For foreign companies planning to explore the Swiss market without conducting commercial activities, a representative office (Liaison Office) serves as the ideal starting point. This guide walks you through the entire process: from choosing the right structure to registration procedures and tax obligations in Switzerland. > "Over the past 20 years, I've guided more than 300 companies through Swiss registration procedures. The most common question I hear is: 'Do we need a full subsidiary, or can we start smaller?' For market research and relationship-building, a liaison office is often the smartest first step—minimal formalities, no capital requirements, and a clear path to upgrade later if commercial activity begins." > — Markus Pritzker, founder of a Zurich-based corporate law boutique ## What is a representative office (Liaison / Representative Office) in Switzerland? A representative office in Switzerland is a non-independent corporate structure that allows foreign companies to establish a limited presence without creating a separate legal entity. It functions strictly as an extension of the parent company, with all liability resting on the foreign headquarters. > "A liaison office has no separate legal entity; it is an extension of the foreign parent and may not conduct commercial business." — Goldblum Legal Knowledge Base, 2025

Key Functions of a Representative Office

✅ ALLOWED

Market research
Representative functions
Maintaining relationships

❌ PROHIBITED

Concluding contracts
Issuing invoices
Import/Export of goods

### Legal status and key features The representative office is not a separate legal entity under Swiss law. It operates as part of the foreign parent company, meaning the parent bears full legal and financial responsibility for all activities conducted through the Swiss office. No minimum share capital is required, and the office does not need to register as a commercial company in the traditional sense. > "Setup involves a declaration to the cantonal Commercial Register and appointing a Swiss-resident representative; no share capital is required." — Swiss Law Firm, 2024 According to Swiss Commercial Register regulations, a liaison office must file a Declaration of Existence with the cantonal Commercial Register and appoint a local Swiss resident representative. The office is governed by the domicile legislation where it operates, but it does not acquire independent legal personality. From my experience advising international clients, this structure works best when the parent company wants to test the Swiss market without committing significant capital or triggering full tax obligations. The key advantage: you maintain operational flexibility while building local relationships and gathering market intelligence. ### Permitted activities: market research, marketing, communication A liaison office may engage only in preparatory and auxiliary activities that do not generate direct revenue. Permitted functions include: > "Permissible activities include market research, promotion, liaison, and trade fairs; invoicing clients or signing contracts is prohibited." — Company Formation Switzerland, 2024 - Conducting market research and competitive analysis - Promoting the parent company's products or services (indirect advertising, branding) - Coordinating with local partners, distributors, or potential clients - Participating in trade fairs and industry events - Preparing for future market entry (feasibility studies, regulatory research) These activities must remain strictly non-commercial. The office cannot invoice clients, sign binding contracts on behalf of the parent, or perform any function that creates Swiss-sourced income. ### Key restrictions: prohibition on commercial activity Any activity that generates direct revenue is prohibited. This includes: - Concluding sales contracts or service agreements - Issuing invoices to Swiss or international clients - Importing or exporting goods through the Swiss office - Operating warehouses or distribution centers - Providing paid consulting or professional services The prohibition on commercial activity is the foundation of the liaison office's tax-exempt status. If the office crosses this line—even unintentionally—it risks being reclassified as a permanent establishment (PE), triggering Swiss corporate income tax obligations and potential penalties. {{cta:cta-1}} ## Representative office, branch, or subsidiary: which form to choose? Choosing the right legal structure depends on your business goals, timeline, and risk tolerance. The table below compares the three main options for foreign companies entering Switzerland.

Aspect	Representative Office (Liaison Office)	Branch	Subsidiary (AG/GmbH)
Legal independence	No separate legal entity; extension of parent	No separate legal entity; extension of parent	Separate legal entity with full autonomy
Liability	Parent company fully liable	Parent company fully liable	Limited to share capital (CHF 20,000 for GmbH; CHF 100,000 for AG)
Permitted activities	Market research, liaison, promotion only	All lawful activities within parent's scope	Full commercial activities allowed
Taxation	Exempt from corporate income tax (if non-commercial)	Taxed on Swiss-sourced profits (typically around 15–25% depending on canton)	Taxed on worldwide profits (typically around 15–25% depending on canton)
Registration complexity	Simple administrative filing (7–14 business days)	Formal registration, accounting, and compliance (7–10 weeks)	Full incorporation process (4–6 weeks + ongoing compliance)
Minimum capital	None	None	CHF 20,000 (GmbH) or CHF 100,000 (AG)
Local representative	Mandatory Swiss resident	Mandatory Swiss resident	Board of directors (at least one Swiss resident)

