets.

The LLC offers many advantages. One major advantage is the limitation of liability: the shareholders are only liable with their contribution and not with their private assets. This offers a high level of protection in the event of financial difficulties. In addition, the LLC enjoys a high level of acceptance among banks, suppliers and customers, which facilitates business relationships.

The option of investing the share capital in different business areas offers additional flexibility and growth opportunities.

The disadvantages of a LLC include the higher formation costs and the higher administrative costs compared to a sole proprietorship.

The formation requires a notarized articles of association and entry in the commercial register, which entails additional costs. There is also an obligation to keep double-entry accounts and to prepare annual financial statements, which means increased administrative work.

Flexibility in raising capital can also be limited, as changes to the share capital must be notarized and entered in the commercial register.

In summary, the limited liability company in Switzerland offers a solid and flexible corporate structure with numerous advantages, particularly in terms of limited liability and acceptance by business partners. However, it also requires a higher administrative and financial outlay, which should be carefully considered.