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Permits & Relocation

Can Foreigners Start a Company in Switzerland? Rules for Foreign Founders

Foreigners can own Swiss companies, but someone must live in Switzerland to represent them, and working here needs a permit. Here is how the rules differ for EU and non-EU founders.

By Amos Hope Jnr · · 4 min read

Illustration of a suitcase, a passport and papers on a station platform under a departures board, with mountains behind

Switzerland attracts entrepreneurs from all over the world, and there is no rule that a Swiss company must be owned by Swiss citizens. A foreigner, or a foreign company, can hold 100% of the shares of a Swiss GmbH or AG.

But owning a company and working in Switzerland are two different things. This guide explains the two rules that matter most: the Swiss resident representative and the work and residence permit.

Rule 1: someone must live in Switzerland

Swiss company law requires that every GmbH and AG can be represented by at least one person who lives in Switzerland. This person must be authorised to sign for the company, usually as a managing director or board member, and must have access to the company's share register and register of beneficial owners.

In practice, founders who live abroad have three options:

  1. Move to Switzerland themselves and take the role.
  2. Appoint a partner or employee who lives in Switzerland.
  3. Use a professional director service, offered by some fiduciaries and law firms for a fee. Because this person carries legal responsibility, they will want to understand and supervise the business.

A sole proprietorship works differently: the owner always needs a Swiss residence and work permit.

Rule 2: working in Switzerland needs a permit

If you want to live and work in Switzerland, including in your own company, you need the right permit. The rules depend mainly on your nationality.

EU and EFTA citizens

Citizens of the European Union and EFTA countries benefit from the Agreement on the Free Movement of Persons. According to the federal KMU portal, they can set up a business in Switzerland and become self-employed with a B permit, which for self-employed people is first issued for five years.

When registering, you must show that you really are self-employed. Accepted evidence includes a commercial register entry, a VAT number, registration with social insurance as self-employed, a business plan or accounting figures.

If you work as an employee of your own GmbH or AG, you register like any employee with a Swiss employment contract.

Citizens of other countries ("third states")

For citizens of countries outside the EU and EFTA, the rules are much stricter. Unless they already hold a C permit or are married to a Swiss citizen or C permit holder, they have no legal right to self-employment. They must apply to the cantonal authority, which checks whether the business will have a lasting positive effect on the Swiss labour market.

The KMU portal lists the kind of evidence that helps:

  • the business diversifies the region's economy;
  • it creates or keeps several jobs for local workers;
  • it involves substantial investment;
  • it brings new orders to Swiss companies.

Applicants are expected to submit a convincing business plan, along with documents such as the founding deed or commercial register entry. If approved, they receive an L permit (short stay) or a B permit (residence). Both are limited by annual quotas set by the Federal Council.

United Kingdom citizens

Since Brexit, UK citizens who were not already living in Switzerland are generally treated as third-country nationals, although some special arrangements apply. Check with the cantonal migration office.

Running a Swiss company from abroad

Many owners live abroad and run their Swiss company remotely, while a resident representative fulfils the legal requirement. This is legal, but there are points to consider:

  • Tax residence: a company can be taxed where it is effectively managed. If all key decisions are taken abroad, another country may claim the right to tax the company.
  • Banking: some Swiss banks are cautious about companies with no founders in Switzerland. See our guide to Swiss business bank accounts.
  • Substance: the company should have a real address and genuine activity at its registered office, particularly if you choose a low-tax canton. Our guide to corporate tax explains how location affects taxes.

Hiring staff in Switzerland

Once your company is running, you may want to hire people. Hiring EU/EFTA citizens is relatively straightforward, while recruiting from other countries is restricted to qualified specialists and subject to quotas. Our guide to hiring employees in Switzerland covers contracts and social insurance.

Where to get help

  • the cantonal migration office for permits;
  • the cantonal economic development office, which supports foreign companies settling in the canton;
  • the federal KMU portal for foreign founders;
  • a Swiss lawyer or fiduciary for structuring and tax questions.

Why it matters

Switzerland is open to foreign founders, but the rules are different from countries where anyone can register a company online from anywhere. Planning for the resident representative, the permit and the bank account from the beginning makes the whole process smoother.

Immigration rules change and are applied by the cantons. Always confirm your situation with the cantonal authorities before you move or sign contracts.

Further reading

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