Hi all,

I am a UK citizen and have established a Swiss AG company. I am trying to purchase an apartment with this firm. The Notar (in Stäfa) is a bit worried and wants 3 months to check out whether this is a foreign company. As the firm is a Swiss registered AG firm and I have all the documents to prove it, I am a bit confused as to what the Notar is looking for as they cannot tell me what they are looking either. Has anyone had any experience with anything simliar.

Cheers,
John

This does sound a little strange - what is the nationality of the other directors/shareholders? Do you have a Swiss person involved?

The AG need the majority of directors to be: (EU or swiss national ) AND (swiss resident)...is this an issue with your company ?

I suppose you already know the following, but maybe the Notar is behind the times...

dave

"Regulations have determined who can own what kind of property and for what purpose since the early 1960s. The Federal Law on the Acquisition of Real Estate by Persons Abroad, known as the Lex Friedrich, of 16 December, 1983, meant that foreign companies and individuals were not allowed to acquire Swiss property without specific authorisation from the relevant canton. Individuals could only buy property in which they would live, while foreign companies could only buy property that they would use as their place of business.
Property could not be bought for investment purposes. Although foreigners were allowed to acquire holiday homes, the number of authorisations given for such transactions was limited by quotas and, over the years, the restrictions became even more extensive.
The current legislation
The most important revised regulations — known as the Lex Kohler — date from 1997 and removed the requirement for authorisation for non-Swiss nationals to purchase real estate for business purposes. Properties used for commercial, industrial or trading activities are therefore considered to be business properties, whether the owner uses them or they are rented out to a third party to pursue an economic activity. As a result, a foreign investor can purchase such properties solely as investments.
However, accommodation and administration are not considered business activities, with the exception of accommodation acquired as part of a permanent business establishment when it is necessary for the business or it is impossible in practical terms to separate the accommodation from the business site.
One consequence of this is that as Government activities are classed as administrative, public-private partnerships cannot acquire real estate in Switzerland."

Thanks for the help, but the Notar will not clearly state the reason why, just that they need 3 months to check it out. Currently the directors are EU, but not Swiss. I did question this, and you need a Swiss person to establish an AG but afterwards, they can be removed as a director.

That is not quite correct. A Swiss national is not required if the directors are EU nationals. Directors resident in Switzerland are required.

Are the directors, or a majority of them, resident in Switzerland? This could be what the notar is investigating.

As an aside, if the directors deregister from Switzerland the company automatically goes into liquidation - this happened to a friend of mine and caused much amusement.

Hi sb, yes, all the directors are EU nationals, resident in Switzerland with B Permits. deregistering is good to know, thanks. John

Can't see the notar's problem then. Tried bribing him ?

That might just have to be the next step.

can't you change notaires?

Wish it was that easy, but you need to go through the local Notar where the property is being purchased.

Yep, closed shop, and the money they take off you - unbelievable .

this is quite old thread now but came across it when looking for some info on google. what was the upshot of all this?

Legal entities are considered "persons abroad" if they are either domiciled abroad or are controlled by persons abroad. Control of a legal entity by persons abroad is deemed where such persons abroad:

• a) own more than one-third of the company's equity capital
• b) dispose of more than one-third of the voting rights, whether directly or indirectly, in the shareholders' meeting of the company; or
• c) provide the company with repayable funds representing more than one half of the difference between the company's assets and its debts vis-à-vis persons that are not subject to the Lex Koller.

The Lex Friedrich Declaration serves to answer the question as to whether a company is to be referred to the licensing office under the terms of Art. 18, paragraphs 1 and 2, of the Federal Act governing the Acquisition of Real Estate by Persons resident abroad. Both documents are to be signed in their original handwriting by the persons filing the application.

But I should say that purchasing a commercial estate that can be used as residential (part of it, there is sometime rare offers) or even just commercial by an AG company with bearer shares (single owner is also possible now) will save a lot on inheritance tax, especially if there is no direct relatives. Even is you are a Swiss resident.