Handbook for Investors. Business location in Switzerland.

Handbook for Investors.
Business location in Switzerland.
January 2010 Edition
invest-in-switzerland.com

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Welcome.
Dear Reader,
By choosing the right location for your company, you are creating
a decisive competitive advantage in the global marketplace. As
one of the most attractive business locations in the world, which
offers numerous strategic advantages, Switzerland provides the
best prerequisites for forward-looking research, production and
service companies.
This handbook for investors will provide you with the information
that you and your advisors need to set up a business in our country,
where being an entrepreneur has many advantages.
You will also find the contact details of our Chief Representatives
for the European markets, North America, Japan, China and India,
who will help you along the way. They are your first points of contact
for quick, confidential and competent advice at any time.
Dr. Eric Scheidegger
Ambassador
Deputy Director, State
Secretariat for Economic
Affairs SECO
Daniel Küng
CEO Osec
In addition, you will also find contact information for the cantonal
and regional business promotion agencies, as well as those of a
number of useful associations, organizations and service providers.
As you progress through your decision-making process, and
when you decide to start your activities here, we can guarantee
that you will quickly feel welcome in Switzerland. In all of the
cantons and regions, you will find government representatives and
agencies committed to maintaining business-friendly economic
policies. Our federal government works together with the cantonal
authorities and business promotion agencies in order to ensure
that Switzerland remains an attractive place to live and start a
company.
Dr. Eric Scheidegger
Ambassador
Deputy Director, State
Secretariat for Economic
Affairs SECO
Daniel Küng
CEO Osec
Handbook for Investors 2010
3

Introduction.
Dear Reader,
Urs Ziswiler
Ambassador of Switzerland
to the United States of America
Thank you for your interest in Switzerland as a location for your
business enterprise. This handbook for investors will provide you
with the information that you and your advisors need to set up a
business in our country, where being an entrepreneur has many advantages.
As you progress through your decision-making process,
and when you decide to start your activities there, we can guarantee
that you will quickly feel welcome in Switzerland. From Lake Constance
to Lake Geneva, from Basel to Chiasso, in all of the cantons
and regions, you will find government representatives and agencies
committed to maintaining business-friendly economic policies. Even
in the age of the global economy it is important for the success of
any business venture to find the right location. For future-oriented
companies searching for the best location for a regional headquarters,
or to establish research or production, or as a base for providing
services, the right location can be found in one of Switzerland’s
26 cantons. Switzerland continuously scores high marks in key FDI
criteria, and is recognized as the most competitive, multicultural
gateway to the growing European free trade zone, with over 500
million inhabitants. Nearly 700 North American companies – such as
Procter & Gamble, IBM, eBay, Google, Kraft Foods, Microsoft and
Amgen – have already set up shop in our country.
In 2008 alone over 30 new companies – both large and small –
followed suit and are already enjoying the high quality of life and
many advantages of doing business in Switzerland, including:
• central location in Europe and unlimited access to the EU market
• a well-educated, highly skilled workforce
• long working hours and very employer-friendly labor laws
• pro-business legal system which makes it easy to start operations
• excellent infrastructure
• moderate taxation
The Trade and Investment Promotion Agency of the Swiss Government
and its partners are ready to assist you in establishing and developing
your operations in Switzerland. You can count on our team
in the US, based in New York and Washington DC, to serve as your
one-stop shop for assistance in expanding to Switzerland, a truly
international and multicultural gateway located in the heart of Europe.
With best regards,
Urs Ziswiler
Ambassador of Switzerland to the United States of America
4 Handbook for Investors 2010

Table of contents.
Advantages offered by Switzerland .................. 8
1 An overview of Switzerland.
1.1 Geography ..........................................................10
1.2 Climate ...............................................................11
1.3 Political system ..................................................11
1.3.1 Federal structure ................................................11
1.3.2 Separation of powers at the federal level ...........11
1.3.3 Direct democracy and the concordance system ...12
1.3.4 Political stability and social harmony .................12
1.4 Public finances ...................................................13
1.5 Neutrality ............................................................14
1.6 Population ..........................................................14
1.7 Cosmopolitan and international outlook ............14
1.7.1 Languages and cultural heritage ........................14
1.7.2 Direct investments and Swiss corporations
abroad ................................................................15
1.7.3 International organizations .................................16
1.8 Switzerland in figures .........................................17
2 Economic structure.
2.1 Gross domestic product and industry structure....18
2.2 International integration ......................................20
2.2.1 Goods and services trade ..................................20
2.2.2 Direct investments ..............................................21
2.3 Key industry clusters ..........................................22
2.3.1 Life sciences, chemicals and pharmaceuticals ..22
2.3.2 Medical technology ............................................22
2.3.3 Financial services ...............................................23
2.3.4 Machinery, electrical engineering and metals
industry ..............................................................23
2.3.5 Watch industry ...................................................24
2.3.6 Information technology.......................................24
2.3.7 Environmental technology ..................................25
2.3.8 Commodities trading ..........................................25
2.3.9 Headquarters functions ......................................26
3 Economic framework.
3.1 International exchange of goods and services ...28
3.1.1 Free trade agreements, WTO and elimination
of trade restrictions ............................................28
3.1.2 Customs and excise ...........................................28
3.1.3 Rules of origin ....................................................29
3.2 Protection of free competition ............................29
3.3 Protection of intellectual property ......................29
3.3.1 Patents ...............................................................31
3.3.2 Brands ................................................................31
3.3.3 Designs...............................................................32
3.3.4 Copyright ............................................................32
3.4 Product provisions and product liability ..............32
3.4.1 Foodstuffs ..........................................................33
3.4.2 Pharmaceutical products ...................................33
3.4.3 Medical devices..................................................34
3.5 Land use planning and environmental protection ..34
3.5.1 Building and zoning ............................................34
3.5.2 Environment .......................................................35
4 Switzerland and Europe.
4.1 Trade and direct investments .............................36
4.2 Political and economic cooperation ...................37
4.2.1 Free movement of persons ................................37
4.2.2 Schengen Agreement .........................................37
4.2.3 Elimination of technical barriers to trade ............37
4.2.4 Research ............................................................38
4.2.5 Rail, road and air transport .................................38
4.2.6 Public procurement ............................................38
4.2.7 Trade in agricultural products .............................38
4.2.8 Taxation of savings income ................................38
4.3 The euro .............................................................39
5 Establishing and managing a company.
5.1 Corporate structures ..........................................40
5.1.1 Stock corporation (AG).......................................41
5.1.2 Limited liability company (GmbH) ......................41
5.1.3 Branch office ......................................................44
5.1.4 Limited partnership for collective investments ...44
5.1.5 Sole proprietorship and general partnership ......44
5.1.6 Joint venture .......................................................45
5.1.7 Ordinary partnership ...........................................45
5.2 Accounting .........................................................45
5.3 Auditing ..............................................................45
5.4 Establishing a business ......................................46
5.4.1 Procedure ...........................................................46
5.4.2 Entry in the commercial register .........................47
5.4.3 Foundation costs ................................................47
6 Visas, residence and work permits.
6.1 Entering the country and visas ...........................48
6.1.1 Visa regulations ..................................................48
6.1.2 Visa regulations for certain countries .................49
6.1.3 Application procedure ........................................51
6.2 Residing in Switzerland ......................................51
6.2.1 Types of permits .................................................51
6.2.2 Reunification of families .....................................52
6.3 Residing in Switzerland without gainful
employment ........................................................52
Handbook for Investors 2010
5

6.3.1 Stays of up to three months ...............................52
6.3.2 Longer stays .......................................................52
6.3.3 Special case: students .......................................53
6.4 Residing in Switzerland with gainful
employment ........................................................53
6.4.1 Professional licenses ..........................................54
6.4.2 Residence and employment of EU/EFTA citizens ..55
6.4.3 Residence and employment of non-EU/EFTA
citizens ...............................................................56
6.4.4 Trainees/interns ..................................................57
6.5 Naturalization .....................................................57
7 Real estate.
7.1 Looking for the right property .............................58
7.1.1 Residential and commercial properties ..............58
7.1.2 Temporary accommodation and furnished
apartments .........................................................59
7.2 Commercial properties .......................................59
7.2.1 Rental .................................................................59
7.2.2 Purchase ............................................................60
7.3 Residential properties .........................................61
7.3.1 Rental .................................................................61
7.3.2 Purchase ............................................................61
7.4 Legal aspects: building permits .........................64
7.5 Legal aspects: purchase of real estate by
persons abroad ..................................................64
7.5.1 No permit required .............................................64
7.5.2 Permit required ...................................................65
7.5.3 Reasons for permit .............................................65
7.5.4 Execution ............................................................66
8 Labor market and labor laws.
8.1 Employment and unemployment .......................67
8.2 Labor costs ........................................................68
8.2.1 Salaries ...............................................................68
8.2.2 Non-wage labor costs ........................................69
8.3 Labor laws ..........................................................70
8.3.1 Individual employment contracts .......................71
8.3.2 Collective labor contracts...................................71
8.3.3 Employee participation and employee
representation ....................................................72
8.4 Working hours and leisure time ..........................72
8.4.1 Normal working hours, maximum working
hours and working time models .........................72
8.4.2 Overtime and excess hours ................................72
8.4.3 Day work and evening work ...............................73
8.4.4 Night work, working on Sundays and public
holidays ..............................................................73
8.4.5 Holidays and public holidays .............................73
8.5 Notice of termination and short-time working ....74
8.5.1 Notice periods and protection against dismissal ..74
8.5.2 Short-time working and mass redundancies ......74
8.6 Social insurance .................................................75
8.6.1 Old age and survivors’ insurance (OASI)............77
8.6.2 Disability insurance (DI) ......................................77
8.6.3 Accident insurance .............................................77
8.6.4 Health insurance and daily sickness benefits ....77
8.6.5 Compensation for loss of income and
maternity benefits ................................................ 78
8.6.6 Unemployment insurance (UI) ............................78
8.6.7 Occupational pension scheme ...........................78
8.6.8 Family allowances ..............................................78
8.7 Recruitment ........................................................79
8.7.1 Public employment service ................................79
8.7.2 Employment agencies ........................................79
8.7.3 Headhunters .......................................................79
8.7.4 Staffing/temporary employment agencies .........79
9 Financial center and capital market.
9.1 Banks .................................................................81
9.1.1 Structure and general conditions .......................81
9.1.2 Supervision .........................................................82
9.1.3 Services ..............................................................82
9.1.4 Protection of deposits ........................................83
9.1.5 Taxation of savings income ................................83
9.2 Swiss stock market: SIX Swiss Exchange .........83
9.3 Business lending and real estate financing ........84
9.3.1 Financing of current business activity ................84
9.3.2 Mortgages ..........................................................84
9.4 Risk capital .........................................................86
9.4.1 Venture capital ....................................................86
9.4.2 Business angels .................................................86
9.4.3 State support ......................................................87
9.5 Capital costs and interest ...................................88
9.6 Inflation ...............................................................89
10 Overview of the Swiss tax system.
10.1 Taxation of corporate taxpayers .........................90
10.1.1 Corporate income tax – federal level ..................90
10.1.2 Corporate income tax – cantonal and
municipal level ....................................................91
10.1.3 Capital tax ..........................................................92
10.1.4 Tax incentives .....................................................92
10.2 Total tax rate in international comparison ..........93
10.3 Taxation of individual taxpayers ..........................94
10.3.1 Personal income tax ...........................................94
10.3.2 Wealth tax ...........................................................94
10.3.3 Expatriates .........................................................95
6 Handbook for Investors 2010

10.3.4 Cross-border commuters ...................................95
10.3.5 Lump-sum taxation ............................................95
10.3.6 Inheritance and gift tax .......................................96
10.4 Withholding tax ..................................................96
10.4.1 Domestic rates ...................................................96
10.4.2 Treaty rates .........................................................97
10.4.3 Bilateral agreements with the EU .......................97
10.5 Value added tax ..................................................97
10.5.1 Taxable persons .................................................97
10.5.2 Taxable supplies .................................................98
10.5.3 Taxable amount ..................................................98
10.5.4 Tax rates .............................................................98
10.5.5 Exemptions.........................................................98
10.5.6 Deduction of input taxes ....................................98
10.5.7 Exports ...............................................................99
10.5.8 International business activity ............................99
10.5.9. Non-resident enterprises ....................................99
10.6 Other taxes .........................................................99
10.6.1 Stamp taxes .......................................................99
10.6.2 Real estate taxes ..............................................100
10.7 Double taxation treaty network ........................100
10.8 Transfer pricing rules ........................................101
11 Infrastructure.
11.1 Transport ..........................................................102
11.1.1 Road network ...................................................102
11.1.2 Rail ...................................................................103
11.1.3 Air .....................................................................104
11.2 Energy ..............................................................106
11.3 Water ................................................................106
11.3.1 Drinking water ..................................................106
11.3.2 Waste water disposal and water pollution
control ..............................................................107
11.4 Communication ................................................107
11.5 Postal services .................................................108
11.6 Healthcare ........................................................108
11.6.1 Medical care .....................................................108
11.6.2 Health insurance...............................................109
12 Education and research.
12.1 Schooling and vocational training ....................110
12.1.1 Basic and further education .............................112
12.1.2 Vocational training ............................................113
12.2 Further education .............................................113
12.3 Universities and colleges ..................................114
12.3.1 Universities and technical colleges ..................114
12.3.2 Universities of applied sciences .......................115
12.3.3 Executive MBA program (EMBA) ......................116
12.4 International private schools and boarding
schools .............................................................116
12.5 Research and development..............................117
12.5.1 Swiss research industry ...................................117
12.5.2 International research and development
cooperation ......................................................119
13 Living in Switzerland.
13.1 Safety and quality of life ...................................120
13.2 Relocation and integration ...............................121
13.2.1 Relocation ........................................................122
13.2.2 Language courses ............................................122
13.3 Renting a property ............................................123
13.3.1 Security deposit and lease agreement .............123
13.3.2 House rules and maintenance ..........................123
13.4 Telephone, Internet and TV ..............................124
13.5 Insurance ..........................................................124
13.6 Public transport ................................................125
13.7 Leisure activities ...............................................125
13.7.1 Leisure and cultural activities ...........................125
13.7.2 Clubs and volunteer work ................................126
13.8 Income and cost of living .................................126
14 Promoting Switzerland.
14.1 Responsibilities ................................................129
14.2 Promotional policy and tools ............................129
14.3 Switzerland. Trade & Investment Promotion
services ............................................................129
14.4 Cantonal promotion ..........................................130
14.5 Tax relief as part of regional policy ...................131
14.6 Other organizations providing assistance ........132
14.6.1 CTI Innovation Promotion Agency ....................132
14.6.2 Technology parks and business incubation
centers..............................................................133
15 Appendix.
15.1 Addresses ........................................................136
15.2 Table of figures .................................................139
15.3 Possible service partners .................................140
Countries of Europe ..................................... 141
Swiss map ................................................... 142
Language regions ........................................ 143
Handbook for Investors 2010
7

