Amendment of the articles of association of a Swiss company by a notary abroad versus a virtual meeting
In Switzerland, the provisions relating to both joint-stock and limited liability companies are mostly contained in the Code of Obligations of March 30, 1910 ("hereinafter referred to as the CO")1. The CO deals with various types of contractual relationships, from the contract of sale to the contract of employment and the regulation of companies. Thus, there is no separate law in Switzerland, like the Code of Commercial Companies in Poland, dealing exclusively with the subject of commercial companies.
Unlike Polish law, the CO first regulates joint-stock companies (hereinafter referred to as "AG") in Articles 620-763 of the CO, and only from Article 772 onward is a limited liability company (hereinafter referred to as "GmbH") regulated. This redaction makes it necessary to consider the AG provisions as a model for GmbHs as well. Many of the AG provisions are subsidiary to the GmbH, particularly when the GmbH provisions do not contain any regulation on the matter.
The rules for holding abroad a shareholders' meeting or general meeting of a company domiciled in Switzerland presented in the following article apply to both GmbHs and AGs. For ease of reference, we will use the term Assembly, both in the context of a shareholders' meeting of a limited liability company and a general meeting of a joint stock company.
The following article deals only with an Assembly to amend a company's contract or articles of association, for which the presence of a notary is required. The following article does not deal with the timing or content of the convening or the agenda2.
As a general rule, the Assembly should be held at the company's registered office. There can be exceptions to this rule, which is particularly important nowadays, when shareholders are looking for ways to optimize the company's ownership processes and often decide to convene the Assembly outside not only the registered office, e.g. in another Canton, but also outside Switzerland, e.g. in Poland.
Swiss law allows the Assembly to be held abroad as long as the articles of association explicitly provide for this possibility.
The authority to decide whether to hold the Assembly abroad is vested in the Board of Directors (Executive Board), which then appoints an independent proxy responsible for holding the Assembly3. The proxy has the task of guaranteeing full representation of the shareholders or partners at the Assembly abroad, in addition, his/her task is to ensure the exercise of the rights of the shares or stocks, especially voting rights, by those absent in person from the Assembly. In the case of unlisted companies, the Board of Directors (with the consent of all shareholders or partners) may refrain from appointing a proxy.
Pursuant to Article 647 of the CO, an amendment to the articles of association or the contract may be passed by the Assembly only in the form of a notarial deed. If the Assembly amending the articles of association or contract is to be held, the right to conduct the notarial act is vested in the notary of the state in which the Assembly is to be held.
In the event that the law stipulates that a foreign notarial deed must be filed with the Office of the Commercial Register, the latter may be required to demonstrate that the foreign notarial deed procedure is equivalent to the Swiss one. For this purpose, the Trade Registry Office may require the submission of an expert opinion, and may also appoint an expert4.
For example, in the case of a Polish notarial deed, an expert opinion would be required, which would show that the Polish notarial deed is equivalent to the Swiss one. Examples of institutions that could issue such an opinion include:
• The Swiss Institute of Comparative Law,
• Another equivalent independent institute,
• A university professor working in the field of comparative law5.
In addition, they are required to be stamped with an apostille clause in each case6, and this also applies to sworn translations.
An amendment to Swiss law, which came into effect on January 1, 2023, allows for the possibility of holding a so-called virtual Assembly ("VA") and thus simplifies the possibility of holding an Assembly outside Switzerland. VAs represent an innovative step forward, allowing companies to hold Assemblies online without specifying a venue, enabling shareholders to participate without their physical presence7. The VA takes place via electronic means, using a communication platform that ensures smooth real-time video and audio transmissions, the possibility of interaction and the security of participants. The VA avoids the difficulties described above, as it allows the Assembly to take place without a foreign notary but with a Swiss notary attending the Assembly from Switzerland.
The legal basis for holding the Assembly in virtual form, as well as allowing the Assembly to be held abroad, must be in the Articles of Association or the contract.
The company's Board of Directors is required to provide access to the platform enabling the Assembly to be held. To guarantee the security and correctness of establishing the identity of participants, identification methods such as qualified electronic signatures or TAN procedures are applicable. The platform should be equipped with chat features that allow active interaction between participants, including the ability to ask questions and participate in discussions.
The Board of Directors, when convening a VA as in the case of Assemblies that may be held abroad, shall appoint an independent proxy. In the case of unlisted companies, the company's articles of association may provide for waiving the obligation to appoint a proxy8.
Summary
Conducting an Assembly of a company headquartered in Switzerland outside the country is a rather complex task, in which the Office of the Commercial Register may require the legal opinion described above.
The introduction of the possibility of a VA is an interesting solution, allowing shareholders or partners to participate in the Assembly regardless of where they are located, and allowing the participation of a Swiss notary while maintaining legal certainty.
If you have any questions, please feel free to contact us.
_____
1 Bundesgesetz vom 30. marca 1911 betreffend die Ergänzung des Schweizerischen Zivilgesetzbuches (Fünfter Teil: Obligationenrecht), https://www.fedlex.admin.ch/eli/cc/27/317_321_377/de
2 The rules for convening the Assembly are set forth in detail in the law (Article 706 et seq. CO).
3 Art. 701(b) of the March 30, 1911 Bundesgesetz betreffend die Ergänzung des Schweizerischen Zivilgesetzbuches (fünfter Teil: Obligationenrecht).
4 Art. 25 of the October 17, 2007 Handelsregisterverordnung.
5 Art. 184 zd. 2 of the March 30, 1911 Zivilprozessordnung.
6 Article 3 of the October 5, 1961 Hague Convention Abolishing the Requirement of Legalization for Foreign Public Documents.
7 Art. 701 lit. d et seq. of March 30, 1911 Bundesgesetz betreffend die Ergänzung des Schweizerischen Zivilgesetzbuches (fünfter Teil: Obligationenrecht).
8 Art. 701(d)(2) of March 30, 1911 Bundesgesetz betreffend die Ergänzung des Schweizerischen Zivilgesetzbuches (fünfter Teil: Obligationenrecht).
