Business in Switzerland. The reasons to choose Swiss jurisdiction to incorporate a company.

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Prestige of a particular jurisdiction and the possibility of tax optimization which would be beneficial for business, are the main criteria usually considered by business owners while determining a country to incorporate a company.

Undoubtedly, Switzerland prevails at all points, and it also provides additional opportunities that are significant in terms of business perspectives:

1) Defined and understandable corporate legislation.

This is important for every businessman starting a business abroad, in order to be aware of the opportunities and limitations for his company, the means of decision-making and the mechanisms to protect the minority shareholder in the corporate structure.

2) Strict regulation of banking operations, which guarantees the reliability of deposits and conducting business within the country in general .

Swiss banks lead on the world financial market, taking into account the factor of political and economic stability of the state, and are considered the oldest financial institutions, which increases their prestige. In addition, the Basel Committee on Banking Supervision is located in Switzerland, and the standards and methodologies adopted by the committee are implemented by governments all over the world. The Swiss financial regulator FINMA (Financial Market Supervisory Authority) periodically tightens its control over banking operations in the country, which reduces risks when dealing with banks. Subject to it, having your company’s account in a Swiss bank automatically demonstrates business’ reliability, which in turn might attract prospective clients, while the company’s substance (actual presence) in Switzerland simplifies the account opening process in a Swiss bank.

3) Friendly, predictable and stable tax environment – one of the most significant advantages of Swiss jurisdiction.

The tax system differs through every canton, however in general a relatively low corporate tax, the average European VAT rate are established in the country, and withholding tax is reduced to 0% on cross-border payments of dividends between related companies residing in EU member states.

An important factor is that Switzerland has signed agreements on the avoidance of double taxation with the majority of states of the world, except for some African countries. It makes available to conduct business from Switzerland internationally in the most profitable way.

Apart from the undeniable reliability and prestige of this jurisdiction, Switzerland is a new haven for the fin-tech sphere. FINMA was among the first to publish guidelines clarifying the legal aspects of ICOs (Initial Coin Offering), while canton Zug has been unofficially called the “Swiss Silicon Valley” for fin-tech, blockchain and crypto business.

Particularly the Swiss banks initially began to deal with crypto business and virtual assets successfully and safely.

Starting from 2019, fin-tech received the opportunity to operate under an updated license with an increased amount of allowable public deposits. Thus, fin-tech startups have approached banking institutions in terms of regulation, and new opportunities have been provided to business owners while the task of opening an account for the company has been simplified.