Advantages offered by Switzerland.
1. Competitive political and
economic environment.
• Easy system for establishing a company, practice-based
corporate law
• Efficient official procedures and favorable regulatory environment
• Comprehensive protection of intellectual property
• No anti-dumping law
2. Ideal strategic location.
• Three of the four largest European markets and economies are
neighboring countries of Switzerland
• Communications and transportation center between northern
and southern Europe
3. High degree of international
integration, solid relationship between
Switzerland and Europe.
• Strong business orientation towards exports; high level of
direct investments abroad
• European Union is Switzerland’s most important trading partner,
relationships protected by broad-based, democratically legitimized
bilateral agreements
• English as language of communication along with four national
languages
4. First-class infrastructure, high
quality of life.
5. World-leading industry clusters.
• Leading neutral location for headquarters of European
organizations
• Globally unique concentration of companies specializing in
pharmaceuticals and life sciences
• Important financial center
• Market leader in the luxury watch industry
• Globally important location for commodities trading despite
scarcity of raw materials
6. Flexible labor market, high
productivity.
• Liberal labor law, employer-friendly regulations
• Low unemployment, high labor force participation rate
• Motivated, loyal and well educated workforce with good foreign
language skills and above-average international experience
7. Moderate tax burden.
• Tax rates which are able to compete with the rest of Europe
• Low duties, levies and other charges
• Attractive tax planning options
8. Efficient capital market,
favorable conditions.
• Wide range of banking and insurance products
• Favorable interest terms
• High degree of price stability and low inflation over the long term
• Extensive network of road, rail and air connections
• Reliable supply of energy, water and communications services
• First-class healthcare system
• Safe cities, undamaged environment
8 Handbook for Investors 2010

9. Excellent educational institutions,
leading center of innovation.
• Practice-oriented basic education and training, universities and
technical colleges that conduct world-renowned research, internationally
prestigious private schools and boarding schools
• Integration of research and business practice, participation in
international research exchange
• Support for putting innovation into practice
10. Professional support during the
location process.
• Competent advisory services
• Support in establishing contacts and finding business properties
• Tax relief and potential sources of financial assistance
Fig. 1: Switzerland’s international rankings
1
• Competitiveness (2)
• Labor market: international
2
experience (1)
• Political stability (1)
3
• Attractiveness for highly
• Personal safety – Berne,
qualified employees from
Geneva and Zurich (6)
foreign countries (1)
• Work motivation (1)
• Quality of infrastructure (2)
• R&D training (1)
• Quality of life – Geneva (5)
• Healthcare infrastructure (1)
• Purchasing power – Geneva (7)
• Global innovation index (3)
• Purchasing power – Zurich (7)
• Quality of life – Zurich (5)
• Credit standing (4)
• Nobel prizes per million
• Good relations between
residents (1)
employers and employees (2)
Sources:
1)
2009 IMD World Competitiveness Yearbook
2)
The Global Competitiveness Report 2009 – 2010
3)
Global Summary Innovation Index (GSII)
4)
Euromoney 2008
5)
Mercer Survey, Quality of Living Global City Rankings 2009
6)
Mercer Survey, Quality of Living Global City Rankings 2008
7)
UBS, Prices and Earnings: A Comparison of Purchasing Power Around the Globe, March 2008
Handbook for Investors 2010
9

1. An overview of Switzerland.
Nestled between the Alps and the Jura mountains, Switzerland
is a communications and transport center between northern
and southern Europe where European cultures and languages
overlap. No other country offers such great variety in so small
an area. The Swiss economy’s high degree of development exists
thanks to its liberal economic system, its political stability
and its close integration with the economies of other countries.
The state creates the necessary framework and only intervenes
when this serves the interests of society at large. Its
high quality education system and outstanding infrastructure
form the basis for the competitiveness of the Swiss economy.
Lake Geneva (Lac Léman) in the south-west is shared with
France, while Lake Constance in the north-east is shared with
Germany and Austria.
The Swiss portal
www.swissworld.org
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
1.1 Geography.
The total area of Switzerland is 41,285 km 2 . Characterized by
ranges of hills and mountains, rivers and lakes, Switzerland offers
a wide variety of landscapes in a small area – 220 km from north
to south, and 348 km from west to east. The Swiss Alps, the hilly
Mittelland region, which stretches from Lake Constance to Lake
Geneva, and the Swiss Jura, a long range of fold mountains, form
the three main geographical areas of the country. Due to its central
location, Switzerland is a place where different cultures intersect
and, at the same time, a communications and transportation hub
between northern and southern Europe.
Fig. 2: Map of Switzerland’s location
6 % of Europe’s fresh water supply is stored in the Swiss Alps,
which is why Switzerland is also known as the «reservoir of
Europe.» Switzerland has numerous rivers and almost 1,500 lakes,
the two largest of which are shared with neighboring countries:
10 Handbook for Investors 2010

1.2 Climate.
Switzerland’s climate is strongly affected by the nearby Atlantic
Ocean. The prevailing winds from the west bring damp, mild sea
air over to Switzerland. Cooling in the summer and warming in
the winter, they also bring sufficient precipitation all year round
in most areas. The Alps act as a clear climatic divider between
northern and southern Switzerland; as its weather comes primarily
from the direction of the Mediterranean, the south enjoys
much milder winters than the north. Temperatures in Switzerland
depend primarily on height above sea level. In the northern lowlands,
the average temperature in January is around 1 °C, and in
July around 17 °C, whereas on the southern plateau the corresponding
average temperatures are 2 – 3 °C higher.
Closeness of politics to the business community and to citizens
is achieved through the federal structure, in which many public
functions are executed at the cantonal or municipal level. These
in turn have a certain amount of autonomy and can thus implement
solutions which are designed to meet local requirements.
1.3.2 Separation of powers at the federal level
In accordance with the federal constitution, the Swiss people
are the «sovereigns» of the country – in other words, the highest
political body, responsible for electing parliament. Every citizen
with voting rights also has the right to participate in the shaping
of the constitution and the legal system by means of referendum
or initiative.
Swiss climate
www.meteoschweiz.ch
Languages: German, English, French, Italian
1.3 Political system.
1.3.1 Federal structure
Switzerland is a nation created by its own will and formed from
several ethnic groups with different languages and religions.
The modern Swiss state was founded in 1848. Before this time,
Switzerland consisted of a loose association of independent cantons.
The abbreviation CH for Switzerland, as found in Internet
addresses, for example, dates back to the official Latin name
«Confoederatio Helvetica.»
The state has a federal structure and is divided into three political
levels: municipal, cantonal and federal. The federal government
is responsible for everything assigned to it under the constitution,
such as foreign and security policy, customs and excise,
the monetary system, national legislation and defense. By global
comparison, the 26 cantons have a high degree of control.
Healthcare, education and culture are among the political areas
in which they have a great deal of influence. As small and flexible
political entities, the cantons also compete with each other in
various areas.
The Federal Assembly or parliament consists of two chambers:
the National Council, representing the people with 200 members,
and the Council of States, representing the 26 cantons with a
total of 46 members. The National Council is elected directly by
the people every four years; each canton forms one constituency.
Cantonal representation is based on population, although each
canton is entitled to at least one representative.
The federal government is known as the Federal Council, and it
operates as a collegial body. Each of its seven members, who
are elected by the Federal Assembly comprising the members of
both chambers, heads one of the seven departments (ministries).
The presidency of the government rotates between the Federal
Councilors on an annual basis.
The highest jurisdiction in Switzerland is enforced by the Federal
Supreme Court in Lausanne, the Federal Insurance Court in
Lucerne, the Federal Criminal Court in Bellinzona and the Federal
Administrative Court in Berne (from 2012 onwards in St. Gallen).
Handbook for Investors 2010
11

Fig. 3: Direct democracy
People
(«Sovereigns»)
Federal constitution
(basic law)
Government
Federal Council
(7 members, of whom 1 is
elected Federal President
for 1 year, each in turn)
Two-chamber parliament
National Council
(large chamber,
200 members)
Council of States
(small chamber,
46 members)
Federal Supreme Court
Federal administration
Ordinances
Federal laws
Budget
Election
Control (Audit Committee)
Proposal (people: initiative; government: draft bill;
parliament: motion regarding discharge of office)
Discussion (debate between the parliamentary
chambers: reaching consensus)
Resolution (laws are subject to mandatory or facultative
referendum)
Source: www.geschichte-schweiz.ch
1.3.3 Direct democracy and the concordance system
There is hardly any other country where the electorate has such
wide-ranging rights as it does in Switzerland. Citizens can request
that a change or addition be made to the constitution by means of
an initiative, or they may decide on parliamentary resolutions after
the event by means of a referendum. Switzerland’s long tradition of
democracy, its relatively small size and population, high levels of
literacy and a wide variety of media are all factors key to the functioning
of this special form of government. As a rule, the electorate
is called upon to vote on federal bills four times a year.
A unique feature of Swiss politics is the concordance system. For
decades, the most important political parties have put forward the
seven Federal Councilors in a form of coalition. Not only those who
win the elections have a seat in parliament; all parties are represented
proportionally by number of votes. Resolutions are reached
with varying majorities, depending on respective interests. Thus
as many groups as possible have the opportunity to express their
opinions on a topic and contribute to achieving a broad-based
compromise. This striving for consensus on the basis of the principles
of collegiality and concordance contributes significantly to
Switzerland’s political stability.
1.3.4 Political stability and social harmony
Studies on personal security and prosperity, social coherence and
political stability have shown that Switzerland regularly leads all
international comparisons in this regard. The Swiss attach great
importance to their independence.
12 Handbook for Investors 2010

Despite the close proximity of different cultures and language
groups, domestic stability is considerable. There is a high degree
of tolerance and personal freedom. The relationship between
management and labor is generally cooperative. Both sides are
committed to resolving issues by means of negotiation. Thanks to
this social harmony, the general level of prosperity in Switzerland
has been rising for decades.
Fig. 4: Political stability, 2008
Political orientation stable = 10, unstable = 0
1 Luxembourg 9.64
2 Switzerland 9.62
3 Singapore 9.40
4 Austria 9.38
5 Sweden 9.23
9 Ireland 8.82
10 Denmark 8.81
11 Netherlands 8.71
13 US 8.54
14 Germany 8.48
16 UK 8.34
18 France 8.21
19 Hong Kong SAR 8.16
22 Brazil 7.90
28 India 6.34
31 People’s Republic of China 6.12
34 Japan 5.87
39 Russia 5.33
45 Belgium 4.46
51 Italy 3.38
Source: 2009 IMD World Competitiveness Yearbook
Federal Department of Foreign Affairs
www.eda.admin.ch
Languages: German, English, French, Italian
1.4 Public finances.
Switzerland lives up to its reputation as a stable country. The
rate of inflation lies well below that in the EU states and the most
important industrialized nations. This also holds true for unemployment,
with the rate of those out of work regularly below 4 %.
Interest rates in Switzerland are also traditionally low thanks to a
high savings rate and large inflows of foreign money.
The public spending ratio measures expenditure by public administrations
as a percentage of gross domestic product (GDP).
It includes spending by public authorities and mandatory social
insurance. In Switzerland this ratio is 32.6 % (projection for 2008).
In 2008, most European countries had a much higher ratio of government
expenditure to GDP (France: 52.5 %; Sweden: 51.2 %;
Italy: 48.4 %; Germany: 43.4 %).
The country is in a healthy financial situation. This applies to the
financial budget of the central state, the federal government as
well as the cantons and local authorities. The aggregate budget
balance of all three levels is positive. The public deficit ratio of
1 % is significantly below the average of EU and OECD member
countries.
Swiss foreign policy
For further information see section 1.5.
National debt is also below that of most countries in Europe. Total
public sector debt amounts to 59 % of GDP (2006). The national
debt ratio remains below the EU average and that of the US.
Swiss Federal Finance Administration
Swiss political system
www.admin.ch
Languages: German, English, French, Italian
www.efv.admin.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
13

1.5 Neutrality.
In terms of foreign policy, Switzerland acts in accordance with the
principle of neutrality. However, this does not in any way mean
that it is an outsider on the world stage: Switzerland has been a
member of the UN since 2002 and also plays an important role in
the UN’s specialized organizations. Furthermore, Switzerland has
always played and still plays an active part in important economic
organizations, such as the European Free Trade Association
(EFTA).
21 % of the population is of foreign nationality. Although in the
past migration to Switzerland was primarily the preserve of those
who were less socially able, since the introduction of agreements
with the EU/EFTA enabling the free movement of persons,
the country has increasingly been attracting foreign nationals
from higher social classes, particularly highly qualified staff from
Germany.
Swiss Federal Statistical Office (FSO)
For more than 500 years, Swiss politics has been dominated by
the words of St Nicholas of Flüe (1417 – 1487): «Don’t get involved
in other people’s affairs.» Switzerland has been neutral since
1515, as also acknowledged by the great European powers after
the Napoleonic Wars in 1815. No other country in Europe can
look back on such a long tradition of neutrality. Since the end of
the Cold War, Switzerland has relaxed its definition of neutrality.
As the role of NATO changed and it started to perform more
peacekeeping missions, Switzerland signed up to the NATO Partnership
for Peace in 1996. Thanks to its neutrality, Switzerland
often acts as a mediator. In some cases, Swiss diplomats also
represent the interests of countries which have no official contact
with each other. Switzerland offers its neutral territory as a location
for meetings and conferences of particular political delicacy.
1.6 Population.
The permanent resident population of Switzerland is around
7.5 million. The proportion of those aged between 20 and 39 is
26.8 %, with 16.4 % aged 65 and over and 21.5 % aged under 20.
Life expectancy is one of the highest in the world: 79.4 for men
and 84.2 for women. Residential areas remain relatively decentralized
and therefore not overly crowded: more than two-thirds
of the population lives in the five largest cities (Zurich, Geneva,
Basel, Berne, Lausanne) and their greater metropolitan areas.
There are four official national languages: German (native language
for 64 %), French (20%), Italian (7%) and Romansh (1%). In northern,
eastern and central Switzerland, the prevailing language is
German, but in everyday conversations different German dialects
are used. French is spoken in the west of the country, French and
German in some parts of the Mittelland, Italian in the south (Ticino),
and Romansh in certain parts of the canton of Grisons.
www.statistik.admin.ch
Languages: German, English, French, Italian
1.7 Cosmopolitan and international
outlook.
1.7.1 Languages and cultural heritage
Most Swiss nationals speak at least one foreign language, which
they learn in elementary school. English is also increasingly
included in the curriculum at an early stage. Due to the country’s
openness – including in terms of immigration – the range of
languages actually spoken and used for communication is wide. In
international business, English is very much in evidence alongside
the respective national languages, and is used by many managers.
Over a quarter of Switzerland’s resident population was of foreign
nationality at birth. The co-existence of various language groups
and different religions, and the large proportion of foreign residents
result in a high degree of openness and tolerance. This makes it
easier for foreign companies to conduct business from Switzerland.
Although Europe is Switzerland’s most important business partner,
it also has very close relationships with other markets, particularly
the US and Asia. The financial centers of Zurich and Geneva in
particular are melting pots of diverse cultures. In terms of culture,
too, Switzerland has a tradition of tolerance and openness. Its neutrality
means it has access to all countries, and it also welcomes
reciprocal contact. This diversity has made it easy for global
companies and numerous international organizations to settle in
Switzerland.
14 Handbook for Investors 2010

1.7.2 Direct investments and Swiss corporations abroad
Switzerland’s exposure to global markets is among the strongest
of any country’s. In 2007 direct investments abroad totaled
CHF 740 billion, or 145 % of GDP. In comparison, Belgium’s direct
investments abroad in the same year added up to 135 %, and
those of the Netherlands 111 %. At just 57 %, Ireland’s direct
investments abroad were much lower. Swiss companies with
direct investments abroad employ around 2.4 million staff in their
foreign subsidiaries and operating units, and they are also important
employers in Switzerland.
Fig. 5: Globalization
Individual rankings
Rank overall Economic
integration
Personal
contacts
Technology Political
commitment
Singapore 1 2 3 15 40
Hong Kong SAR 2 1 1 17 71
Netherlands 3 4 16 6 8
Switzerland 4 11 2 7 28
Ireland 5 6 4 13 5
Denmark 6 5 13 5 7
US 7 71 40 1 51
UK 12 18 21 9 6
Belgium 15 7 7 22 16
Germany 22 45 34 16 19
France 25 31 29 24 3
Japan 28 70 65 12 15
Italy 34 56 38 26 11
Russia 62 49 60 46 52
China 66 43 67 56 65
Brazil 67 69 71 39 42
India 71 66 59 63 69
Source: Foreign Policy: The Globalization Index 2007
Handbook for Investors 2010
15

