Corporate Housekeeping in SwitzerlandJuly 01, 2015
As of July 1 2015 there will be more restrictive measures put in place to try to offset money laundering activities using Swiss held accounts. There are set to be new regulations about reporting shareholder information that will:
* Identify the beneficial share holder
* Require that corporations maintain registers of the bearer holder and the beneficial holder
* Put more responsibility on the Board of Directors
In the near future companies will have to maintain registers of both the bearer holder and the beneficial holder, this information has to be recorded and maintained for up to 10 years and readily available and accessible if the need for review arises. The register can be kept electronically. The register compliance largely falls on the Board of Directors.
The identity of the beneficial share holder also has to be revealed while in the past that information could have been kept confidential. The Board of Directors will be directly responsible for reporting, errors or misinformation. The Board of Directors is mandated to take proactive action against any shareholder that has not reported by disallowing them from attending general meetings and withhold any dividend payments until such is complied with. If the Board of Directors fails in its duty it may lead to the liability of the Board of Directors.
Fines of up to CHF 500,000 can be levied against any corporate entity that willfully does not comply with the new regulations which also include Limited Liability Corporations (LLC).
Any person that buys bearer shares will have to report to the company within 30 days of the purchase even if they buy 1 share. The buyer has to report their full name, company name and address and produce proof of identification of the same.
Not every corporate entity will be governed by the new requirements: “All companies that are listed at a stock exchange are, in principle, exempt from the new reporting obligations. In addition, all companies are exempt whose shares are structured as intermediated securities under the Federal Intermediated Securities Act (Bucheffektengesetz). In the case of intermediated securities, the company must designate a depository in Switzerland where the shares are deposited or entered into the main register.”
Overall there are big changes coming that will affect how records are kept and liability for corporations that are not keeping the records as directed. This will take a little time to get used to and there will likely be more stringent rules not too far down the road.