> "Branches and subsidiaries are taxed on profits, typically around 15–25% depending on the canton." — Goldblum Legal Knowledge Base, 2025

Rep. Office vs. Branch vs. Subsidiary

Representative Office

Legal Status: Extension of parent

Liability: Parent company fully liable

Activities: Non-commercial only

Taxation: Tax-exempt (if compliant)

Capital: None required

Branch

Legal Status: Extension of parent

Liability: Parent company fully liable

Activities: Full commercial

Taxation: On Swiss profits (~15-25%)

Capital: None required

Subsidiary (AG/GmbH)

Legal Status: Separate legal entity

Liability: Limited to share capital

Activities: Full commercial

Taxation: On worldwide profits (~15-25%)

Capital: CHF 20k+ (GmbH) / 100k+ (AG)

### When a representative office is your best choice A liaison office is optimal when: - You are in the initial stage of market entry and need to assess demand before committing capital - Your primary goal is market research, relationship-building, or brand awareness - You want to minimize upfront costs and administrative burden - You do not plan to conduct commercial activities (sales, invoicing, contract signing) in the near term - You need a local presence to coordinate with Swiss partners or attend industry events In my practice, I've seen tech startups, e-commerce companies, and [consulting firms](https://swissfirma.com/opening-consulting-business-switzerland/) use liaison offices as a "beachhead" before scaling up to a branch or subsidiary. The key is to stay disciplined: if you start generating revenue or signing contracts, you must upgrade your structure immediately. ### When to choose a branch or subsidiary Consider a branch if: - You are ready to conduct full commercial operations in Switzerland - You want to sign contracts and invoice clients directly from the Swiss entity - You need operational independence but do not require a separate legal entity Consider a subsidiary (AG or GmbH) if: - You want full legal and operational independence from the parent company - You plan to raise capital, hire employees, or establish a long-term Swiss presence - You need limited liability protection for the parent company - You are targeting Swiss investors or clients who prefer to work with local entities For detailed guidance on registering a branch or subsidiary, see our dedicated pages on [Swiss company laws](https://swissfirma.com/swiss-company-laws/) and [share capital requirements](https://swissfirma.com/share-capital-switzerland/). ## Risk of being classified as a permanent establishment (PE) and how to avoid it One of the most critical compliance risks for a liaison office is being reclassified as a permanent establishment (PE) under [Swiss company laws](https://swissfirma.com/swiss-company-laws/) and double taxation treaties. If this happens, the office becomes subject to Swiss corporate income tax on profits attributable to the PE—potentially triggering back taxes, penalties, and double taxation issues. > "Keep activities strictly preparatory or auxiliary; negotiating deals or signing contracts can create a permanent establishment." — Goldblum Legal Knowledge Base, 2025 A permanent establishment arises when a foreign company has a fixed place of business in Switzerland through which it carries out business activities that go beyond preparatory or auxiliary functions. Under the OECD Model Tax Convention and Switzerland's double taxation treaties, a PE is created if the office: > "Moving beyond preparatory or auxiliary functions—such as negotiating or signing contracts—can create a Swiss permanent establishment." — Goldblum Legal Knowledge Base, 2025 - Concludes contracts on behalf of the parent company - Conducts negotiations that are the final stage of a transaction - Maintains a warehouse and regularly ships goods to Swiss clients - Performs core business functions (not merely support activities) Red flags that may trigger PE classification: - ❌ Signing sales contracts or service agreements from the Swiss office - ❌ Conducting final-stage negotiations (e.g., pricing, terms, delivery) - ❌ Operating a warehouse with regular inventory turnover - ❌ Performing essential business functions (e.g., product development, client servicing) To avoid PE risk, ensure that all revenue-generating activities remain with the parent company. The Swiss office should limit itself to market research, coordination, and relationship-building. If you are unsure whether a specific activity crosses the line, consult a Swiss tax advisor before proceeding. {{cta:cta-1}} ## How to open a representative office (Liaison Office) in Switzerland: step-by-step registration guide > "Establishing a liaison office usually takes 7–14 business days when documents are complete." — Goldblum Legal Knowledge Base, 2025 The registration process for a liaison office is straightforward compared to forming a branch or subsidiary. Most filings can be completed within 7–14 business days, provided all documents are prepared correctly.