1.7.3 International organizations
It is because of its independence and commitment to greater
international understanding that Switzerland serves as a platform
for many international organizations, including the UN with its office
in Geneva. In addition, well over 200 non-governmental organizations
which act as advisors to the UN are based in Switzerland.
Fig. 6: International organizations headquartered in Switzerland
AITIC Agency for International Trade Information and Cooperation Geneva www.aitic.org
IBE/UNESCO International Bureau of Education/United Nations Educational, Scientific and Geneva www.ibe.unesco.org
Cultural Organization
ITCB International Textiles and Clothing Bureau Geneva www.itcb.org
BIS Bank for International Settlements Basel www.bis.org
CERN European Organization for Nuclear Research Geneva public.web.cern.ch
OSCE Court Court of Conciliation and Arbitration within OSCE Geneva www.osce.org/cca
EBU European Broadcasting Union Geneva www.ebu.ch
EFTA European Free Trade Association Geneva www.efta.int
FIFA Fédération Internationale de Football Association Zurich www.fifa.com
FIS International Ski Federation Thun www.fis-ski.com
ICRC International Committee of the Red Cross Geneva www.icrc.org
ILO International Labour Organization Geneva www.ilo.org
IOC International Olympic Committee Lausanne www.olympic.org
IRU International Road Transport Union Geneva www.iru.org
ISO International Organization for Standardization Geneva www.iso.org
ISSI International Space Science Institute Berne www.issi.unibe.ch
ITU International Telecommunication Union Geneva www.itu.int
OTIF Intergovernmental Organization for International Carriage by Rail Berne www.otif.org
UEFA Union of European Football Associations Nyon www.uefa.com
UNHCR Office of the United Nations High Commissioner for Refugees Geneva www.unhcr.org
UNOG United Nations Office at Geneva Geneva www.unog.ch
UPU Universal Postal Union Berne www.upu.int
WADA World Anti-Doping Agency Lausanne www.wada-ama.org
WHO World Health Organization Geneva www.who.int
WIPO World Intellectual Property Organization Geneva www.wipo.int
WMO World Meteorological Organization Geneva www.wmo.int
WTO World Trade Organization Geneva www.wto.org
WWF World Wide Fund for Nature Gland www.wwf.org
Source: Federal Department of Foreign Affairs (FDFA)
16 Handbook for Investors 2010

1.8 Switzerland in figures.
Fig. 7: Switzerland in figures
General
Currency Swiss franc (CHF)
Time zone CET = UTC + 1
International dialing code +41
National day
August 1st
Economy
Key figures 2008
GDP (nominal) in CHF billion 532.1
Per capita income in CHF 69,109
GDP growth 1.6 %
Rate of inflation 2.4 %
Unemployment rate 2.6 %
Imports in billion CHF 186.9
Exports in billion CHF 206.3
Key figures 2007
Budget surplus, in % of GDP +0.8
National debt, in % of GDP 55.5
Tax rate, in % of GDP 30.1
Direct investments in CHF million 2007
Direct investments abroad 740,472
Direct investments in Switzerland 379,894
Capital exports abroad 59,612
Capital imports into Switzerland 59,113
Workforce abroad 2,350,238
Workforce in Switzerland 227,539
Population
Permanent resident population in thousands 7,593.5
Population density per km 2 172.0
Age groups in %
0-19 21.5 %
20-39 26.8 %
40-64 35.3 %
65-79 11.7 %
80 and over 4.7 %
Proportion of foreign nationals 20.5 %
Average number of children per woman 1.4
Life expectancy at birth (years)
Men 79.2
Women 84.2
Migration balance 5.2
Religion
Roman Catholic 42 %
Evangelical Reformed 35 %
Other 23 %
Languages
German 63.7 %
French 20.4 %
Italian 6.5 %
Romansh 0.5 %
Other 9.0 %
Geography
Area in km 2 41,285
Borders in km 1,881
Number of lakes 1,484
Highest mountain (in m): Dufourspitze, Valais 4,634
Largest glacier: Aletsch, Valais 117 km 2 /24 km
Largest lake (in km 2 ): Lake Geneva 582
Second largest lake (in km 2 ):
539
Lake Constance
Capital city
Berne
Largest metropolitan areas, population in
2007
thousands
Zurich 1,132
Geneva 504
Basel 490
Berne 346
Lausanne 317
Politics
Form of government
Parliamentary federal state since
1848, direct democracy
Cantons
20 full cantons, 6 half cantons
Municipalities 2,715
Source: UBS, Economic Research; UBS outlook; Swiss Federal Statistical Office; Swiss National Bank (SNB); www.myswitzerland.com
Handbook for Investors 2010
17

2. Economic structure.
One of the most liberal and competitive economies in the
world, Switzerland has always maintained close economic
ties with other countries. A secure legal system and long-term
stable fundamentals for investors, relatively little regulation
and the proximity to research institutions make it the location
of choice in Europe for businesses offering high quality
products and services.
Small and medium-sized enterprises (SMEs) dominate the Swiss
economic landscape. More than 99 % of companies have fewer
than 250 full-time employees. Staff are highly motivated, possess
a keen sense of responsibility and are very loyal to their company.
These typical Swiss characteristics are responsible for the quality
and service ethos in both the industry and the service sector.
Switzerland is also one of the world’s leading innovators.
2.1 Gross domestic product and
industry structure.
Switzerland’s per capita gross domestic product is the fifth-largest
in the world, or eighth-largest when adjusted for purchasing
power. At USD 64,642 the per capita gross domestic product was
considerably higher than the EU average in 2008. Switzerland
outranks the UK by 49 %, and Germany and France by 45 % and
40 %, respectively.
The service sector generates some 70 % of the gross domestic
product. Comprising 28 % of GDP, the industry sector is also an
important mainstay of the economy, with the key sectors being
chemicals, capital goods and banking. The Swiss economy is
strongly geared towards exports – as a percentage of GDP, its
foreign trade is among the highest in the world. The EU plays
a key role here, accounting for 62 % of exports and 79.5 % of
imports.
Fig. 8: 2008 (nominal) per capita gross domestic product in USD
1 Luxembourg 110,766
2 Norway 93,829
3 Qatar 65,832
4 Switzerland 64,642
5 Denmark 62,306
6 Ireland 61,494
7 Netherlands 52,871
11 Belgium 47,249
12 US 46,189
13 France 46,070
16 Germany 44,444
17 UK 43,352
18 Italy 38,812
19 Japan 38,424
20 Singapore 37,597
23 Hong Kong SAR 30,890
37 Russia 11,791
44 Brazil 8,211
54 People’s Republic of China 3,260
57 India 1,049
Source: 2009 IMD World Competitiveness Yearbook
18 Handbook for Investors 2010

Fig. 9: Industry structure, percentage of employees
Industry Employees (3rd quarter 2008)
in 1,000s in %
Total (excluding agriculture and
forestry)
3,947.0 100 %
Sector II total 1,059.7 26.90 %
Construction industry 306.5 7.77 %
Engineering (including computer
108.0 2.74 %
production)
Metals industry 106.9 2.71 %
Medical devices, precision
98.3 2.49 %
instruments, watches
Chemical industry and plastics 95.9 2.43 %
Food, tobacco and beverages 63.0 1.60 %
Other fabrication industries and
52.8 1.34 %
trade
Wood and paper industry 51.6 1.31 %
Printing and publishing 46.2 1.17 %
Electricity generation 40.6 1.03 %
Energy and water supply 25.6 0.65 %
Automotive manufacturing 21.1 0.53 %
Textiles, clothing and shoes 18.5 0.47 %
Sector III total 2,888.1 73.20 %
Trade; repair of motor vehicles/
610.8 15.48 %
used goods
Healthcare and social services 473.9 12.01 %
Consulting services 380.8 9.65 %
Transport and data transmission 255.8 6.48 %
Education 246.7 6.25 %
Gastronomy 234.8 5.95 %
Lending and insurance industry 214.2 5.43 %
Public administration, military,
171.3 4.34 %
social security
Other services 168.3 4.26 %
IT services 72.8 1.84 %
Real estate and rentals 40.0 1.01 %
R&D 17.7 0.45 %
Source: Swiss Federal Statistical Office (FSO), Employee Statistics
(Beschäftigungsstatistik, BESTA)
Fig. 10: 2009 competitiveness ranking Global Competitiveness
Index (GCI)
1 Switzerland 5.60
2 USA 5.59
3 Singapore 5.55
4 Sweden 5.51
5 Denmark 5.46
7 Germany 5.37
8 Japan 5.37
10 Netherlands 5.32
11 Hong Kong SAR 5.22
13 UK 5.19
16 France 5.13
18 Belgium 5.09
21 Luxembourg 4.96
25 Ireland 4.84
29 China 4.74
48 Italy 4.31
49 India 4.30
56 Brazil 4.23
63 Russia 4.15
Source: World Economic Forum, The Global Competitiveness Report
2009 – 2010
Fig. 11: 2006 Global Innovation Index
1 Finland 0.76
2 Sweden 0.74
3 Switzerland 0.71
4 Japan 0.70
5 Singapore 0.69
7 US 0.67
8 Germany 0.63
9 Denmark 0.59
10 Netherlands 0.58
12 UK 0.57
14 France 0.56
17 Belgium 0.52
20 Ireland 0.48
21 Luxembourg 0.47
23 Hong Kong SAR 0.39
24 Russia 0.39
26 Italy 0.36
35 China 0.27
41 Brazil 0.22
46 India 0.17
Source: www.proinno-europe.eu, Global Summary Innovation Index (GSII)
Handbook for Investors 2010
19

World Economic Forum
www.weforum.org
Language: English
2.2 International integration.
As the Swiss domestic market is small and the country is lacking
in natural resources, Swiss companies have been forced to seek
and cultivate abroad what are often their key markets since the
advent of industrial production. Approximately half of Switzerland’s
GDP is generated from the export of goods and services. As a
result, the country has become an important player in world trade.
It is also among the leading exporting countries in terms of exported
goods and services per capita.
Fig. 12: Trade balance as a % of GDP (2007)
1 Singapore 24.27
2 Norway 17.15
3 Malaysia 15.50
4 Hong Kong SAR 13.54
5 Switzerland 13.35
6 People’s Republic of China 10.99
7 Luxembourg 9.26
11 Netherlands 7.67
12 Germany 7.46
14 Russia 5.91
15 Japan 4.87
23 Belgium 1.67
25 Denmark 1.11
28 Brazil 0.11
30 India – 1.01
31 France – 1.18
34 Italy – 2.43
37 UK – 3.75
39 US – 5.30
41 Ireland – 5.40
Source: 2009 IMD World Competitiveness Yearbook
2.2.1 Goods and services trade
Europe is Switzerland’s most important market by far. Four-fifths
of all imports and three-fifths of all exports are traded with the
EU. Germany has traditionally been Switzerland’s most important
buyer and also supplier, while Italy and France are its second and
third most important suppliers. The US is Switzerland’s secondlargest
customer, followed by Italy and France. Newly industrialized
nations account for nearly 10 % of exports, and approximately
5 % of imports come from developing countries.
The classic example of a successful export-oriented branch of
industry is what is known as Switzerland’s «secret automotive
and aircraft industry»: a little known network of highly specialized
manufacturing companies and problem-solvers providing components
for a range of areas, from precision and micro-mechanics
to materials technology, plastics and textiles. As the leading partners
in technological innovations, these Swiss companies have
been able to position themselves as reliable suppliers of quality
and precision products.
Switzerland is a co-signatory of the WTO Agreement and has
continually championed market liberalization through its free
trade agreements, as a member of the EFTA and through bilateral
agreements with the EU. As a result of its consistent market
liberalization policy, Switzerland has become an efficient trading
center and a market of economic significance – not only relative
to its market size.
Fig. 13: Imports and exports by countries (2008)
In billion CHF
155.6
EU & EFTA
132.0
Non-European
16.7
industrialized countries
30.2
7.5
Transition countries
11.4
Newly industrialized
7.7
countries
21.7
9.3
Imports
Developing countries
17.6
Exports
Source: www.zoll.admin.ch
20 Handbook for Investors 2010

2.2.2 Direct investments
In addition to being very closely linked to foreign markets through
the trade of goods and services, Switzerland has also built strong
international relationships through investments due to its location,
lack of natural resources and the relatively small size of its
domestic market. This can be seen in the ratio of Swiss direct
investments abroad to nominal GDP, which was 145 % at the end
of 2007. Switzerland is the ninth-largest foreign direct investor
in the world in absolute terms, and measured against GDP, it
ranks fourth. It is the seventh-largest direct investor in the US;
15.4 %, or CHF 113,736 million, of all Swiss direct investments
are made in the US. Switzerland itself is also an attractive location
for foreign investors, in particular for investors from the EU
(71.6 %, CHF 271,854 million) and the US. Direct investments by
US investors in Switzerland total CHF 69,628 million or 18.3 %.
Fig. 14: Direct investments
Direct investments at end of 2007
Swiss direct investments
abroad
Foreign direct investments
in Switzerland
in million CHF in % in million CHF in %
Total 740,472 100.0 % 379,894 100.0 %
EU 291,697 39.4 % 271,854 71.6 %
UK 57,076 7.7 % 17,039 4.5 %
Germany 49,153 6.6 % 28,257 7.4 %
Netherlands 33,968 4.6 % 83,880 22.1 %
Luxembourg 31,963 4.3 % 22,779 6.0 %
France 29,373 4.0 % 34,701 9.1 %
Italy 23,131 3.1 % 5,931 1.6 %
Spain 13,038 1.8 % 1,403 0.4 %
Austria 8,049 1.1 % 57,707 15.2 %
Rest of Europe 52,333 7.1 % 2,484 0.7 %
Offshore financial centers 35,235 4.8 % n.a.
Russian Federation 5,639 0.8 % n.a.
North America 147,956 20.0 % 72,966 19.2 %
US 113,736 15.4 % 69,628 18.3 %
Canada 34,220 4.6 % 3,338 0.9 %
Central and South America 164,732 22.2 % 29,249 7.7 %
Brazil 34,689 4.7 % n.a.
Offshore financial centers 117,877 15.9 % 27,077 7.1 %
Asia, Africa, Oceania 83,756 11.3 % 3,341 0.9 %
Japan 13,682 1.8 % 932 0.2 %
Singapore 13,547 1.8 % n.a.
China 4,754 0.6 % n.a.
Hong Kong SAR 4,505 0.6 % n.a.
Taiwan 1,110 0.1 % n.a.
India 2,751 0.4 % n.a.
Australia 11,893 1.6 % n.a.
Source: SNB, 2007 direct investments, www.snb.ch
Handbook for Investors 2010
21

