with its headquarters in Switzerland in the Commercial Register. This branch or subsidiary must be represented by at least one person residing in Switzerland. During the registration process, the compliance of the company’s articles of association with Swiss law will be verified, in particular the fact that it has a share capital in accordance with Swiss law (CHF 20,000 for a private limited company and CHF 100,000 for a limited company). From a Swiss labour law perspective, the company must apply for and obtain work permits that are eligible for entrance into Switzerland before employees may work for a company. From a Swiss foreigners’ law perspective, there are many differences between European nationals and non-European nationals. For non-European nationals, it is almost impossible to obtain a residency permit for people who are not self-employed. As a result, for non-European nationals, setting up a business is often an interesting option to explore for obtaining a residency permit in Switzerland. To obtain this permit, the applicant has to prove in particular that his business is viable, including producing a business plan. What steps are involved in this process? How does it differ for highnet-worth investors or EU nationals? The first consideration would be a person’s eligibility for entry to Switzerland. EU nationals are allowed to enter to Switzerland freely (AFMP). Most nonEuropean nationals need a Schengen visa to enter Switzerland. The second step is a work permit. For this matter, non-European nationals have to demonstrate very specific capacities, which often makes it difficult – if not impossible – for them to obtain a residency permit as employees. There are a number of incentives encouraging wealthy individuals to reside in Switzerland – for instance, the so-called lump-sum taxation. The expertise of an experienced law firm, providing bespoke advice and having an international know-how is paramount in assisting persons seeking a B permit. A residency permit based on a selfemployed activity (setting up a business) can be particularly interesting option for non-European citizens under the age of 55 years, who are not eligible to apply for residency as retirees unless they enrol for an expensive lump sum regime based on ‘major public interest’. What difficulties are entrepreneur immigrants most likely to encounter in this process? Entrepreneur immigrants may encounter legal and administrative issues in this process. As said above, the difficulties may arise according to the type of foreign permit that the entrepreneur wants to obtain, as well as his country of origin and the cantonal State in which he is applying for a permit. It is therefore essential for foreign entrepreneurs setting up a business in Switzerland to seek tailor-made advice from a law firm having extensive experience in these matters, taking into consideration all relevant parameters. What can a properly qualified lawyer do to ease this process and circumvent such problems before they arise? Choosing a law firm which has extensive, transversal and, above all, practical experience with applying for residency based on setting up a business in Switzerland. Such a permit necessitates the coordination of a very wide range or parameters, being pragmatic and understanding the spirit of entrepreneurship. It also includes various legal issues such as the regulations from the point of view of both company law and labour law. It is essential to choose a law firm which has the global know-how to establish a business plan, engage in estate planning and tax simulation (examination of the best options from a tax point of view) and give valuable real estate advice, as well as holding experience in family office matters – in a nutshell, a law firm that delivers all-round pragmatic and tailormade services. The selected law firm must also have a close and regular contact with the various competent authorities, thus facilitating the process for a foreign company wishing to start its activity in Switzerland. The choice of the seat, subsidiary, or branch may all be important, as might the legal form of the company. 58 LAWYER MONTHLY MAY 2023
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