4 Steps to Register a Representative Office

Decision & Documents

Parent company resolution and collection of articles of association and register extracts.

Appoint Representative

Appoint a mandatory Swiss-resident authorized signatory to act as the official contact.

Notary & Apostille

Notarize and apostille all parent company documents for official recognition in Switzerland.

Commercial Register

File the complete application with the cantonal Commercial Register to finalize registration.

### Step 1: decision by the parent company and document preparation The first step is to formalize the decision to open a Swiss representative office. This requires: - A resolution by the parent company's board of directors or shareholders, authorizing the establishment of the Swiss office - Appointment of a Swiss resident representative (see Step 2) - Preparation of supporting documents (articles of association, commercial register extract from the home country) All documents from the parent company must be notarized and apostilled (or legalized) for recognition in Switzerland. If the parent company is based in a country that is a signatory to the Hague Apostille Convention, an apostille is sufficient. Otherwise, consular legalization is required. ### Step 2: appointing a Swiss resident representative Swiss law requires that every representative office appoint at least one Swiss-resident authorized signatory. This person acts as the official contact between the office and Swiss authorities. The representative must have the authority to sign documents on behalf of the office and is legally responsible for ensuring compliance with Swiss regulations. In practice, many foreign companies hire a local lawyer, accountant, or corporate services provider to serve as the representative. From my experience, choosing the right representative is critical. This person will handle correspondence with the Commercial Register, tax authorities, and social security offices. Make sure they understand your business and can respond quickly to official requests. ### Step 3: notarial certification and apostille of documents All founding documents from the parent company—including the articles of association, commercial register extract, and board resolution—must be notarized in the home country and apostilled (or legalized) for use in Switzerland. If the parent company's directors cannot travel to Switzerland, they may grant a power of attorney to the Swiss representative, allowing that person to sign documents on their behalf. The power of attorney itself must be notarized and apostilled. ### Step 4: filing the application with the cantonal Commercial Register > "Registration requires a declaration of existence, a Swiss local address, and details of the appointed representative." — Swiss Law Firm, 2024 Once all documents are prepared, the Swiss representative submits the following to the Commercial Register of the relevant canton: - Declaration of Existence (a simple form stating that the office exists and its purpose) - Notarized and apostilled articles of association of the parent company - Commercial register extract from the parent company's home country (with apostille) - Board resolution authorizing the Swiss office - Power of attorney for the Swiss representative - Proof of local address (lease agreement or confirmation from a serviced office provider) The Commercial Register reviews the documents for completeness and compliance. If everything is in order, the office is registered within 7–14 business days. The office receives a registration certificate and is entered into the public Commercial Register database ([Zefix](https://www.zefix.ch)). #### Role of the Chamber of Commerce and Commercial Register in the registration process It is important to clarify that the Commercial Register (Handelsregister) is the official body responsible for registering representative offices, not the Chamber of Commerce. The Commercial Register is maintained by cantonal authorities and is the legal registry for all business entities in Switzerland. The Chamber of Commerce may provide advisory services—such as verifying the availability of a company name before registration—but it does not have the authority to register or approve the office. All official filings must be submitted to the Commercial Register of the canton where the office is located. ## Requirements and necessary documents ### List of documents from the foreign parent company To register a representative office, you must provide the following documents from the parent company: - Notarized and apostilled copy of the articles of association (or equivalent founding document) - Commercial register extract from the parent company's home country (with apostille, issued within the last 3 months) - Board resolution authorizing the establishment of the Swiss representative office - Power of attorney for the Swiss resident representative (notarized and apostilled) - Proof of local address in Switzerland (lease agreement or confirmation from a serviced office provider) All documents must be translated into one of Switzerland's official languages (German, French, or Italian) by a certified translator. The translation must be notarized. ### Requirements for the Swiss resident representative The representative must meet the following criteria: - Must have a permanent residence in Switzerland - Must have the legal capacity to act on behalf of the office - Must have the authority to sign documents and represent the office before Swiss authorities - Bears legal responsibility for the office's compliance with Swiss regulations In practice, the representative is often a lawyer, accountant, or corporate services provider who specializes in assisting foreign companies. The representative's name and address are publicly listed in the Commercial Register. ## Costs and timelines for opening a representative office ### Estimated government fees and charges The cost of registering a representative office is significantly lower than forming a branch or subsidiary. Typical fees include: - Commercial Register filing fee: CHF 420–600 (varies by canton) - Notary fees (in Switzerland): CHF 300–500 for document