SWITZERLAND Law and Practice Contributed by: Lorenzo Olgiati and Pascal Hubli, Schellenberg Wittmer Ltd
• the shareholders (see 4.8 Consequences and Enforcement of Breach of Directors’ Duties ); and • in the event of the company’s bankruptcy, the company’s creditors (see 4.8 Consequences and Enforcement of Breach of Directors’ Duties ). 5.5 Disclosure by Shareholders in Publicly Traded Companies FinMIA requires that significant shareholders who acquire or sell equity securities (shares, any kind of rights to buy or sell including options or other financial instruments) of a Swiss-listed company (or foreign company primarily listed on a Swiss stock exchange) must notify the company and the stock exchange within four trading days if their holdings reach or cross any of the following voting rights thresholds: 3%, 5%, 10%, 15%, 20%, 25%, 33.33%, 50% or 66.66%. Within two additional trading days, the company must publicly disclose to the market any reports it has received concerning such changes in the owner - ship of its shares. 6. Corporate Reporting and Other Disclosures 6.1 Financial Reporting All Swiss companies are obliged to prepare an annual report with the annual accounts, com - posed of the balance sheet, the profit and loss statement, and the notes to the accounts. Larger companies must additionally draw up a cash flow statement and a management report. In general, the annual report must be made avail - able to the company’s shareholders. In private companies, however, it does not have to be dis - closed to the public.
meeting, the board must act within an appro - priate timeframe. In privately held companies, the convocation of a shareholders’ meeting may be requested by shareholder(s) holding at least 10% of the share capital or the voting power in the company. The notice must include the agenda items and the motions of the board of directors, and, if any, of the shareholders who have requested an extraordinary meeting to take place or solely requested an item to be placed on the agenda. These formal invitation rules may be disregard - ed in the case of a universal meeting, where all shareholders or representatives of all company shares are present. Shareholder Participation When holding the meeting, shareholders are entitled to participate and exercise their rights personally (see 5.3 Shareholder Meetings ) or by a proxy. Shareholders of listed companies may also authorise an institutional proxy, the so- called independent proxy. Such an independent proxy needs to be elected by the shareholders’ meeting and has to exercise the voting rights granted by the shareholders in accordance with their respective instructions. The independ - ent proxy must keep the voting instructions of shareholders confidential. Where the sharehold - ers’ meeting has not appointed an independ - ent proxy and there are no specific rules in the articles of association, the board should appoint one ahead of a next shareholders’ meeting. 5.4 Shareholder Claims Under Swiss company law, D&O liability actions may be brought against the members of the board and executive management by: • the company;
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