Despite Switzerland having one of the best business environments in the world, some businesses still find themselves having to shut down their Swiss operations for various reasons. Such circumstances are usually a result of mismanagement of the company, bankruptcy, disputes or loss of interest by the investors among many other reasons. The Swiss government has put in place several laws and regulations that apply to companies undergoing insolvency and closure. These rules address issues such as the responsibilities of directors and mechanisms to utilise when declaring bankruptcy.


The Swiss Code of Obligations contains various rules on restructuring measures, especially for the most popular corporate forms offered by Swiss law, namely the corporation and the limited liability company. These measures involve creditors or owners, meaning the company's shareholders or quota holders of a limited liability company.


The Swiss Debt Enforcement and Bankruptcy Act regulates the formal procedure, which is court-based and is primarily administrative. This law mainly regulates the debts enforcement, that is claims in money, and insolvency proceedings against individual and legal entities. It also establishes the procedure for the composition of guarantees, containing further rules for the composition of procedures and agreements.


For the financial sector, special rules on bankruptcy are applied and these are included in Swiss banking acts. Furthermore, the Swiss Federal Act on Private International Law stipulates rules for insolvency and bankruptcy involving cross-border issues.

According to the criminal law, fraudulent bankruptcy or disposition of confiscated assets are classified as criminal acts.

Liquidation options for Swiss companies

The decision to liquidate a company in Switzerland usually occurs through a resolution of the shareholders' meeting. In order for the dissolution procedure to begin, a majority of shareholders' votes are required, unless the statutory documents of the company mentions otherwise.

Voluntary liquidations

In order for a limited liability company in Switzerland to undergo dissolution properly, it must meet certain conditions. Closure may happen using the articles of association, which, for example, can limit the life of the company, making it dependent on a condition that is no longer applicable. In this case, the initiation of the winding-up procedure is the responsibility of a competent corporate body, and not triggered automatically. 

If there is no statement of reasons in the constitutive act, then there must be the establishment of a resolution after a meeting, and its notarization should occur publicly.

In addition, legal action for dissolution for good cause is possible, by means of a court order, and only if the shareholders represent at least 10% of the shareholding dissolution request. Of course, the court may order another solution, if necessary.

Incorporation errors and cases in which the companies aim immoral and illegal purposes can also represent criteria dissolution of a company established in Switzerland.

Voluntary dissolution is the most efficient and cost-effective way to close a Swiss company if there are no creditors.

It is important to note that if the company is not dissolving properly, then this could take time and money. In addition, you need to make sure that you do not violate any civil or criminal law. Therefore, it is advisable to contact specialized consultants for assistance and taxes in order to close your business.

Involuntary liquidations

Liquidation occurs in Switzerland when the company closure happens because of legal reasons such as bankruptcy, losses or merger with another company. If the bankruptcy application is the only solution for a business owner, it pays to start the process as quickly as possible.

Under a compulsory liquidation, the conducting of bankruptcy proceedings happen through a bankruptcy administrator. A court may impose these procedures in a statement following a request made either by a creditor or by the company because of over indebtedness. Another option is to complete an insolvency statement according to the Swiss Debt Enforcement and Bankruptcy Law.


There is a possibility to close a company without liquidation through restructuring transactions such as mergers, demergers, and transformations. The Federal Act on Merger, Demerger, Transformation and Transfer of Assets and Liabilities makes the regulation of these transactions.

There are several key tax consequences of liquidation, whether voluntary or involuntary or relocation abroad. One of them would be the difference between the book value and the market value subject to both the withholding tax and the corporate income tax.

In the case of voluntary winding-up, there is termination of Swiss fiscal debt only after payment of all taxes. It is important to note that there are no substantial differences between the tax consequences of voluntary or involuntary liquidation. The same may also apply to the cessation of economic activity without formal liquidation.

Pay attention to unpaid taxes! For these, liquidators are, in most circumstances, still accountable. It is important to protect your business assets, regardless of the option, but you need to comply with the liquidator's wishes, acting responsibly. For more information and advice about how to proceed, our Swiss consultants are ready to help you.

Reasons for closing a business in Switzerland

  • The company's cash flow shows constant problems

During the initial stages, most companies do not record a high value of profits. However, after a number of years, they are expected to become profitable and have a constant cash flow. If a Swiss company older than 5 years in the market and is in constant need of cash flow then it would be opportune to close it. Otherwise, the fact that the company is unable to pay its debts, expenses and other current cost may affect the enterprise's overall activity.

  • Customers have a low engagement 

There is a risk that the company's products or services will not meet the consumer's needs. In this case, investors need to consider improving the product range and increasing the quality; otherwise, the business will not be profitable. Our Swiss specialists in opening a company can provide advice for businesses facing these issues. 

  • Employees have low qualifications

The workforce value is one of the most important aspects when entrepreneurs decide to open a company in Switzerland. Sometimes employees may not meet the needs of the company, although the Swiss workforce is renowned for its high level of skills. This can affect business productivity. Therefore, it is necessary to study the characteristics of the local workforce before setting up a company.

Voluntary liquidation or closing a business in Switzerland, for whatever reason, can be daunting if you do not know what to do. We recommend that you close or liquidate a company in Switzerland in a transparent way, without the risk of any liability. Our team can offer a full package of personalized services tailored to your individual or corporate needs.



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