certification - Translation and apostille fees: CHF 200–1,000 (depending on the number of documents and languages) Total estimated government and administrative fees: CHF 1,000–2,500. ### Notarial and legal expenses If you engage a Swiss lawyer or corporate services provider to handle the registration, expect to pay: - Legal advisory and document preparation: CHF 1,500–3,000 - Ongoing compliance support (optional): CHF 1,000–2,000 per year ### Realistic registration timelines From the date of submitting a complete document package to the Commercial Register, the registration process typically takes 7–14 business days. However, the total timeline depends on: - How quickly you can obtain notarized and apostilled documents from the parent company's home country (1–4 weeks) - The availability of a Swiss resident representative - The workload of the cantonal Commercial Register (some cantons process filings faster than others) In my experience, the entire process—from initial consultation to receiving the registration certificate—takes 2–4 weeks for well-prepared clients. ## Tax status of a representative office in Switzerland: conditions for tax exemption A representative office in Switzerland enjoys a unique tax status: it is generally exempt from corporate income tax and VAT, provided it does not engage in commercial activities. However, this exemption is conditional and must be carefully maintained. For authoritative guidance, refer to the [Swiss Federal Tax Administration](https://www.estv.admin.ch) or consult a Swiss tax advisor to obtain a formal tax ruling. ### Exemption from corporate income tax > "Liaison offices are generally exempt from Swiss corporate income tax because they do not generate Swiss-sourced income." — Swiss Law Firm, 2024 A liaison office is exempt from Swiss corporate income tax if it meets the following conditions: - It does not generate Swiss-sourced income (no sales, invoicing, or contract signing) - Its activities are strictly preparatory or auxiliary (market research, liaison, promotion) - It does not create a permanent establishment under Swiss tax law or double taxation treaties If the office crosses the line into commercial activity—even unintentionally—it becomes subject to Swiss corporate income tax at rates ranging from 15% to 25%, depending on the canton. ### Exemption from VAT > "VAT registration is typically unnecessary unless taxable supplies are made or input VAT recovery is sought." — Company Formation Switzerland, 2024 A representative office is not required to register for VAT because it does not provide taxable services or sell goods in Switzerland. VAT registration is mandatory only if the office: - Provides services or sells goods to Swiss clients - Exceeds the VAT registration threshold (CHF 100,000 in annual turnover) Since a liaison office does not conduct commercial activities, it typically remains outside the VAT system. ### Importance of obtaining a tax ruling To minimize risk, I strongly recommend obtaining a tax ruling (advance tax decision) from the cantonal tax authorities. A tax ruling is a written confirmation from the tax office that your representative office qualifies for tax exemption based on its planned activities. The process involves submitting a detailed description of the office's functions, organizational structure, and relationship with the parent company. The tax authorities review the submission and issue a binding decision. If the facts remain unchanged, the ruling protects you from future tax reassessments. In my practice, clients who obtain a tax ruling sleep better at night. It provides legal certainty and demonstrates good faith to the tax authorities. Disclaimer: This information is general in nature and does not replace professional advice. Tax and legal regulations are subject to change; consult a qualified specialist for your specific situation. {{cta:cta-1}} ## Management and obligations after registration ### Managing personnel and payroll for employees > "Liaison offices may employ staff but must register with Swiss social security and handle payroll withholdings." — Company Formation Switzerland, 2024 Even though a representative office does not conduct commercial activities, it may hire employees to perform market research, coordination, and liaison functions. Once you hire staff, the office becomes an employer under Swiss law and must comply with the following obligations: - Social security registration: Register all employees with the Swiss social security system (AHV/IV/EO) and pay mandatory contributions - Withholding tax: If employees are foreign nationals without a Swiss residence permit, the office must withhold income tax at source and remit it to the cantonal tax authorities - [Employment contracts](https://swissfirma.com/drafting-vetting-documents-switzerland/): Prepare written employment contracts in accordance with Swiss labor law - Work permits: Ensure that all employees have the legal right to work in Switzerland (Swiss citizens, EU/EFTA nationals, or holders of valid work permits) From my experience, many foreign companies underestimate the complexity of Swiss payroll and social security compliance. I recommend engaging a local payroll provider or accountant to handle these obligations. ### Accounting and record-keeping obligations Although a representative office is not required to maintain full statutory accounts, it must keep records of all expenses to demonstrate its non-commercial status to the tax authorities. This includes: - Rent and utilities for the Swiss office - Salaries and social security contributions for employees - Travel and marketing expenses - Professional fees (legal, accounting, consulting) These records must be available for inspection by the cantonal tax authorities upon request. In practice, I advise clients to maintain a simple expense ledger and retain all invoices and receipts for at least 10 years. ## Strategic considerations and common mistakes ### Choosing a canton: what to consider? Switzerland is a federal country, and each canton has its own tax rates, administrative procedures, and business culture. The choice of canton can significantly impact your costs and operational efficiency.