2.3 Key industry clusters.
From an economic perspective, clusters can be defined as
networks of manufacturers, suppliers, research facilities (e.g.
universities), service providers (e.g. designers and engineers) and
related institutions (e.g. chambers of commerce) that have a certain
regional proximity to one another and which are formed via
a common relationship based on trade along a value chain (e.g.
automotive manufacturing). The members of these clusters are
connected through supplier or competitive relationships or common
interests. These networks are referred to as clusters only if
there is a critical mass of companies near to one another whose
activities complement or are relative to another along one or more
value chains. Only then can a growth pool be formed which also
attracts suppliers and specialized service providers and creates
competitive advantages for all companies involved.
Switzerland has several of these industry clusters, which are also
important on an international scale. The key industry clusters in
Switzerland will be briefly described over the next few pages. The
figures provided are for reference purposes only, as the clusters
sometimes overlap.
2.3.1 Life sciences, chemicals and pharmaceuticals
Extremely successful global conglomerates such as Novartis,
Roche, Syngenta and smaller companies form a unique industrial
cluster in Northwestern Switzerland, making the city of Basel and
the surrounding region the national and international location of
choice for life science, pharmaceutical and chemical companies.
The chemical, pharmaceutical and biotechnology industry is the
driving force behind Northwestern Switzerland’s economy, and
Basel’s in particular. The average growth rate in the life sciences
sector in the tri-country metropolitan area (Switzerland, France,
Germany) over the last 15 years was 7.1 %. The industry employs
28,000 people, 81 % of whom are in Switzerland. The nominal
gross added value amounts to EUR 5.3 billion.
Owing to the ripple effect of pharma giants Novartis and Roche,
biotech clusters have formed in four regions – namely Basel,
Zurich, around Lake Geneva and, to a lesser degree, Ticino. At
the end of 2007 the industry tallied 220 companies employing
some 14,700 people (148 biotech development companies and 72
biotech supplier companies; the subsidiaries of foreign companies
and biotech businesses of large pharma and agrochemicals
companies are not included). Such a concentration of biotechnology
companies is not found anywhere else in the world. Over half
of Swiss biotech firms are small companies with fewer than 20
employees. They profit from the geographical proximity to large
companies both in Switzerland and its neighboring countries.
Some well-known global players headquartered in Switzerland
that are industry leaders in Europe are Actelion, Amgen, Biogen
Idec, Crucell and Merck Serono.
SGCI Chemie Pharma Schweiz
www.sgci.ch
Languages: German, English, French
Biotechnology in Switzerland
www.swissbiotech.org
Language: English
2.3.2 Medical technology
The concentration of medical technology companies in Switzerland
is also unusually high. The medtech sector consists of around
500 to 700 companies, the majority of which are located in the
Berne, Basel and Zurich metropolitan areas as well as in Western
Switzerland. Between 200 and 300 companies manufacture their
own products, up to 70 % of which are then exported. Investment
in research and development, growth rates and profitability are all
above average. In Europe, only Germany and the UK have more
employees in this industry. The largest employer is Synthes, ahead
of the Johnson&Johnson subsidiary DePuy, and the diagnostics
division of Roche. Other global Swiss companies are Ypsomed,
Sonova (hearing aids) and Straumann (dental implants). Some
major foreign corporations worth mentioning are Stryker, Zimmer,
Medtronic and Smith & Nephew.
22 Handbook for Investors 2010

The medical technology industry is one of the fastest growing in
Switzerland: no other country employs more people in this industry
relative to the working population. With an average annual
growth rate of around 10 % in recent years, today approximately
45,000 people in 700 companies generate CHF 20 billion in
revenue. Two-thirds of this revenue comes from exports. Almost
half (45 %) of the revenue produced in the Swiss market is generated
by the manufacturers of medical technology products, which
underscores the importance of Switzerland as a production site
for medical technology.
Based on its contribution to GDP, the added value of the medtech
industry is easily double the average for the Swiss economy.
Dachverband der Schweizerischen Handels- und Industrievereinigungen
der Medizinaltechnik (umbrella organization
of the Swiss trade and industry associations for
medical technology)
www.fasmed.ch
Languages: German, French
CHF 70 billion. This amounts to about 15 % of the entire Swiss
GDP. Some 200,000 people are employed in the financial sector,
which is about 5 % of all employed persons in Switzerland. Of
this number, 100,000 work in banks, 54,000 at insurance companies
and the rest at other financial institutions. The establishment
of the Swiss Finance Institute – a collaborative effort between
financial institutions and leading Swiss universities – in 2006 has
helped bolster education and financial research.
From an international perspective, the Swiss banking center is
highly regarded and extremely competitive. Its core competency
is asset management for private clients. In addition to the two
major globally active banks, UBS and Credit Suisse, there are numerous
regional and specialized institutions. There are some 150
foreign banks in the country, and 58 % of the assets managed in
Switzerland come from abroad.
The key factors for success and the basic conditions for the
insurance industry include a generous per capita income and
a strong need for security, a solidly structured old age pension
system, an open and internationally networked insurance centre,
a credible regulatory environment and international know-how in
the reinsurance business.
Medical Cluster
Swiss financial market forum
www.medical-cluster.ch
Languages: German, English
www.forumfinanzplatz.ch
Languages: German, French
Swiss Medtech
Swiss Finance Institute
www.swiss-medtech.org
Languages: German, English
www.swissfinanceinstitute.ch
Language: English
2.3.3 Financial services
The Swiss financial center is an important element of the economy,
as well as a world-class cluster. In Switzerland there are some
330 banks, 260 insurance companies and 2,700 pension funds.
The majority of the financial institutions are located in Zurich,
Geneva, Basel and Lugano. In 2006, the direct value added by
banks came to about CHF 48 billion, and CHF 22 billion by
insurance companies, for a combined total of approximately
2.3.4 Machinery, electrical engineering and metals industry
The machinery, electrical engineering and metals industry (MEM)
represents the largest industrial sector and holds a key position in
the Swiss economy with 350,000 employees. The MEM industry
contributed 19.3 % to GDP in 2007, while its share of added value
amounted to 9.4 %. In almost every division of the machinery
industry, Switzerland’s export volumes rank among the highest in
the world. Approximately 80 % of MEM industry products are ex-
Handbook for Investors 2010
23

ported, and the industry contributes 39.6 % to total Swiss exports.
Large metal and machinery sector companies with well-known
names such as Saurer, Rieter, Schindler and ABB are present in
almost every canton. Particularly in the cantons of Zurich/Aargau
and Ticino/Valais, in the Rhine Valley and in Central Switzerland,
growth is amongst the strongest in the world. Most companies
focus on innovation and quality and maintaining and expanding
their global market position in order to compete with cheaper
locations. Today this branch of industry is able to compete on the
international stage thanks to well-advanced restructuring and the
use of new technologies.
similar technologies for their products, in particular the medical
technology industry; in recent years its presence in this region
has been expanding sharply. A cluster that is strongly geared to
micro-mechanics and optics has also been formed in Eastern
Switzerland and the Berne area.
Today, the Swiss electrical engineering, precision mechanics and
watch industry provide employment for almost 140,000 staff at
5,000 workshops, roughly equal to 3 % of the people employed in
Switzerland.
Swiss machinery, electrical engineering and metals industry
www.swissmem.ch
Languages: German, English, French, Italian
Federation of the Swiss Watch Industry FH
www.fhs.ch
Languages: English, French
2.3.5 Watch industry
The Swiss watch industry is primarily located in the Jura region
stretching from Geneva to Schaffhausen (called the «watchmaker
belt»), with individual sites in Mittelland, Ticino and Valais. The
Swiss watch industry makes products whose high degree of
technification makes possible a strongly demarcated division
of labor. As a result, the sector generally comprises small and
medium-sized businesses, averaging 60 employees per company.
Around 630 companies employ nearly 49,000 people (as of 2007).
94 % of all employees and businesses are located in the seven
cantons of the Jura region, resulting in a watch industry cluster.
By focusing on the luxury segment, Swiss watchmakers have
been able to expand their outstanding global market position by
over 50 % in recent years.
The geographical concentration of the watch industry has given
rise to a «precision cluster,» which extends along the Jura from
the Basel area to northern Vaud and down to Geneva, while the
cities of Geneva, Biel and La Chaux-de-Fonds themselves are
three watchmaking centers. Companies such as the Swatch
Group, Rolex SA, Richemont SA and the LVMH Group are headquartered
here.
The availability of highly qualified staff with professional knowhow
has resulted in the relocation to this area of more and more
companies outside the watchmaking industry which require
2.3.6 Information technology
Since the 1960s Switzerland has ranked second worldwide in IT
use (after the US). As a percentage of the population, it has more
computers in use than all other European countries. The Swiss
economy relies heavily on computers. Swiss products are based
on IT components of all sorts, ranging from those used for banking
services to chemical and machinery products. According to
the International Data Corporation, more than CHF 9 billion per
year is spent on IT in Switzerland.
In the Zurich-Lake Constance area, well-known companies
from the IT sector, such as the IBM research lab or the Microsoft
Development Center for Collaboration Technologies, have
settled around the Swiss Federal Institute of Technology Zurich,
its research facilities and the University of Zurich. Google opened
its first European development center in Zurich in 2004 precisely
because of its proximity to these universities. Other IT centers
have emerged in Berne and Lucerne.
More than 110,000 people are employed in the IT sector. Swiss IT
companies such as Oerlikon and Kudelski are leaders in their
markets. Some of the largest employers in the sector are foreign
companies, such as Siemens, EDS Corporation, Dell, HP, Reuters
and Orange. One important criterion encouraging foreign IT firms
to settle in Switzerland is the extremely well educated, technically
experienced and often multilingual workforce.
24 Handbook for Investors 2010

Dachorganisation Informatik- und Telekomsektor (umbrella
organization for information and communication technology)
www.ictswitzerland.ch
Languages: German, French
Energie-Cluster
www.energie-cluster.ch
Languages: German, French
2.3.7 Environmental technology
The term environmental technology includes all technologies, processes
and products (goods and services) that reduce environmental
pollution, conserve natural resources and maintain living
conditions. According to a report by the Swiss Federal Statistical
Office (FSO), money spent on the environment by the public
and private sectors in Switzerland totals some CHF 6 billion or
approx. 1.7 % of GDP. Around one-third of these costs goes on
waste management. About one-quarter is spent on preventing
water pollution and another quarter on preventing air pollution.
The remainder goes to other environmental causes. According
to the results obtained from an analysis conducted by the FSO,
approximately 50,000 people were employed in the environmental
sector in Switzerland in 1998, equivalent to 1.3 % of the total
workforce. Revenue for the environmental sector amounted to
CHF 9.5 billion. Compared to the figures for 1990, the number of
employees in the environmental industry had tripled and revenue
doubled by 1998.
Federal Office for the Environment (FOEN)
www.bafu.admin.ch
Languages: German, English, French, Italian
Swiss Association for Environmental Technology
www.svut.ch
Languages: German, English, French
Technology and know-how transfer for eco solutions
www.eco-net.ch
Language: German
2.3.8 Commodities trading
Switzerland is one of the world’s most important commodities
trading platforms. Around one-third of global trade in wheat,
oilseed and rice, as well as a substantial amount of crude oil
business, is transacted via Geneva, while Zug is a hub for trade in
mining products. At first glance, such a prominent position may
seem surprising because Switzerland is a land-locked country
with very few natural resources. But because of its central location,
it has been a crossroads for various trade routes since the
early days of international trade in coffee and cotton. Later the
Swiss financial center became a hub for international trade due
to its traditionally advantageous location. In addition to comparatively
low taxes, trading companies value its central location,
good infrastructure and connections with foreign countries.
According to a study by the Geneva Trading and Shipping Association,
the industry’s annual profit in Geneva alone amounts
to CHF 2.1 billion. Also important for the Swiss economy are the
numerous commodities-related services based here, such as
insurance companies, law firms, consulting companies, fiduciary
companies and freight and security businesses. Major Swiss
banks and cantonal banks, as well as various foreign banks,
have specialized in financing commodities trading in the regional
hubs. They finance the purchase of raw materials, guarantee the
seamless processing of transactions and offer protection against
operational and credit risks.
Handbook for Investors 2010
25

Swiss Trade
www.vsig.ch
Languages: German, English, French
Geneva Trading & Shipping Association (GTSA)
www.gtsa.ch
Languages: English, French
2.3.9 Headquarters functions
Switzerland is a vital center for the global and regional headquarters
of foreign companies. While European firms have their global
headquarters in Switzerland, US companies tend to open their
regional headquarters here. There are more than 6,500 foreign
companies in Switzerland today, of which over 1,000 are regional
or global headquarters. The number of companies that have
moved their European headquarters to Switzerland has risen in
recent years. More than 180 headquarters have been relocated
to Switzerland in the last ten years alone, including 89 Forbes
2000 companies such as IBM, General Motors, Kraft Foods,
Phillip Morris, Procter & Gamble, Dow Chemicals, Amgen, Baxter,
DuPont, Nissan and Google.
Some key criteria in the choice of location include availability of
qualified staff, a favorable tax environment, a high standard of
living and an advantageous geographical location. Neutrality in an
economic sense is also important – all the major European markets
are comfortable with a Swiss main office. 90 % of the foreign
companies located here would choose Switzerland again and
praise the excellent transport and communication infrastructure
and the high standard of technology. Other advantages include
proximity to research facilities and clients, the stable political and
economic environment and reliable double taxation agreements.
Switzerland is also perfectly suited as a test market because it
offers the widest possible variety in a small area.
26 Handbook for Investors 2010

3. Economic framework.
Free competition and trade and the protection of intellectual
property are the cornerstones of economic success and
make Switzerland attractive to both domestic and foreign
companies. Efficiently organized administrative processes
guarantee security for planning and day-to-day operations,
while progressive environmental laws promote sustainability.
Switzerland is an extremely attractive location for global firms.
The main reason for this is its liberal economic environment and
an economic policy based on the free market.
Fig. 15: Economic freedom, 2006
Global ranking Rating
Hong Kong SAR 1 8.94
Singapore 2 8.57
New Zealand 3 8.28
Switzerland 4 8.20
UK 5 8.07
Chile 6 8.06
Canada 7 8.05
USA 8 8.04
Australia 9 8.04
Ireland 10 7.92
Denmark 13 7.78
Netherlands 16 7.65
Germany 17 7.64
Luxembourg 21 7.58
Japan 27 7.48
Belgium 44 7.20
France 46 7.19
India 77 6.59
China 93 6.29
Brazil 96 6.16
Russia 101 6.12
Source: Cato Institute, Economic Freedom of the World: 2008 Annual Report
Handbook for Investors 2010
27

