A genuine resident-director requirement -- a contrast with most countries this platform covers
Swiss company law is a notable exception to the pattern this platform has documented for most other
countries. Under Article 718 paragraph 4 of the Swiss Code of Obligations, an AG/SA (stock corporation)
must be able to be represented by at least one board member -- or a director with individual or joint
signing authority -- who is resident in Switzerland; Article 814 paragraph 3 imposes the equivalent
requirement for a GmbH/Sarl (limited liability company), requiring at least one managing officer resident
in Switzerland with genuine signing power. This requirement applies regardless of the company's ownership
structure -- a 100%-foreign-owned Swiss company cannot have an entirely non-resident board or management.
A mere authorized signatory (Prokurist) without formal board or managing-officer status does not satisfy
this requirement. In practice, foreign-owned Swiss companies commonly satisfy it through a paid nominee
resident-director service offered by Swiss fiduciary and corporate-services firms -- a well-established,
legal commercial arrangement, though the nominee must genuinely be able to exercise the role (accessing
statutory registers, dealing with Swiss tax and social-security authorities) rather than acting as a
passive rubber stamp.
Company formation and personal residency are two separate processes
Incorporating a Swiss AG or GmbH -- with a nominee resident director satisfying the Article 718(4) or
814(3) requirement -- does not itself confer any residence or work rights on the foreign founder. A
non-EU national such as an Indian citizen who wants to personally relocate to Switzerland to manage the
company separately faces Switzerland's restrictive annual quota system for third-country nationals: 8,500
total permits for both 2025 and 2026, split 4,500 B permits (residence) and 4,000 L permits (short-term).
A founder pursuing self-employment must show the business serves “the economic interests of
Switzerland as a whole” -- job creation, capital investment, and contribution to the regional or
national economy -- a higher bar than mere commercial viability, and both the relevant canton and the
federal State Secretariat for Migration must approve the application.
Incorporating an Indian company as an NRI founder based in Switzerland
An NRI in Switzerland setting up an Indian private limited company follows the same Companies Act,
2013 framework as a founder based anywhere else -- including the requirement that at least one director
be a person who has stayed in India for a specified minimum number of days in the preceding calendar
year. This resident-director requirement is commonly satisfied by bringing in an India-based co-director
or professional nominee.
Common mistakes NRI founders and investors in Switzerland make:
- Assuming a 100%-foreign-owned Swiss company can have an entirely non-resident board or
management -- it cannot; Swiss law requires a genuine Switzerland-resident director or managing
officer regardless of ownership.
- Confusing appointing a nominee resident director with obtaining personal Swiss residency -- the
two are separate, only loosely linked processes.
- Not appointing a resident director for an Indian company back home, causing compliance issues
under India's Companies Act, 2013.
