7 practical adjustments in the new stock corporation law

• • Share capital continues to be a minimum of CHF 100,000, but it can now be denominated in a foreign currency material for the business activities (USD, EUR, GBP, JPY) under Art. 621 para. 2 nCO. The translation rate must be set on incorporation (stated in the articles of association), but share capital in Swiss francs can also be translated subsequently into foreign currency.
  • The capital range is a new option for increasing and decreasing capital:
    increases/decreases of up to 50% of existing share capital within five years are possible. As a result, authorized capital increases have been abolished.
  • Further obligations for the Board of Directors:
    • In addition to its existing obligations when more than half the capital is lost and in cases of excess debt, the Board of Directors now also has an explicit obligation to monitor solvency and take appropriate action in the event of (the threat of) insolvency.
    • If half the capital is lost, a limited audit of the last financial statements must be commissioned from a licensed auditor.
    • The statutory reserves relevant for the loss of half the capital have been redefined. Only statutory reserves of up to 50% of the share capital have to be taken into account when calculating the loss of half the capital, which is equivalent to an easing. In other words, if a stock corporation (Aktiengesellschaft) has share capital of CHF 100,000, only a maximum of CHF 50,000 is included in the calculation. Since half of the total is CHF 75,000, in this example half of the capital has been lost once equity falls below CHF 75,000.
  • Interim dividends paid within the year are now explicitly permitted, provided the conditions for a distribution are met, e.g. interim financial statements have been prepared. 
  • Intended contributions in kind by shareholders or related parties to them no longer count as a qualifying incorporation or capital increase (Art. 628 CO is repealed).
  • In future it will be sufficient to make the annual report and audit report available electronically in advance of the annual general meeting. Electronic media will be permitted at the annual general meeting making purely virtual AGMs possible, provided this is allowed in the articles of association. Where articles of association need to be amended anyway, we recommend updating them in this regard too.
  • Annual general meeting resolutions can be passed by way of circulation and the AGM may also be held abroad. Here too we recommend considering amending the articles of association.
  können auf dem Zirkularweg gefasst werden und die GV darf auch im Ausland stattfinden. Auch hier empfehlen wir eine Statutenänderung zu prüfen.

In summary, particular attention should be paid to the increased responsibilities of directors (including greater liability risks) as regards excess debt, loss of half the capital and solvency.

All companies should also review whether they need to amend their articles of association.