3.1 International exchange of
goods and services.
The Swiss economy is characterized by a high degree of international
integration, with half of the country’s GDP generated
abroad. This is only possible thanks to the highly effective crossborder
movement of goods and persons.
Unlike most other countries Switzerland uses a system of customs
clearance based on weight. This specific customs duty is
therefore levied on products from non-EU/EFTA countries on the
basis of weight. As a result, Swiss customs duties are usually
lower than those of other countries. This favors the importation
of high-quality technical components, which weigh very little but
are extremely valuable.
3.1.1 Free trade agreements, WTO and elimination of trade
restrictions
In addition to the EFTA Convention and the Free Trade Agreement
with the European Union (EU), Switzerland currently has a network
of 20 free trade agreements with countries outside the EU and
is also a member of the WTO. It applies the most-favored-nation
clause in trade with all WTO member states and is generally committed
to eliminating trade restrictions worldwide.
In joining the WTO Switzerland has also undertaken to convert
most non-tariff trade barriers into customs duties. Apart from a few
exceptions (primarily agricultural products), domestic products are
not protected against international competition. There is no actual
anti-dumping law. There are essentially no volume restrictions on
the importation of processed products. Imports and exports of
industrial goods basically enjoy full duty and quota exemption on
the European markets thanks to the free trade agreements with
the EU and the EFTA.
Duty and quota exemption does not mean that customs clearance
is not necessary, but this is not an obstacle. Thanks to PCs and
the Internet it is now a largely automated process conducted via
the IT applications e-dec Import and NCTS Export.
3.1.2 Customs and excise
Although Switzerland has been a member of the Schengen Area
since the end of 2008, it is not part of the European Customs
Union. As a result, customs controls remain in place. The most
important document for customs clearance is the customs declaration,
which must be accompanied by the exporter’s invoice
(indicating the weight) and confirmation of origin. A certificate of
origin is required if one wishes to benefit from preferential duty
rates or if the goods are to be re-exported.
In line with other countries Switzerland levies taxes and duties
at its borders, such as the mileage-related heavy vehicle toll
(MRHVT), the tobacco excise tax and the CO 2
levy. At a standard
rate of 7.6 %, VAT is much lower than in neighboring countries
(Germany: 19 %, France: 19.6 %, Austria: 20 %, Italy: 20 %).
Goods that are only intended to be held in Switzerland temporarily
in intermediate storage can be stored without customs
clearance and duty unpaid in bonded warehouses. The goods are
therefore in transit between the border and the bonded warehouse.
The subsequent exportation of the goods is then subject
to the customs tariff of the importing country. The goods so
stored may not be processed, or they become liable for normal
customs clearance. Bonded warehouses are public facilities.
They are operated by private warehousing companies and are
open to all interested parties. There are bonded warehouses on
all key transport routes, at major freight depots and airports, and
in particular in border areas. Open bonded warehouses, meanwhile,
are used for storing goods that have not been cleared
through customs on a company’s own premises. They are usually
operated by shipping companies and are becoming increasingly
important. There are now over 150 open bonded warehouses.
The used household effects of persons moving to Switzerland
that are intended for their continued personal use are exempt
from customs duty. At the time of importation, the completed
official form must be submitted to the Swiss customs office.
Clearance of household effects must take place during customs
office opening hours.
The Swiss Federal Customs Administration sees itself as a
service organization. It provides information for customers on
simplified procedures and rules and advises on practical issues
such as proof of origin, processing arrangements and VAT at the
time of importation.
28 Handbook for Investors 2010

Customs information
www.zoll.admin.ch
Languages: German, English, French, Italian
Customs duties and taxes database
www.osec.ch
Search under: Worldwide Customs Tariffs
Languages: German, English, French, Italian
3.1.3 Rules of origin
Raw materials and component parts that are imported from third
countries can acquire Swiss origin status and consequently
circulate freely in Europe if the added value created in Switzerland
is between 60 % and 80 % of the finished product’s selling price,
depending on the product. This regulation is of interest because
high-tech products often have a low weight but a high product
value. They can therefore be imported cheaply into Switzerland,
be processed and then be exported duty-free to Europe. If goods
are imported in this way from a country outside the EU/EFTA area
and transformed in Switzerland in such a manner that they acquire
Swiss origin status, no duty is payable when the goods are
exported to a EU/EFTA country. The cantonal sections (chambers
of commerce) of Economiesuisse (Swiss Business Federation)
provide information on the details and issue the corresponding
certificates of origin.
Origin guidelines
www.ezv.admin.ch
Languages: German, French, Italian
3.2 Protection of free competition.
Switzerland’s economic system is based on the principles of
the free market, and existing competitive constraints are being
eliminated. Free and fair competition is strengthened by a strict
Cartel Act, in which cartels are not illegal but abuses are prosecuted.
Since 1995, Switzerland’s cartel legislation has largely
been harmonized with EU regulations. The Internal Market Act
ensures greater competition and the elimination of protectionist
regulations at cantonal and municipal levels. The Competition
Commission can intervene if there are grounds for suspecting
unacceptable restrictions on competition. It also investigates
whether mergers have negative effects on free competition and
supplies the authorities with recommendations on promoting effective
competition.
3.3 Protection of intellectual
property.
The protection of intellectual property rights is well developed
in Switzerland. A comprehensive system of patent, trademark,
design and copyright protection guarantees that the results of innovation
and creativity are protected at national and international
levels. Patent applications, trademark or design registrations can
be submitted to the Swiss Federal Institute of Intellectual Property
(Eidgenössisches Institut für Geistiges Eigentum, IGE). The key
point for internationally active companies is that worldwide protection
can therefore be achieved through a single entry.
The IGE, the agency responsible for commercial protective rights
and copyrights, is a center of competence for all aspects of
patents, trademarks, designs, topographies of semiconductor
products, copyrights and other related protective rights. Initial
information about protective rights titles registered in Switzerland
can be accessed via the IGE’s own electronic protective rights
register. As a member of the WTO, Switzerland implements the
provisions of the WTO/TRIPS Agreement.
The Swiss Federal Institute of Intellectual Property makes information
from the trademark, patent and design register and on
protected topographies available free of charge on the Swissreg
database. Swissreg contains Swiss trademarks and applications
for registration, but not international trademarks that could also
lead to protective consequences in Switzerland. These international
trademarks are registered with the World Intellectual
Property Organization (WIPO) in Geneva.
Handbook for Investors 2010
29

Fig. 16: Guide for innovative and creative minds
Idea
Protection possible?
Ideas as such cannot be protected, but in certain circumstances their concrete form can be:
• Technical solutions can be protected by a patent (e.g. heatable ski boots)
• The name of a product or a logo can be protected by registering a trademark (e.g. Ricola)
• A product form can be protected by depositing a design (e.g. Colani bottle)
• Literary works, art and computer programs are protected by copyrights
Discoveries, aesthetic forms and theoretical or business systems are not seen as inventions in
Switzerland and therefore cannot be patented. An invention expands mankind’s technical
possibilities while a discovery only expands its knowledge.
Keep it secret
• Ideas should be kept absolutely secret (invention, design, trademark), especially if they are to be
protected
• Rights are reserved for whoever registers first
Do your research
• Is the idea new?
• Similar products that have already been produced
• Search on the Internet, in technical and patent literature, at trade exhibitions and in product catalogs
Realistic project? • Market demand • Realizable
Product development • Prototype • Trademark/product name
• Business plan
• Legal restrictions
• Starting a company
• Don’t infringe on the rights of others
• Internet presence
Protect
• File an application with the Swiss Federal Institute of Intellectual Property (IGE), www.ige.ch
– Patents
– Trademarks
– Designs
– Copyrights
• Define your protective rights strategy: what do you want to protect, how do you want to monitor,
defend or assign your protective rights (e.g. by selling or licensing them)?
• Establishing and managing a company
Marketing
Source: Swiss Federal Institute of Intellectual Property (IGE)
30 Handbook for Investors 2010

Swiss Federal Institute of Intellectual Property (IGE)
www.ige.ch
Languages: German, English, French, Italian
• International patent: The Patent Cooperation Treaty (PCT),
which Switzerland has ratified, enables inventors to submit an
international registration which then has the same effect as a
national registration in all named member states. International
registrations can be submitted to the IGE in English.
Protective rights register
www.swissreg.ch
Languages: German, English, French, Italian
It takes an average of three to five years between an application
being filed and the patent being granted. Patents expire after a
maximum of 20 years. For topographies or three-dimensional
structures of semiconductor products, the protection period is ten
years. A patent costs CHF 200 for the application and CHF 500
for the investigation. Annual renewal fees are payable starting five
years after the date of filing.
World Intellectual Property Organization (WIPO)
Switzerland is one of the most active countries in the OECD in
terms of the number of patent applications per inhabitant.
www.wipo.int
Languages: English, French, Spanish, Chinese, Russian
Europe's network of patent databases
3.3.1 Patents
Inventions that solve a technical problem by technical means can
be protected with a patent. To be eligible for a patent, the invention
must meet three basic criteria:
• Commercial application: The invention must be commercially
usable, actually realizable and repeatable.
• Novelty: An invention is considered novel when it is not already
state-of-the-art.
• Non-obviousness: The invention must not be obviously (for an
expert) related to the state of the art.
Ideas, lottery or accounting systems, therapeutic, surgical or
diagnostic procedures, animal breeds and plant species cannot
be patented.
There are three ways to protect an invention with a patent application
effective in Switzerland:
• Swiss patent: With national registration, the patent protection
extends to Switzerland and the Principality of Liechtenstein.
• European patent: The European Patent Convention (EPC)
enables applicants to obtain protection in the member states of
the EPC, including Switzerland, through a standardized patent
investigation and granting procedure.
www.espacenet.com
Languages: German, English, French
Patent attorneys
www.ige.ch
Languages: German, English, French, Italian
3.3.2 Brands
It is advisable to register trademarks and brands in good time in
both the home market and the most important export markets. In
most cases, application for trademark protection in foreign countries
follows on from the trademark’s registration in Switzerland.
Before registering the planned trademark in the trademark register
and the commercial register, it is important to find out whether
other trademarks exist that are identical or so similar as to cause
confusion. Specific searches can be conducted online, and all the
data needed for the registration of Swiss trademarks can also be
entered and submitted online.
Handbook for Investors 2010
31

Registrants in Switzerland have the option, based on national
registration and pursuant to the extended protection offered by
the Madrid Agreement on trademarks and the Madrid Protocol, to
extend trademark protection to other member countries.
The registration fee for ten years of protection in Switzerland is
CHF 550, or CHF 350 when registering online (an e-trademark).
Once the ten-year protection period has expired, it can be extended
as many times as desired. In straightforward cases, an
application to register a trademark can be checked and approved
within three to four months.
Trademark searches
www.ip-search.ch
Languages: German, English, French, Italian
Registering trademarks
e-trademark.ige.ch
Languages: German, French, Italian
Trademark lawyers
www.ige.ch
Languages: German, English, French, Italian
3.3.3 Designs
New commercially manufactured designs with two-dimensional or
three-dimensional features of an aesthetic nature can be protected
by means of registration. This is a simple procedure in Switzerland.
Protection lasts for a maximum of 25 years, comprising five fiveyear
periods. Based on the Hague Agreement concerning the
International Deposit of Industrial Designs, designs and models
can also be registered internationally. Because Switzerland has
ratified this agreement, the registrant acquires protection for
Switzerland as well.
3.3.4 Copyright
Intellectual creations of literature and art with a unique character
can be protected by means of copyright. This includes literature,
music, paintings, sculptures, films, operas, ballets and mimes,
but also software. A work is protected by copyright as soon as
it is created. There is no requirement to apply for protection or
lodge the work, and no register exists. In Switzerland, copyright
protection expires 70 years after the death of the creator, except
for software, which is only protected for 50 years.
3.4 Product provisions and product
liability.
For reasons of health and safety, environmental and consumer
protection and to comply with international and national standards,
medicines, cosmetics, cleaning agents, electrical appliances,
measuring and weighing equipment, heating systems, pressure
containers and motorcycles are subject to certain regulations
when imported into and sold in Switzerland.
The law regulates which particular conformity assessment procedures
shall apply, depending on the product’s hazard potential.
The procedures range from self-imposed checks (e.g. for
machines) to assessments by government-approved independent
conformity assessment centers (e.g. for pressure containers) to
government licensing (e.g. for medicines).
These days most countries impose a raft of technical regulations
and very few products escape the net. At the federal level in Switzerland,
these regulations are contained in more than 30 laws and
more than 160 ordinances. In addition, a few technical regulations
still exist at the cantonal level.
Mutual recognition agreements (MRAs) are a politically important
tool for removing technical trade barriers in the state-regulated
sector and are recognized by the World Trade Organization. If the
product regulations in two states are of a comparable standard, a
conformity assessment conducted under the exporting country’s
regulations is sufficient to allow the product to be distributed in
the other country. Switzerland’s MRA with the European Union is
the most economically important example (CE marking (Conformité
Européene)).
32 Handbook for Investors 2010

In the main, Swiss product liability regulations are comparable
with those in the European Union – the manufacturer is liable for
damage caused by defective goods, irrespective of whether the
manufacturer itself is negligent. In Switzerland, liability applies to
all products put into circulation from 1994 onwards. The health
and safety requirements for technical equipment are governed
by ordinance. In terms of technical standards, Switzerland has
largely adopted European Union regulations, thereby removing
any major barriers to exporting to the EU in this area.
The following sections give further details on the regulations relating
to a number of important product categories. Due, however,
to the large number of laws and ordinances in existence, it is essential
that detailed information be sought in specific cases.
3.4.1 Foodstuffs
The Swiss Foodstuffs Ordinance (Lebensmittelverordnung, LMV)
contains very strict regulations on the information that must be
declared. All ingredients must be named and listed on the packaging
or labels of pre-packed foodstuffs in descending order of
quantity. Foodstuffs not on the federal list must be authorized by
the Federal Office of Public Health (FOPH). Approval is mandatory
for products where an ingredient contains more than 1 % of
genetically modified organisms. It is forbidden to market foodstuffs
as having a therapeutic effect. Products with a therapeutic
effect are medicines and must be authorized by Swissmedic (see
Section 3.4.2).
Federal Office of Public Health (FOPH)
Mutual recognition agreements (MRAs)
www.seco.admin.ch
Languages: German, French
www.bag.admin.ch
Languages: German, English, French, Italian
Permitted foodstuffs
Government approvals
www.e-service.admin.ch/bewilligungen
Languages: German, French
www.admin.ch
Search under: Law on foodstuffs
Languages: German, English, French, Italian
Official test centers – Switzerland, EU
www.seco.admin.ch
Search under: SAS (accredited centers)
Languages: German, English, French, Italian
3.4.2 Pharmaceutical products
The manufacture and sale of medicines is subject to mandatory
approval in Switzerland. It takes on average six months to register
a new pharmaceutical product with Swissmedic, the Swiss Agency
for Therapeutic Products, making Switzerland’s registration process
one of the quickest in the world. Normal evaluation of a
license application for a human medicine costs a maximum of
CHF 25,000 (CHF 60,000 under the fast track procedure).
Swiss Association for Standardization
www.snv.ch
Languages: German, English, French
The registration requirements are largely comparable with those
in the EU, which makes it simple to apply for registration in
Switzerland and the EU simultaneously. Swiss registration enjoys
high-level international standing, thanks to the country’s exceptional
scientific reputation, its strict criteria and the large number
of renowned clinical-testing hospitals. The fast track procedure
enables vital medicines (e.g. to treat AIDS or Alzheimer’s) to be
brought to market very quickly (three-four months maximum),
despite rigorous testing.
Handbook for Investors 2010
33

