SWISS COMPANY FORMATION

Swiss Incorporation Guide

Requirements and review of Swiss legal entities in relation to cryptocurrency

1. Swiss Incorporation Requirements:
A Swiss corporation (AG) requires at least half of its directors to be Swiss residents, and a Swiss Limited Liability Company (GmbH; LLC) requires at least one operating officer to be a Swiss resident.
Therefore, in order to provide local moving services, specific information on business details must be confirmed and there must be no disqualification requirements for corporate operation. Also, Switzerland is one of the most expensive countries, so the services provided in the name of local directors and executives are quite expensive.

2. Swiss local regulations for cryptocurrencies (tokens):
Tokens are strictly regulated locally in Switzerland with respect to their issuance and trading, and the issuance of tokens is classified as a security if:

1) If there is no utility at the time of issuance (if the project is completed, such as pre-sale, issued before the stage where tokens can be used)
 
2) If you have the right to dividend or profit or voting right for the company

In order to issue tokens in Switzerland, a prospectus must be prepared, and the cases exempted from the prospectus are as follows.

1) When making a proposal to a professional investor to attract capital
2) If there are fewer than 500 investors
3) When making an offer to an investor who invests more than 100,000 Swiss francs
4) Raising an investment of less than 8 million Swiss Francs within 12 months

In relation to the circulation of tokens, the following actions are prohibited or restricted in Switzerland:

1) Distribution of tokens through decentralized exchanges (except when specifically authorized)
 
2) The entity that issued the token intervenes in the distribution channel or market, operates and distributes the exchange together, or arbitrarily controls liquidity

If you are not providing an exchange platform or business related to security tokens, most virtual asset services do not require a FINMA (Swiss Financial Market Authority) license in Switzerland, but as a financial intermediary, a Self Regulatory Organization (SRO) ) must be associated with Voluntary regulatory bodies (SROs) are regulated by the Swiss Financial Markets Authority.


The minimum requirements for association (membership) with a Self Regulatory Organization (SRO) are as follows.

1) All operations must be carried out in Switzerland
2) Must be able to efficiently implement anti-money laundering regulations
3) Must be able to carry out all regulations related to local regulations
4) Without SRO linkage (membership), it cannot act as a financial intermediary.


Depending on the transaction type, it may be necessary to acquire a securities dealer license or a fintech license in Switzerland. In order to acquire a fintech license, the following requirements must be met.

1) Minimum capital of 300,000 Swiss francs or more or 3% or more of customer deposits, whichever is higher
2) The minimum capital must be retained at all times and must not be used for operating expenses or other purposes.
3) Customer deposit assets must be less than 1 million Swiss francs.
4) All operations in Switzerland must be practically carried out
 

The minimum requirements for a securities dealer license are as follows:
1) Minimum capital of 1.5 million Swiss Francs or more
2) All operations in Switzerland must be practically carried out

* The fact that all operations must be carried out in Switzerland means that all requirements such as offices, operating officers and decision makers must be satisfied in Switzerland.

In addition, risk management, audit, liquidity capacity, solvency capacity, operational capacity, internal control, anti-money laundering and other compliance regulations, Swiss account management, top strategy and separation of operating executives, etc. are all necessary as a financial institution. must be provided.

In conclusion, Switzerland has very strict regulations, very high operating costs, and there is a minimum requirement to register in the name of a local. It may only be suitable for companies that can meet all of the relevant requirements.
 

If you wish to establish a corporation, please submit a detailed description of your business activities or a white paper to the person in charge of our company, and we will proceed after prior consultation.

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