Director resident in Switzerland: when it is mandatory

Anyone incorporating a Swiss company from abroad soon comes across a question: do you really need someone resident in Switzerland? The answer is yes, but the requirement is often misunderstood. It is not necessary for all the directors to be Swiss or resident. What is needed is that the company can be represented by at least one person domiciled in Switzerland. The difference is substantial. Let’s look at it precisely.

What the law actually says

The Code of Obligations provides that a GmbH and an AG must be able to be represented by a person domiciled in Switzerland. This person must hold signatory power and have access to the list of members or the share register, so as to be able to act for the company towards third parties and authorities.

The requirement does not concern nationality: a foreign citizen domiciled in Switzerland satisfies it perfectly. Nor does it concern the majority of the governing body: the other directors may perfectly well reside abroad. What matters is that the Swiss “anchor” always exists.

What this requirement is for

The reason is practical and one of public order: Switzerland wants every corporation to have a reachable point of contact on its territory. Someone is needed who:

• can receive official notifications and communications;
• can sign deeds and represent the company;
• answers before the authorities, creditors and courts.

Without this figure, a company could be run entirely from abroad and be effectively unreachable in the event of a dispute or proceedings. The requirement prevents “empty shells” with no anchoring.

Who can fill the role

The person domiciled in Switzerland with signatory power can be:

• a member of the board of directors (for the AG) or a managing officer (for the GmbH) who resides in Switzerland;
• a registered director or authorised signatory (Prokurist), with power of representation, domiciled in Switzerland.

The important thing is that at least one person with signatory power — individual or, in combination, joint — has a Swiss domicile. The law requires the ability to represent the company, not that the resident holds all the powers on their own.

The case of the foreign entrepreneur

The issue becomes concrete for the entrepreneur who lives abroad and wants a Swiss company. In this case they essentially have two paths:

1. Relocate or appoint a resident partner: if someone from the management team settles in Switzerland, the requirement is met internally.
2. Turn to a director or representative with a Swiss domicile: a professional figure who takes on the office or the representation needed to meet the legal requirement.

This second route is entirely legitimate and is the most common for those who run the company from abroad. It must, however, be set up seriously: whoever lends their domicile and their signature takes on real responsibilities and must be genuinely involved and informed.

Beware: it is not just a signature of convenience

A frequent mistake is to consider the resident director a purely formal compliance step. It is not. Whoever holds an office on a board of directors or as a managing officer takes on the duties of care and loyalty and is personally liable in the event of a breach. The representative with signatory power also acts with responsibility.

For this reason the choice of person, the definition of their powers and the organisation of the information flows are not details: they are the heart of a structure that holds up. A “lent” signature without involvement exposes both the company and whoever provides it.

What happens if the requirement is not met

If the company loses the person domiciled in Switzerland with signatory power — for example because the only resident resigns or transfers their domicile abroad — a gap in the organisation is created. In these cases the commercial register office can intervene, order the company to restore the situation and, failing that, initiate measures that can go as far as dissolution. It is a situation to prevent, not to manage at the last minute.

How we work at SIH ONE

We provide the representation with a Swiss domicile needed to meet the legal requirement, with real and responsible involvement, and we structure the signatory powers in a way that is consistent with the company’s operations. No signatures of convenience: solid solutions that hold up over time.

Do you run your company from abroad and need a reliable Swiss anchor? Discover our domiciliation services and bring your business into compliance.