Legal Essentials for Swiss Startups

July 2025

Building a Strong Legal Foundation for Your Swiss Startup

Establishing proper legal foundations is critical for startup success, yet many entrepreneurs understandably focus on product development and market traction while deferring legal considerations. For Swiss startups, understanding and addressing key legal requirements early can prevent costly issues, protect valuable assets, and create a solid foundation for growth.

Business Formation and Structure

Choosing the right legal structure for your Swiss startup is a foundational decision with significant implications:

Entity Types and Considerations

• Limited Liability Company (GmbH/Sàrl): Popular for smaller startups with minimal capital requirements (CHF 20,000 minimum capital), offering limited liability protection with simpler governance.

• Corporation (AG/SA): Preferred for startups seeking venture capital, with higher capital requirements (CHF 100,000 minimum capital, 50% paid-in) but greater flexibility for equity distribution and fundraising.

• Branch Office: An option for foreign companies expanding into Switzerland, operating as an extension of the parent company.

Formation Process

The Swiss company formation process involves several key steps:

1. Articles of Association: Drafting the foundational document defining company purpose, governance, and shareholder rights.

2. Capital Requirements: Meeting minimum capital requirements and depositing funds in a blocked account.

3. Public Notarization: Formalizing key documents through a notary public.

4. Commercial Register: Registering the company with the cantonal commercial register to establish legal existence.

Intellectual Property Protection

For knowledge-based startups, intellectual property (IP) protection is particularly crucial:

• Patents: Protecting technical innovations through Swiss and international patent filings.

• Trademarks: Securing brand elements through Swiss and international trademark registrations.

• Copyrights: Understanding automatic copyright protection and documentation strategies.

• Trade Secrets: Implementing confidentiality measures and agreements to protect valuable know-how.

Key Contracts and Agreements

Several essential agreements form the legal infrastructure of a startup:

• Founder Agreements: Clarifying roles, responsibilities, equity distribution, and exit provisions among founders.

• Employment Contracts: Developing compliant employment agreements with appropriate IP assignments and confidentiality provisions.

• Customer and Supplier Agreements: Creating standardized terms that protect the company while facilitating business relationships.

• Investment Agreements: Structuring relationships with investors through shareholder agreements, subscription agreements, and term sheets.

Regulatory Compliance

Swiss startups must navigate various regulatory requirements:

• Data Protection: Complying with Swiss data protection law and, where applicable, the GDPR.

• Industry-Specific Regulations: Understanding requirements specific to your sector (e.g., fintech, healthcare, food).

• Employment Regulations: Following Swiss employment laws regarding working hours, benefits, and termination procedures.

SSDG's Approach to Startup Legal Support

At SSDG, we help Swiss startups build strong legal foundations through:

• Legal Structure Advisory: Guidance on optimal legal structures based on business model, growth plans, and funding strategy.

• Formation Support: Practical assistance with the company formation process.

• IP Strategy Development: Strategic advice on protecting and leveraging intellectual property.

• Contract Templates and Review: Development of tailored legal agreements and review of proposed contracts.

By addressing legal essentials early and strategically, Swiss startups can avoid common pitfalls, protect their innovations, and create a solid platform for growth. Our legal advisors combine deep knowledge of Swiss business law with practical startup experience to provide guidance that is both legally sound and business-oriented.