Swiss Agency for Therapeutic Products
www.swissmedic.ch
Languages: German, English, French, Italian
3.4.3 Medical devices
The Medical Devices Ordinance is the means by which the European
Medical Devices Directive on active implants, classical medical
devices and in-vitro diagnostics is incorporated into Swiss law.
This ordinance enables the free trade in medical devices of Swiss
manufacturers within the European Union. Switzerland applies
the same regulations on medical devices as the EU. A medical
equipment supplier wishing to sell its product in Switzerland must
be able to prove to the authorities that its product meets the
fundamental requirements of the EU Directive as well as national
requirements.
Medical devices bearing CE marking from an EU test office are
also deemed to comply with Swiss law, provided all the product
information is provided in three languages (German, French, Italian)
and the distributor is registered in Switzerland. A manufacturer in
Switzerland may use CE marking for its medical devices and sell
them on the Swiss market or export them to the EU.
Swissmedic has taken over from the Federal Office for Public
Health as the issuer of export certificates for medical devices for
non-EU states.
3.5 Land use planning and
environmental protection
3.5.1 Building and zoning
Thanks to progressive legislation on land use planning and environmental
protection, densely populated economic areas can
exist in harmony with rural and agricultural land. Because of high
population densities, building development and environmental
awareness have always gone hand in hand. Service and industrial
buildings are erected in special zones. Building and zoning regulations
are governed by cantonal law, and a building permit must be
obtained. The duration and scope of this process depend on the
type of investment being planned. In the interests of occupational
safety, industrial buildings, for example, require both planning
consent and an operating license.
The duration of the building permit process depends on the type
and complexity of the project. For straightforward building projects,
such as commercial/industrial projects with no particular
level of difficulty or requirement for supplementary investigations
or special approvals, it usually takes two-three months. This
assumes that there are no grounds for appeal or protests. The
process may vary from canton to canton.
The cantonal economic development agencies provide information
on commercial land development and available commercial
buildings, as well as on the necessary administrative steps. Their
job also involves initiating and, where necessary, coordinating this
process.
Medical Devices Ordinance
www.admin.ch
Languages: German, English, French, Italian
Federal Office for Land Development (Bundesamt für
Raumentwicklung)
www.are.admin.ch
Languages: German, French, Italian
Environmental considerations of building and zoning
www.bafu.admin.ch
Search under: building and zoning
Languages: German, English, French, Italian
34 Handbook for Investors 2010

3.5.2 Environment
Swiss environmental legislation largely conforms to EU rules.
Environmental law and the protective measures this gives rise to
are based on the principle of cooperation. In cooperation with
the business community, solutions are developed to meet both
economic and environmental considerations. The measures instigated
are seen as exemplary around the world. When erecting
and operating industrial and commercial sites, there are a variety
of federal and cantonal decrees to consider. The federal laws on
controlling water pollution and protecting the environment, nature
and cultural heritage are especially important. The Environmental
Protection Act sets forth regulations on air and soil contamination,
noise, vibrations, waste and environmentally harmful substances.
Based on the principles of «precaution» and «polluter pays,» this
act requires environmental damage to be kept to a minimum and
the costs of preventing damage to be borne by the polluter. Emissions
are limited by means of regulations on standards, building,
equipment, traffic and operations, although the technology to
be employed is not prescribed. Companies are granted a specific
period of time to undertake remedial action, thereby allowing
them to determine how and when they make the necessary
investments.
Federal Office for the Environment (FOEN)
www.bafu.admin.ch
Languages: German, English, French, Italian
Overview of environmental law
www.bafu.admin.ch
Search under: Overview of environmental law
Languages: German, French, Italian
Environmental impact tests are conducted for projects involving
the planning, erection or modification of installations that could
have a serious impact on the environment. Although these tests
are a tool for protecting the environment, they only apply to specific
projects as part of the regular building and planning consent
process. Projects that require an environmental impact test are
listed in the relevant ordinances. Such projects include transport
systems, power generating plants and high-polluting industrial
plants.
Handbook for Investors 2010
35

4. Switzerland and Europe.
Culturally and geographically, Switzerland lies at the heart of
Europe. Although it is not a member of the European Union,
it shares close economic and political ties with its European
neighbors. A solid foundation of bilateral agreements and a
dynamic European policy form the basis for a deep-rooted
political partnership and a substantial amount of economic
integration, which benefit both the Swiss economy and the
financial center, as well as the EU.
4.1 Trade and direct investments.
Switzerland and Europe share close economic ties. As the destination
for 62.0 % of Swiss exports and with a share of 79.5 %
of Swiss imports, the EU is by far Switzerland’s most important
trading partner. For its part, Switzerland is the EU’s third-largest
customer (7 % of all exports) after the US and Russia, and the
sixth-largest supplier of goods (5 % of all imports). 39.4 % of
Swiss direct investments are made in the EU. Some 583,000 EU
nationals currently work in Switzerland, making up 19 % of the
workforce. Conversely, 415,000 Swiss live in EU countries.
With the exception of agricultural and food products, there are
no restrictions on trade between Switzerland and the members
of the EU. Goods with a certificate of origin from one of the 31
member states of the EU and EFTA (Switzerland belongs to the
latter, along with Iceland, Liechtenstein and Norway) can circulate
freely without quotas and customs barriers. In addition to the free
exchange of goods with the EU, there is also a strongly liberalized
labor market (such as for specialists, researchers and managers),
and somewhat liberalized trade in services.
Eurostat Statistical Office of the European Communities
www.epp.eurostat.ec.europa.eu
Languages: German, English, French
36 Handbook for Investors 2010

4.2 Political and economic
cooperation.
For numerous Swiss companies, including branches of foreign
firms, the European market is more important than the domestic
market. Various agreements to liberalize the market create almost
equal access to the European common market under stable framework
conditions. These agreements make it possible for firms from
Switzerland to better tap and work a market of almost 500 million
consumers. With the extension of these bilateral agreements to the
new EU member states, Switzerland gains access to the growth
markets of eastern Europe.
The bilateral agreements between Switzerland and the EU have
been broadly expanded. Various barriers to market access were
eliminated by the Free Trade Agreement of 1972 and the Bilateral
Agreements I of 1999. Bilateral I includes agreements covering
technical barriers to trade, public procurement, the free movement
of persons, agriculture, research, and overland and air transport.
Bilateral II, the second round of more extensive agreements of
2004, includes additional economic advantages as well as crossborder
cooperation in other political areas. The following sections
explain the most important agreements and their significance.
European site of the Federal Administration
www.europa.admin.ch
Languages: German, English, French, Italian
4.2.1 Free movement of persons
Thanks to the free movement of persons, it has become easier
for EU/EFTA citizens to live and work in Switzerland. Employees,
self-employed persons and persons without gainful employment
who have adequate financial resources have a right to a residence
permit (L or B) and in many areas enjoy the same treatment as
Swiss nationals. Service providers (employees sent by a foreign
employer or self-employed persons) may work in another country
for up to 90 days per calendar year. For citizens of the original 15
EU member states and Malta and Cyprus, controls on wages and
other working conditions and quotas have been lifted, nor is preference
given to Swiss nationals any longer. The free movement of
persons also works the same on the other side of the fence – Swiss
nationals can live and work in the EU.
This freedom of movement is reinforced by the mutual recognition
of vocational qualifications and coordination of social insurance
benefits, making it easier for the business community to recruit
employees in the EU region and to use education and training
facilities there. The agreement boosts the efficiency of the labor
market and promotes the availability of highly qualified personnel.
This freedom also applies to the new members of the EU. But for
the eight eastern European countries that joined in 2004, restrictions
on immigration will remain in place until April 30, 2011 at the
latest. For the states of Bulgaria and Romania, which joined in
2007, immigration restrictions entered into force on June 1, 2009
and will remain in place for seven years. There is also a special
protection clause that applies to these two countries for a further
three years. Appropriate transition arrangements will help control
and stem the flow of immigration, while accompanying measures
to counter wage and social dumping also apply.
4.2.2 Schengen Agreement
The Schengen Agreement grants Switzerland access to the EU’s
security cooperation tools. The agreement abolishes the systematic
identity checks at the borders between Schengen countries,
while at the same time reinforcing the collaboration between
the courts and the police. The Schengen visa is also valid for
Switzerland. Tourists from India, China, Russia or other countries
that require a visa no longer need an additional Swiss visa for a
short visit to Switzerland during their travel through Europe, which
increases Switzerland’s attractiveness as a vacation destination.
4.2.3 Elimination of technical barriers to trade
For most industrial products, conformity evaluations, such as
tests, certificates and product approvals, are mutually recognized.
Re-certification upon export to the EU is no longer necessary because
product inspections by Swiss testing institutes recognized
by the EU are sufficient. Accordingly, double inspection according
to Swiss and EU requirements is eliminated. In areas where EU
and Swiss regulations differ and two conformity certificates are
still required, both can be issued by the Swiss testing institute.
This process simplifies administrative procedures, reduces costs
and strengthens the competitive position of the export industry.
Handbook for Investors 2010
37

4.2.4 Research
Swiss research institutes, universities, the private sector and
individuals can fully participate in all of EU’s Framework Research
Programs, providing the country with scientific, technological and
economic benefits. The areas of research that fall under the 7th
Framework Research Program include information and communication
technologies, healthcare, energy, nanotechnology and the
environment. Now basic research is also supported at the European
level. Private industry is able to participate as well, which
means Swiss researchers can implement and manage their own
projects. Small and medium-sized Swiss companies with experience
in international cooperation will have unhampered access to
EU know-how, which they can utilize in the market.
4.2.5 Rail, road and air transport
The bilateral agreements with the EU have regulated the opening
of passenger and freight transport by road and rail. Charges
based on the «polluter pays» principle were introduced at the
same time. Network access in the EU is increasing the competitiveness
of the railways and opening up new market opportunities
for Swiss transport companies. Swiss airlines have access to
the liberalized European air transport market, subject to mutual
concessions, putting them on a more or less equal footing with
their European counterparts. Duty-free sales at Swiss airports or
on flights to and from Switzerland are still available.
4.2.6 Public procurement
Based on the comprehensive plurilateral agreements between
the 40 current member states on the public procurement of the
World Trade Organization of April 15, 1994 (GPA), an international
request for a proposal for the procurement of goods and services
and construction projects by certain clients over a certain amount –
termed the threshold value – must be made in order to promote
transparency and competition within public procurement. With
the EU agreement on public procurement, the scope of application
of the GPA of the federal government, cantons and sectors has
been extended to areas that are not covered by the list of obligations
of the EU and Switzerland. Now the agreement extends to
the districts and communities and certain sectors (telecommunications,
rail transport, energy and private clients in the sectors of
water, electricity, local transit, harbors and airports) which operate
on the basis of exclusive rights. Public law sectors are already
subject to GPA regulations. The 50 % origin clause and the requirement
that a foreign bid must be lower by 3 % to be successful in
Switzerland have been eliminated.
As liberalization progresses, the telecommunications sector and
rail freight (by the Swiss) on standard gauge rail are now no longer
subject to the regulations. Federal and cantonal requests for
proposals are posted on an electronic information system. In light
of the considerable expenses incurred by the public sector in the
EU and Switzerland, this further opening of the procurement market
is creating opportunities for the export industry (e.g. machine
construction) and the services sector (e.g. for engineering and
architecture firms). The heightened competition among providers
at reduced prices is leading to considerable savings for the states
submitting the orders.
Public procurement in Switzerland
www.simap.ch
Languages: German, English, French, Italian
4.2.7 Trade in agricultural products
The agreement on processed agricultural products governs trade in
products from the foodstuffs industry (e.g. chocolate, cookies and
pasta). The EU does not impose import or export duties on trade
with Switzerland. In response, Switzerland has reduced its import
and export duties accordingly. There is free trade in sugar and in
products which do not contain any raw materials besides sugar,
which are relevant to agricultural policy. The simplification of technical
regulations will be beneficial to consumers and will increase
opportunities for exporting quality agricultural products. Currently
under negotiation is a comprehensive agreement on the agricultural
and foodstuffs sector, which should fully open the markets for
agricultural products and foodstuffs for both sides. The agreement
would lift both tariff barriers to trade (such as duties and quotas) as
well as non-tariff barriers (such as various product regulations and
import requirements).
4.2.8 Taxation of savings income
In order to tax the savings income of EU citizens living in Switzerland,
the country operates a system of tax retention on savings
income at a rate which is being incrementally increased to
35 %. Three-quarters of the receipts from this tax are paid out to
EU countries. This withholding tax guarantees banking secrecy.
Related companies with their principal base in Switzerland, as well
as subsidiaries in EU member states, no longer pay withholding tax
on payments of dividends, interest and license fees. This increases
Switzerland’s appeal as a business location.
38 Handbook for Investors 2010

4.3 The euro.
Even though the official currency of Switzerland is the Swiss franc,
the euro is an accepted form of payment at practically all hotels and
in many businesses. Swiss banks and exchanges offer euro accounts,
and cash withdrawals in euros are possible at most ATMs.
The Swiss financial center is set up to conduct all bank transactions
in euros. Due to its location in the heart of the European Monetary
Union and the fact that the EU is its largest trading partner, the euro
is extremely important for Switzerland. This is particularly the case
in the tourism sector and for companies active in the import/export
business.
Handbook for Investors 2010
39

5. Establishing and managing a company.
Establishing a company can be done quickly and easily. Numerous
official and private organizations assist entrepreneurs
in selecting the appropriate legal form for their company and
can provide advice and support. The federal government’s
various websites offer a wide range of information on all
aspects of the company formation process – from business
plan to official registration.
5.1 Corporate structures.
Economic freedom, which is guaranteed under the Swiss Constitution,
allows anyone, including foreign nationals, to operate a business
in Switzerland, to form a company or to hold an interest in
one. No approval by the authorities, no membership of chambers
of commerce or professional associations and no annual reporting
of operating figures are required to establish a business. However,
foreign nationals must have both work and residence permits
in order to conduct a business personally on a permanent basis.
Swiss law distinguishes between the following types of business
entities: partnership-type unincorporated companies (sole proprietorship,
limited partnership or general partnership) and capitalbased
incorporated companies (stock corporation or AG, limited
liability company or GmbH). The newly created «limited partnership
for collective investment» (KkK) corresponds to the «limited
partnership» form common in English-speaking countries. The
legal form referred to as GmbH & Co. KG, which is common in
Germany and Austria, does not exist in Switzerland. Approximately
50 % of Swiss companies operate under the AG and GmbH legal
forms (the proportion of GmbHs is on the rise).
The appropriate form of business entity for a foreign company
establishing a location in Switzerland depends on many factors,
including the nature and time horizon of the business, general
legal and tax conditions, and the strategic goals of management
(headquarters, production facility, sales office, financial or
service company, etc.). Companies and private individuals from
foreign countries are allowed to determine the legal form that is
right for their business. This requires careful evaluation, in which
tax considerations play a crucial role. It is therefore advisable to
engage an advisor or consultant familiar with the Swiss legal and
tax system at an early stage in the process.
The following basic options are available for establishing a business
in Switzerland:
• Forming an unincorporated or incorporated company
• Setting up a branch office
• Acquiring an existing company in Switzerland (either unincorporated
or incorporated)
• Formation of a joint venture (unincorporated or incorporated
company)
• Forming a strategic alliance with or without an equity interest
The most common choices for a foreign company locating in
Switzerland are subsidiaries (in the form of a stock corporation or
limited liability company, i.e. an AG or GmbH) and branch offices.
The newly created limited partnership for collective investment is
also an attractive option for risk capital.
40 Handbook for Investors 2010