Choosing a Canton: Key Hubs

Zug

Lowest corporate tax (~11.9%), streamlined administration, and home to "Crypto Valley". Ideal for tax efficiency.

Zurich

Switzerland's largest financial hub with access to top talent and professional services. Tax rate ~19.5-21%.

Geneva

An international center with a multilingual workforce, close to UN agencies and NGOs. Tax rate ~19-21.6%.

Zug: - Lowest effective corporate tax rate (~11.9%) - Streamlined administrative procedures - Home to "Crypto Valley" and many international companies ([Want to do an ICO in Zug?](https://swissfirma.com/want-to-do-an-ico-in-zug/)) - Highly qualified workforce (53% of workers have tertiary education) - Favorable tax ruling practice - [Company establishment in Zug Canton](https://swissfirma.com/company-establishment-zug-canton/) Zurich: - Largest city and financial hub - Access to top talent and professional services - Higher office rents (CHF 500–800 per m² per year) - Effective corporate tax rate ~19.5–21% - Strong infrastructure and international connectivity - [Company establishment in Zurich](https://swissfirma.com/company-establishment-zurich/) Geneva: - International business center (home to many UN agencies and NGOs) - Multilingual workforce (French, English, German) - Higher office rents and cost of living - Effective corporate tax rate ~19–21.6% - Proximity to France and international organizations In my experience, Zug is the best choice for companies prioritizing tax efficiency and administrative simplicity. Zurich is ideal if you need access to a large talent pool and financial services. Geneva is best for companies with international clients or ties to global organizations. ### Common mistakes to avoid Based on 20 years of advising foreign companies, here are the most common mistakes I see: - Underestimating the strictness of "non-commercial activity": Many clients assume they can conduct "a little bit" of sales or invoicing without triggering tax obligations. This is wrong. Any commercial activity—no matter how small—can lead to PE classification and tax liabilities. - Appointing an unqualified representative: The Swiss representative must be a resident with the legal capacity to act on behalf of the office. Appointing a friend or family member who does not understand Swiss regulations can lead to compliance failures. - Ignoring the need for a tax ruling: Without a formal tax ruling, you are operating in a gray area. If the tax authorities later disagree with your interpretation of "non-commercial activity," you may face back taxes and penalties. - Poor record-keeping: Even though full accounting is not required, you must maintain detailed expense records. If the tax authorities audit your office and find incomplete records, they may assume you are conducting commercial activities and assess taxes accordingly. {{cta:cta-1}} ## Get professional advice on opening your representative office in Switzerland Opening a representative office in Switzerland is a straightforward process, but it requires careful planning and compliance with Swiss regulations. If you are ready to take the first step into the Swiss market, our team can help. Disclaimer: All content on this website is provided for information purposes only and does not constitute legal, tax, or financial advice. We accept no responsibility for any loss or damage arising from reliance on this information.

How to open a representative office in Switzerland in 2026