SWITZERLAND Law and Practice Contributed by: Alexander Vogel, Marc Baumberger and Selina Bruderer, MLL Legal
depending on the intended governance structure, liability regime and commercial purpose. Concerning capital requirements, (i) a simple partner - ship does not require registration, a minimum capi - tal contribution or a specific form, but it also lacks legal personality and subjects the partners to joint and several liability; (ii) a GmbH requires a minimum share capital of CHF20,000, fully paid in; and (iii) an AG requires a minimum share capital of CHF100,000, with at least CHF50,000 paid in at incorporation. 6. Core Terms of a JV Agreement 6.1 Drafting and Structure of the Agreement The documentation of a JV under Swiss law depends on the legal form chosen for the JV vehicle. Contractual JVs In the case of a contractual JV (eg, a simple partner - ship), the terms of the co-operation are typically set out in a JV agreement. This agreement governs the parties’ rights and obligations, profit and loss alloca - tion, governance, contributions, confidentiality, non- compete clauses, dispute resolution and termination. Since no separate legal entity is formed, the JV agree - ment is the central and binding document. Corporate JVs Where a corporate JV is established (eg, as a Swiss stock corporation (AG/SA) or limited liability company (GmbH/Sàrl)), the relationship is documented in mul - tiple layers: • Articles of association ( Statuten /statutes) – these are public and govern the fundamental corporate structure, including share capital, share classes, shareholder rights, general meeting procedures and board composition. • Shareholders’ agreement/JV agreement – this is a private agreement between the JV parties that regulates their relationship beyond what is covered in the articles, and it typically contains detailed provisions on: (a) governance and control – board composition, quorum and voting rights, reserved matters and appointment rights;
(b) capital contributions and future funding obliga - tions; (c) profit distribution – dividend policy and prefer - ence rights (if any); (d) transfer restrictions – lock-up periods, rights of first refusal, tag-along and drag-along rights; (e) exit provisions – call/put options, IPOs or buy - out mechanisms; (f) deadlock resolution mechanisms; (g) non-compete, confidentiality and IP arrange - ments; and (h) dispute resolution and governing law. • Organisational regulations/board rules – optional internal documents that define the delegation of duties within the company and clarify the responsi - bilities between the board and management. In all forms, the documentation must be carefully aligned with the chosen legal structure to ensure enforceability and consistency with mandatory Swiss corporate law. 6.2 Governance and Decision-Making Generally, the main objective when setting up the decision-making aspects of a JV entity is to duly reflect and balance the partners’ interests, level of participation and even the know-how they bring to the JV. This is usually done by way of specific regulations at the level of both the shareholders’ meeting and the board of directors. The potential for a deadlock situa - tion and routes to avoid/handle such events shall be considered. Shareholders’ Meeting Since JV companies typically have a small number of shareholders, their meetings are commonly referred to as universal meetings – ie, all shareholders are present/represented. The unique feature of univer - sal meetings is that shareholders can deliberate and make decisions on any agenda item without needing to fulfil the formal convening requirements that are typical of larger corporate meetings, such as an invita - tion period of 20 days. Generally, the shareholder’s meeting passes resolu - tions with the majority of voting rights represented at the meeting, unless a higher quorum is provided for in the articles of association. By law, certain important
169 CHAMBERS.COM
Powered by FlippingBook