The following criteria are crucial when selecting the right form of
business entity:
• Capital: organization or incorporation expenses, capital needed
and minimum capital required
• Risk/liability: the higher the entrepreneurial risk or financial
investment, the more advisable it is to select a limited liability
form of company
• Independence: freedom of action may be restricted depending
on the legal form
• Taxes: the business income and assets of the company or
owner(s) are taxed either separately or together, depending on
the legal form
• Social security: certain social insurance plans are obligatory,
voluntary or non-existent depending on the legal form
Swiss government SME portal
capital is determined in advance and subdivided into shares. The
AG is an appropriate legal form not just for large companies but
also for small and medium-sized businesses. It is the customary
legal form for holding companies and financial enterprises.
The AG’s supreme body is the board of directors. It consists of one
or more members, who are not required to be shareholders. There
are no requirements regarding the nationality or legal residence
of the directors. At least one member (of the board of directors or
the executive board) authorized to represent the company must
reside in Switzerland. The compensation paid to the members
of an AG’s board of directors varies widely depending on the
industry, size of the company and sales revenue. The average fee
in Switzerland for a member of the board of directors in companies
with up to 1,000 employees is about CHF 19,000. The most
common forms of compensation are annual lump-sum payments
and reimbursement of expenses.
www.kmu.admin.ch
Languages: German, French, Italian
AG
Swiss Fiduciary Association
www.kmu.admin.ch
Languages: German, French, Italian
www.stv-usf.ch
Languages: German, English, French, Italian
Swiss Chamber of Fiduciaries
www.treuhand-kammer.ch
Languages: German, French
5.1.1 Stock corporation (AG)
The stock corporation – Aktiengesellschaft (AG) in German, Société
anonyme (SA) in French and Società anonima (SA) in Italian
– is a joint stock company (corporation limited by shares) similar
to a corporation in the United States or a public limited company
in the UK. It is the most important and most common type of
business entity in Switzerland. In addition, it is often chosen by
foreign companies as the legal form for their Swiss subsidiaries.
The AG is a distinct legal entity (with its own legal personality),
and its liability is limited to company assets. The registered share
5.1.2 Limited liability company (GmbH)
Under the new «GmbH Act,» which took effect in 2008, a limited
liability company (GmbH in German, Sàrl in French and Sagl in
Italian) is now considered a separate business entity with its own
legal personality. It can be formed by one or more individuals or
commercial companies, and its stated capital (nominal capital)
is specified in advance. Each shareholder has an interest in the
nominal capital in the form of one or more nominal shares having
a nominal value of at least CHF 100. The nominal capital must total
at least CHF 20,000 and must be fully paid in. A nominal share
can be easily transferred in writing. The formation of a limited
liability company and the costs involved are similar to the formation
of a corporation. Only one founder is required.
As a consequence of the revision of Swiss corporation law, the
GmbH is enjoying increasing popularity as an alternative to the
stock corporation. The GmbH is an attractive type of business
entity and is proving itself to be a more viable form than the AG
for small and medium-sized companies. A GmbH does not have
a board of directors. This reduces structural costs to a certain
degree but also places primary responsibility for the company
Handbook for Investors 2010
41

Fig. 17: Overview of legal forms
Formation
requirements
Purpose
Company
name
Legal status
Entry in the
commercial
register
Founders
Executive
bodies
Sole proprietorship General partnership Joint stock company
(AG)
Self-employment,
economic activity as a
means of permanent
gainful employment
Small businesses, activities
carried out by single
individuals (e.g. artists)
• Last name of the
owner (with or without
first name)
• Additional words possible
(activity, invented
name, etc.)
Sole property of the
firm's owner
Mandatory for businesses
pursuing commercial
aims (otherwise: optional)
One individual is the sole
proprietor
Signing of articles of
partnership (informal)
If no commercial activity
is pursued, the partnership
does not become
a legal entity until it is
entered in the commercial
register
Small, permanent businesses
centering on
specific individuals
• Last name of at least
one partner with a
suffix indicating the
relationship between
the partners
• Additional words possible
(activity, invented
name, etc.)
Public act of signing
when company is
founded, adoption of articles
of incorporation or
association, appointment
of a board of directors,
appointment of auditors
(unless dispensed with
pursuant to CO 727a II)
Entry in the commercial
register
Suitable for almost all
types of for-profit businesses
• Freely chosen (personal
names, activity,
invented names, etc.)
• The legal form must
be included in the
company name
Limited liability
company (GmbH)
Public act of signing
when company is founded,
adoption of articles
of incorporation or association,
appointment of
a board of management
and representatives,
appointment of auditors
(unless dispensed with
pursuant to CO 727a II)
Entry in the commercial
register
Small businesses centering
on individuals
• Freely chosen (personal
names, activity,
invented names, etc.)
• The legal form must
be included in the
company name
Branch office
Entry in the commercial
register
Business operation
that is legally part of a
main enterprise but has
a degree of economic
independence
• Same name as main
company (head office)
• Special additional
words allowed
• If the main company
is foreign: place in
which main company
is located, place in
which branch office is
located
• Specification of legal
form (branch office)
Partnership Legal entity Legal entity Branch office
Mandatory for businesses
pursuing commercial
aims
Two or more individuals
Becomes a legal entity
upon entry in the CR
At least one shareholder
(individual or legal entity)
None Partners • Annual general
meeting
• Board of directors (at
least 1 member)
Becomes a legal entity
upon entry in the CR
At least one shareholder
(individual or legal entity)
• General meeting of
shareholders
• Management (a minimum
of 1 member)
Auditors May be appointed May be appointed Yes, unless dispensed with under CO 727a II,
dependent on size: attainment of two of the three
following measures in two consecutive fiscal
years:
• Total assets of CHF 10 million
• Sales of CHF 20 million
• An average headcount over the year of 50 or more
Entry is mandatory
Main company (head
office)
• Bodies of the main
company
• Management by own
manager; authorized
representative residing
in Switzerland
May be appointed
42 Handbook for Investors 2010

Liability
Minimum
capital
Consulting
costs, formation,
registration,
notary
Advantages
Disadvantages
Sole proprietorship General partnership Joint stock company
(AG)
Unlimited liability of the
proprietor with personal
assets
Primary liability to the
level of company assets
(capital); subsidiary joint
and several unlimited
liability of each partner
with personal assets
Liability limited exclusively
to company
assets; each shareholder
is solely obliged to pay
in his/her/its share of the
share capital (payment
under subscription)
No stipulations No stipulations Minimum: CHF 100,000,
minimum paid in:
CHF 50,000
Limited liability
company (GmbH)
Liability limited exclusively
to company's
assets: optional limited
liability to make further
contributions according
to articles of association;
liability only for further
contributions linked to
own share in equity
Minimum: CHF 20,000
Branch office
Main company (head
office)
No separate equity is required
(capital resources
of foreign head office are
sufficient)
CHF 500 to 2,000 CHF 2,000 to 5,000 From CHF 4,000 From CHF 4,000 From CHF 1,000
• Simple and inexpensive formation procedure
• Few formal requirements
• Proprietors or partners themselves can act as the
governing bodies
• No double taxation, i.e. taxation of both company
profit and proprietor or partner income is avoided
(only the latter is taxed since the company is not
a legal entity)
• Well-suited to very small companies
• Partners have unlimited liability
• Ownership shares are difficult to transfer (only
through sale of individual assets or of the entire
company)
• No anonymity: equity holders must be registered
in the commercial register
• Access to the capital market is more difficult
• Must pay social insurance premiums
• Limited liability and risk capital
• Company shares are easily transferable
• Regulated representation rights
Foreign nationals may hold all stock or all shares
(but there must be at least one person resident in
Switzerland who can handle all legal matters)
Easier access to the capital market, although only
AGs can be listed on the stock exchange
Suitable for more capital-intensive businesses
The company is a Swiss company
• Anonymity of shareholders
– no disclosure
obligation
• Unlimited share capital
• Limitation of the
shareholders’ obligation
to contribute additional
capital
• Simple inheritance
arrangements
• Publication of annual
financial statements is
only required if the AG
has outstanding bonds
or is listed on the
stock exchange.
• Low minimum capital
requirement
• Some double taxation (taxation of company profits
and dividends)
• More complicated and more expensive formation
procedure; professional consultant recommended
• Amount of share
capital
• Shareholders have no
anonymity
• No separate equity
required
• Simpler and less
expensive to form
than a corporation (no
securities issue tax,
since no participation
rights are issued, and
no anticipatory tax on
the transfer of profits
since the branch office
is part of the main
company)
• The head office can
exercise influence
directly
• Profits of Swiss branch
office are exempt from
taxation in country of
head office (parent
company) under many
double-taxation agreements
• Foreign head office is
jointly liable for debts
of branch office
• Subsequent transformation
to a subsidiary
poses fiscal problems
• Not a Swiss legal
entity
Handbook for Investors 2010
43

on the shoulders of the managing director or directors (at least
one of whom must reside in Switzerland). Depending on their
size, GmbHs are subject only to limited auditing requirements.
Compared with AGs, they have the advantage of lower required
share capital but the disadvantage of a lack of anonymity. All
shareholders, including those who join the company later, are
publicly disclosed.
Investors and limited partners who want to establish a form of LLP
now have the option of establishing the company in Switzerland
and are no longer forced, as in the past, to set up their company
in Luxembourg, Ireland or the Channel Islands (specifically Jersey
and Guernsey). This has strengthened Switzerland’s status as
a financial center and created the conditions for an increase in
professional services for specialized risk capital, private equity
and even hedge fund managers in Switzerland.
Limited liability company (GmbH)
www.kmu.admin.ch
Languages: German, French, Italian
5.1.3 Branch office
A branch office is a business establishment that is legally part of a
principal enterprise on which it depends. In its own district, however,
it carries on the same activities as the principal enterprise on
a permanent basis and therefore enjoys a certain degree of economic
and business autonomy. The branch office is economically
independent but is legally dependent on the head office. It can
only be created in fact but cannot be formally established as a
separate legal entity. As soon as a branch office is formed, it must
be registered in the commercial register. As far as licensing, registration,
taxation and accounting records are concerned, a branch
is treated like any Swiss company. In order for a foreign company
to establish a branch office in Switzerland, it must have an authorized
representative whose legal residence is in Switzerland.
5.1.4 Limited partnership for collective investments
In order to establish a suitable legal form for providing risk capital,
the new Federal Act on Collective Investment Schemes (Collective
Investment Schemes Act or CISA) introduced the limited partnership
for collective investments (abbreviated as KkK in German or
SCPC in French), which corresponds to the limited liability partnership
(LLP) common in English-speaking countries.
As an instrument for risk capital investment, this new form of company
is reserved exclusively for qualified investors. In contrast to
the provisions of the Swiss Code of Obligations regarding limited
partnerships, according to which the partner with unlimited liability
must be an individual (and not a corporate investor), the liable
partner in a limited partnership for collective investments must be
a corporation.
Collective Investment Schemes Act (CISA)
www.admin.ch
Search for: Bundesgesetz KAG
Languages: German, French, Italian
5.1.5 Sole proprietorship and general partnership
The individually owned enterprise – sole proprietorship or
single-owner company – is the most popular legal form for small
businesspeople. It exists legally whenever an individual conducts
commercial activities alone or, in other words, operates a business
or a company. The owner of the sole proprietorship bears
the entrepreneurial risk and is liable for that risk with his or her
entire private and business assets. On the other hand, the owner
also has the sole power to determine business policy.
If the business is successful, it can be easily transformed into a
corporation. If it fails, liquidation is easier than for other legal
forms. The sole proprietorship does not need to be registered in
the commercial register unless annual sales exceed CHF 100,000.
If two or more individuals come together to operate a business
under a joint name in accordance with standard commercial practices,
this type of operation is called a general partnership.
A general partnership is created by a partnership agreement
between the participants. Since it (like a sole proprietorship) is not
a distinct legal entity, it is not required to pay taxes. Taxes
are paid by the individual partners. The partners have unlimited
joint liability for any business debts or obligations of the partnership
to the extent of their own assets. Entry in the commercial
register is required.
44 Handbook for Investors 2010

Sole proprietorship and general partnership
www.kmu.admin.ch
Languages: German, French, Italian
5.1.6 Joint venture
The joint venture is becoming more and more important as a form
of partnership. It is not regulated by law and is an appropriate
form for a joint activity with a Swiss partner. A joint venture is often
operated as a joint investment in a newly formed corporation
(a foreign supplier, for example, establishes a manufacturing or
sales company together with the Swiss seller). Joint ventures can
also be operated as an ordinary partnership in the case of small
projects (e.g. a research project for a limited time period).
5.1.7 Ordinary partnership
The ordinary partnership is a contractual association of several
individuals or legal entities for a business purpose that is not
required to be entered in the commercial register. Anonymity is
preserved but each partner is jointly and personally liable for the
joint project.
Ordinary partnership
www.kmu.admin.ch
Search for: Einfache Gesellschaft
Languages: German, French, Italian
5.2 Accounting.
The general accounting regulations in Switzerland are brief and to
the point. The accounts required for the type and scope of business
must be kept in an orderly manner and allow identification of
business assets and of receivables and payables associated with
business operations as well as operating results (profit or loss) in
each business year. The law requires that the income statement
(profit and loss account) and the balance sheet be drawn up annually
according to generally accepted accounting principles and
that they be complete, clear and easily understood. This means
that the accounting system can be based on any internationally
accepted standards (such as US-GAAP, IAS or FER).
Corporations (AGs) must meet detailed minimum requirements
concerning the structure of financial statements in order to
increase transparency. The annual financial statements must
include, as a minimum, a balance sheet and an income statement
with prior-year comparisons and explanatory notes. The annual
financial statements of subsidiaries, including in particular those
of listed companies, must be consolidated in a single set of group
financial statements if two of the following measures are reached
in two successive fiscal years:
• Total assets of CHF 10 million
• Annual sales of CHF 20 million
• An average headcount over the year of 200 employees
5.3 Auditing.
Annual financial statements are audited for correctness and accuracy
by independent auditors. A legal entity (fiduciary company
or audit association) may also serve as auditor. It must have the
proper qualifications and be independent. Under new legislation,
the duty to have accounts audited depends on the size and
economic importance of the corporation (AG) or limited liability
company (GmbH). Regular audits apply to companies that are
required to prepare consolidated financial statements and also
to companies listed on the stock exchange or if two of the three
measures below are reached in two successive fiscal years:
• Total assets of CHF 10 million
• Annual sales of CHF 20 million
• An average headcount over the year of 50 employees or more
If these conditions are not met, then the annual financial statements
are only subject to a limited audit (questioning of management,
appropriate detailed checks, analytical audit procedures,
etc.). The audit may also be dispensed with entirely, subject to the
approval of the shareholders, if the company has no more than an
average of ten full-time positions over the year.
Statutory audit requirement
www.kmu.admin.ch
Languages: German, French, Italian
Handbook for Investors 2010
45

5.4 Establishing a business.
5.4.1 Procedure
Parties who intend to establish a company in Switzerland can
move more quickly from the planning stage to implementation if
a clear and concrete business strategy has been worked out in
advance. Once the decision to locate in Switzerland has been
made, the economic development agency of the selected canton
can help to coordinate the project locally until the start of operations.
Banks, consulting firms, fiduciary companies and attorneys
specializing in company law are also available to answer specific
questions.
The formation of a company takes two to four weeks from the
submission of required documents to the date when the company
is considered legally established (when it has legal effect with
respect to third parties). The time required can be shorter in simple
straightforward cases and in certain cantons. When foreign
operations are located in Switzerland, they generally take the
form of a stock corporation (AG). However, if the Swiss branch is
being established as a sole proprietorship, a general partnership
or a limited partnership, the foundation process can be handled
entirely online via the government SME portal – KMUadmin. This
business assistance system takes users step by step through
the creation of the documents required for registration of a sole
proprietorship in the commercial register, for value added tax
(VAT) and for social insurance obligations such as OASI (AHV in
German).
Online registration for new companies (German, French
and Italian only)
www.kmu.admin.ch
Languages: German, French, Italian
Fig. 18: Procedure for establishing a company (AG, GmbH)
Steps
Preliminary search, registration and approval of the company name
Preparation of required formation documents: articles of agreement, articles of association,
application for registration, etc.
Payment of company capital at a prescribed depositary (bank). The depositor must show
proof of identity. For foreign nationals, it may be useful to present letters of reference
from Swiss partners.
Formation of company and preparation of formation documents: articles of association or
bylaws, acceptance by statutory auditors, confirmation by recognized depositary (bank)
that the share capital has been paid in and is at the disposal of the company. In the event
that the company after formation does not have its own offices: domicile acceptance
statement.
Publication in the respective canton's official gazette
Entry of the responsible person(s) in the corresponding registers (commercial register and
possibly land register)
Registration as a taxable enterprise
Week
1 2 3 4 5 6
Source: Documentation provided by cantonal economic development agencies
46 Handbook for Investors 2010

