SWITZERLAND Law and Practice Contributed by: Alexander Vogel, Marc Baumberger and Selina Bruderer, MLL Legal
be less clear, with a higher risk of disputes or inef - ficiencies. • Reduced long-term stability: Contractual JVs are typically appropriate for short-term or project- specific collaborations. If the parties intend to enter into a long-term partnership, a corporate JV may provide more stability and permanence. • Potential exit challenges: Even though terminating a contractual JV may in principle be more straight - forward, ending the collaboration and resolving any remaining obligations between the parties may be cumbersome (in particular because the items that a partner has contributed to the simple partner - ship do not automatically revert to the respective partner in an exit; see 8.1 Ownership and Use of IP ). The exit scenario should therefore be carefully considered and reflected in the JV’s contractual framework. • Limited transferability of interests: The transfer of ownership interests or shares is often more compli - cated than in a corporate JV, where the transfer of shares is often more streamlined. 2.2 Strategic Drivers for JV Structuring The choice of JV structure depends primarily on the specific requirements of the parties involved. For pro - jects of limited duration and scope, a contractual JV is often preferred due to its ease of establishment and adaptability. On the other hand, for long-term collabo - rations, in situations where the JV needs to interact directly with external parties or where limited liability is an important consideration, the more formal structure of a corporate JV is typically preferred. When deciding on the appropriate form of a JV in Switzerland, it is essential to thoroughly evaluate the following aspects: • formation and termination – careful consideration should be given to the procedures for establishing and terminating the JV; • liability of the JV partners – the extent of liability of the JV partner(s) should be clearly understood and assessed; • corporate governance structure – the division of power amongst the JV partners is a key element;
• confidentiality – the issue of confidentiality of the JV partners’ information and operations requires careful attention; • tax implications – the tax aspects of the JV, includ - ing its structure and operations, must be consid - ered, particularly for cross-border JVs; and • flexibility – the degree of flexibility offered by the chosen form of JV should be evaluated to ensure that it is consistent with the project’s objectives and potential future developments. 3. JV Regulation 3.1 Legal Framework and Regulatory Bodies Competition Commission Based on the nature of the JV and its potential impact on competition, the Swiss Competition Commission may have a role in reviewing and approving the JV from an antitrust perspective. Swiss Financial Market Supervisory Authority (“FINMA”) If the JV engages in financial activities such as bank - ing, insurance or securities trading, it may fall under the regulatory oversight of FINMA. FINMA supervises and regulates financial markets and institutions in Switzerland. Commercial Register Office The Commercial Register is maintained by the can - tonal authorities. A corporate JV must be registered with the competent Commercial Register; otherwise, it may qualify as a contractual JV. The Commercial Reg - ister office ensures transparency and (to some extent) compliance with legal requirements. Most of the infor - mation to be shared with the Commercial Register for registration purposes will be publicly available. Main Statutory Provisions Code of Obligations Various provisions of the CO are relevant when estab - lishing JVs. Key provisions include: • simple partnership (Articles 530–551); • corporation (Articles 620–763); and • limited liability company (Articles 772–827).
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