5.4.2 Entry in the commercial register
The commercial register includes all commercial enterprises doing
business in Switzerland. It specifies each company’s extent of
liability and its authorized representatives. Its central focus is its
public disclosure role. Accordingly, the Central Business Names
Index, Zefix, which is maintained online by the Federal Commercial
Registry Office, is open to anyone for inspection and can also
respond to inquiries as to whether a company name is available.
All entries in and deletions from the commercial register are published
in the Swiss Official Gazette of Commerce (SOGC).
As a rule, any trading, manufacturing or other form of commercial
enterprise is required to be registered in the commercial register.
Registration guarantees that the company name is protected. It is
only after registration in the commercial register that legal entities
receive their own legal personality and status. The firm or business
name under which a commercial enterprise is operated can
be freely chosen, as long as it complies with legal regulations.
Stock corporations (AGs) and limited liability companies (GmbHs)
must specify the legal form as part of the company name. If the
company name of a general partnership does not list all partners
by name, it must contain the last name of at least one partner
along with wording that indicates the relationship between partners.
The company name of a sole proprietorship must include the
owner’s last name but may not contain any additional wording indicating
a relationship between partners or associates. Application
for registration in the commercial register can be done electronically
via the company formation portal for all legal company forms,
provided that the applicable requirements are met.
5.4.3 Foundation costs
The costs for forming a stock corporation are as follows (the fees
and consulting costs for limited liability companies are somewhat
lower):
• Fees (registration, registrar, land register, etc.): around
CHF 2,000.
• Consulting and attorney’s fees: from about CHF 2,000 to 5,000
for small companies.
• Securities issue tax: this tax or stamp duty applies to the issuing
of participation rights (whether for remuneration or not) and to
the increase in the nominal value of such participation rights.
The tax is levied at 1 % of the amount accruing to the company
as consideration for the participation rights but at least 1 % of
the nominal value, with an exemption for the first CHF 1 million.
This exemption applies generally to the formation of corporations
and to capital increases up to CHF 1 million. Existing companies
may therefore increase their nominal capital to CHF 1 million
without owing any securities issue tax.
Excluding the securities issue tax, the fixed formation costs therefore
total about CHF 7,000. For a small business that does not
need to provide extensive documentation, the costs total about
CHF 3,000. The total costs for forming a company, including professional
consulting fees, vary depending on the nominal capital.
Establishing a corporation is more time-consuming and generally
costs more than forming a partnership.
Overview of formation costs
Business Names Index of the Federal Commercial Registry
Office
www.kmu.admin.ch
Languages: German, French, Italian
www.zefix.ch
Languages: German, English, French, Italian
Your contact in Switzerland
Swiss Official Gazette of Commerce
www.shab.ch
Languages: German, English, French, Italian
Gema Olivar Pascual, Legal Partner
Attorney-at-Law
PricewaterhouseCoopers Ltd
Birchstrasse 160
CH-8050 Zurich
Direct phone: +41 58 792 43 77
E-mail: US-Desk@ch.pwc.com
Handbook for Investors 2010
47

6. Visas, residence and work permits.
Switzerland’s prosperity is partly due to the immigration of
foreign workers. Not only do they boost the economy, they
also enrich the culture. Thanks to the free movement of
persons between Switzerland and the EU, EU/EFTA citizens
can now remain in Switzerland without a lot of red tape. In
the labor market they have the same rights as Swiss workers.
For people from other countries who wish to work and live in
Switzerland, certain provisions apply.
Entering and living in Switzerland
consulate can only issue the visa if the Swiss federal or cantonal
office in charge has granted approval to do so. The type of visa
and the documents required depend on the purpose of the stay.
Permit and visa requirements by nationality
www.bfm.admin.ch
Search under: Visa
Languages: German, English, French, Italian
www.bfm.admin.ch
Link: Topics/Entry
Languages: German, English, French, Italian
6.1 Entering the country and visas.
Generally a valid travel document recognized by Switzerland is
sufficient to enter the country. Only citizens of certain countries
require an entry visa for stays of up to three months. A visa is
generally required for longer stays. The Federal Office for Migration
publishes the latest requirements on its homepage.
6.1.1 Visa regulations
Foreigners who require a visa must obtain an entry visa from the
Swiss consulate where they live before they enter Switzerland. The
One of the visa requirements is that applicants must prove that
they have enough funds available or can legally obtain them to pay
for living expenses during their trip through or stay in Switzerland.
The Swiss consulate may require the submission of a letter of
sponsorship before it issues the visa if the applicant does not have
sufficient funds or if there is some doubt on this point. The relevant
authorities will require that travel insurance be concluded regardless
of whether a letter of sponsorship has been submitted. The
minimum coverage for this insurance is EUR 30,000.
Swiss consulates abroad
www.eda.admin.ch
Link: Representations
Languages: German, English, French, Italian
48 Handbook for Investors 2010

Fig. 19: Do I need a visa?
I would like to travel to Switzerland.
Do I need a visa?
No
Are you a citizen of one of the following
countries? EU-25, EFTA, Andorra, Brunei,
Japan, Liechtenstein, Malaysia, New Zealand,
San Marino, Singapore, Vatican City
Yes
Are you a citizen of one of the
following countries? Antigua and
Barbuda, Argentina, Australia,
Bahamas, Barbados, Brazil,
Bulgaria, Canada, Chile,
Costa Rica, Croatia, El Salvador,
Guatemala, Honduras, Israel,
Mexico, Nicaragua, Panama,
Paraguay, Romania, South
Korea, St. Kitts and Nevis,
Uruguay, US, Venezuela
Yes
No
No
Will you be staying more than three months?
Do you plan to work?
Yes
You do not need a visa.
Welcome to Switzerland!
Yes
No
No
For more than eight days per calendar year?
Yes
You do not need a visa.
Welcome to Switzerland!
No
In one of the following industries?
Construction and construction-related
sectors, gastronomy, commercial and residential
cleaning services, surveillance and security
services, erotic services
Yes
You need a visa. Please contact the
Swiss consulate in your area for more detailed
information.
www.eda.admin.ch
Search under: Representations
6.1.2 Visa regulations for certain countries
Fig. 20: Visa regulations for certain countries
Country
Visa required for
a stay of up to
3 months
Visa required for
a stay of over
3 months
Exceptions/comments
Brazil No (V1) Yes V1 Work visa requirement:
• construction and construction-related sectors, gastronomy, commercial
and residential cleaning services, surveillance and security services and
erotic services
China Yes (V) Yes V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
Handbook for Investors 2010
49

Country
Visa required for
a stay of up to 3
months
No
Visa required for
a stay of over 3
months
No
Exceptions/comments
EU-25/EFTA
(Schengen)
India Yes (V) Yes V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
Japan No No
Canada No (V1) Yes V1 Work visa requirement:
• construction and construction-related sectors, gastronomy, commercial
and residential cleaning services, surveillance and security services and
erotic services
Russia Yes (V) Yes V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
Kazakhstan Yes (V) Yes V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
Hong Kong Dependent on travel Yes
The following are accepted documents for entry into Switzerland:
SAR document (see exceptions/comments)
• Hong Kong Special Administrative Region People’s Republic of China
Passport (HKSAR passport); visa waiver (V1)
• Hong Kong British National Overseas Passport (BNO passport); visa
waiver (V1)
• Hong Kong Certificate of Identity; visa requirement (V)
• Document of Identity for visa purposes with the entry «Chinese» under
the heading «Nationality.» In this case the document is a Chinese
passport (if there is no entry under nationality, it cannot be accepted for
entry into the country); visa requirement (V)
(The «Hong Kong British Dependent Territories Citizens Passport» is no
longer accepted.)
US No (V1) Yes V1 Work visa requirement:
• construction and construction-related sectors, gastronomy, commercial
and residential cleaning services, surveillance and security services and
erotic services
Taiwan Yes (V) Yes V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
Ukraine Yes (V, V5) Yes (V5) V Third-country nationals with a valid long-term residence permit from a
Schengen member state along with a recognized travel document do
not require a visa.
V5 Holders of official passports (diplomatic, service or special passports)
are exempt from the visa requirement for the following travel-related
purposes and durations:
• official missions
• other reasons for travel of up to 90 days, without employment
Source: Federal Department of Foreign Affairs FDFA
50 Handbook for Investors 2010

6.1.3 Application procedure
1. Persons requiring a visa must submit the visa application to
the Swiss consulate that is responsible for the area where they
live. Travel documents and any other requested documents
which explain the reason for the journey must be submitted
along with the application. The consulate homepage provides
detailed information about the required documents and the
relevant application forms. All documents, letters or certificates
that are not in German, French, Italian or English must
be submitted with a translation.
2. If the consulate requires a letter of sponsorship, the foreign
visitor must complete the relevant form and submit it to the
sponsor.
3. The sponsor completes and signs the form and submits it
along with the required documents to the cantonal or municipal
authorities in charge.
4. The letter of sponsorship is checked by the relevant cantonal
or municipal authorities and is entered into the Central Migration
Information System.
5. The results of this check are presented to the consulate without
delay, after which the consulate decides whether to issue
the visa.
If the visa is denied, the applicant can appeal to the Federal
Administrative Court in Berne within 30 days of notification by
requesting the decision for a fee from the Federal Office for
Migration.
Visa application form
www.bfm.admin.ch
Languages: German, English, French, Italian, Spanish,
Portuguese, Russian, Chinese
6.2 Residing in Switzerland.
Residence and permanent residence permits are issued by the
cantonal and migration offices. Stays of up to three months do
not require a permit, while stays of over three months do. It may
be possible to work depending on the type of permit issued.
Foreigners who reside in Switzerland receive a residence permit
indicating which type of authorization has been granted.
6.2.1 Types of permits
Fig. 21: Types of permits
L permit (purple):
B permit (grey):
C permit (green):
G permit (brown):
F permit (light blue):
N permit (dark blue):
Ci permit (red):
S permit (light blue):
For temporary positions and other temporary stays.
For residents (foreigners who are in Switzerland for a specific purpose for a longer period of time
with or without employment).
For permanent residents (foreigners who have received a permanent residence permit after
living in Switzerland for five or ten years. There is no limit on the amount of time they may stay in
Switzerland).
For cross-border commuters (foreigners who reside near the Swiss border and work in Switzerland).
For foreigners permitted to stay in Switzerland provisionally. This permit is issued by the cantonal
authorities based on approval by the Federal Office for Migration.
For asylum seekers. This permit is issued by the cantonal authorities based on approval by the
Federal Office for Migration.
This permit is issued by the cantonal authorities to the employed spouses and children of members
of foreign consulates or intergovernmental organizations.
For people in need of protection. This permit is issued by the cantonal authorities based on approval
by the Federal Office for Migration.
Source: Federal Office for Migration
Handbook for Investors 2010
51

Federal Office for Migration, residence
www.bfm.admin.ch
Link: Topics/Residence
Languages: German, English, French, Italian
6.3.2. Longer stays
Stays of more than three months also require a permit for persons
who are not gainfully employed (retirees, students, job seekers
and others). Permits are issued by the cantonal migration offices.
A distinction is made between short stays (less than one year),
temporary stays (of limited duration) and permanent stays (of
unlimited duration).
6.2.2 Reunification of families
Holders of an annual residence permit or temporary permit are
entitled to apply for permission for their families to join them;
a work permit is issued to the spouse and family members in
descending line. Spouses also have the right to a work permit
even if they do not share the same place of residence. It is also
possible for a spouse to be resident in another canton.
6.3 Residing in Switzerland without
gainful employment.
6.3.1. Stays of up to three months
Switzerland has been an associate member of the Schengen
Agreement, and thus part of the Schengen Area, since December
12, 2008. The provisions of the Schengen Agreement govern
entry and stays that do not require a visa for up to three months.
Generally, staying in Switzerland without employment (e.g. for a
visit, tourism) for up to three months does not require a permit.
However, a visa is necessary for nationals of certain countries.
Foreigners may stay in Switzerland for no more than three months
within a six-month period calculated from the first time of entry.
Persons requiring a visa must comply with the amount of time
they are permitted to stay as stipulated on their visa.
To enter the country, foreigners must have a valid travel document
that is recognized by Switzerland. For persons requiring a
visa, Switzerland issues Schengen visas, which are generally valid
for the entire Schengen Area for stays of up to three months.
Non-EU/EFTA nationals must submit the application for a residence
permit (together with the visa application) to the relevant
Swiss consulate before entering Switzerland. Depending on the
purpose of the stay (schooling, retirement, medical purposes,
etc.), different documents will be required. If the conditions for a
permit are met, then a short stay permit (L permit) for a stay of
less than one year will be issued, or a residence permit (B permit)
valid for one year will be issued if the applicant is to stay longer
than one year. After entering the country, the permit holder must
register with the relevant municipality.
EU/EFTA nationals who are not gainfully employed are granted
the right to stay in Switzerland based on the free movement of
persons agreement. After arrival, a residence permit must be
applied for at the municipality and will be granted if the following
requirements are met:
• The unemployed person must have sufficient financial funds to
prevent them from becoming dependent on state aid so they do
not become a burden on their new country of residence.
• They must have health insurance that covers all risks (even
accidents).
The EC/EFTA residence permit is valid throughout Switzerland for
five years and is automatically extended by the relevant authorities
if the above-mentioned requirements continue to be met. Unemployed
persons may bring their families with them if they have
sufficient financial funds to care for them.
Addresses of cantonal migration offices
www.bfm.admin.ch
Language: German
52 Handbook for Investors 2010

6.3.3 Special case: students
The procedure described in 6.3.2 also applies to students. The
following conditions also apply:
Students who are citizens of EU or EFTA states, the US, Canada,
Australia or New Zealand must generally provide credible proof
that they will not become a welfare case during stays of more than
three months (at the relevant Swiss consulate or municipality upon
registration). Students must also prove that they are enrolled at a
recognized school in Switzerland and will be attending general
instruction classes or a program preparing them for a profession.
If these requirements are met, the student will receive a residence
permit for the duration of their studies or for the period of one
year if their studies last longer than one year. The permit will be
extended until the student has received a regular degree if the
requirements for the permit continue to be met.
Students who are not citizens of EU or EFTA member states, the
US, Canada, Australia or New Zealand must also include the following
documents together with their personal entry application,
which they submit to the relevant Swiss consulate:
• Letter of acceptance from the school
• Proof of payment of tuition
• Proof of sufficient financial funding for living expenses for the
duration of the course of study
• Diplomas/school certificates
• Written agreement to leave Switzerland after completion of
studies
• Additional sheet documenting language proficiency. Language
proficiency is judged based on a short interview at the consulate.
The Swiss consulate sends the entry application, including
documentation and assessment of language proficiency, to the
relevant cantonal migration authorities for their approval.
6.4 Residing in Switzerland with
gainful employment.
People working in Switzerland during their stay in the country or
people staying for more than three months need a permit from
the cantonal migration office. A distinction is made between short
stays (less than one year), temporary stays (of limited duration)
and permanent stays (of unlimited duration).
The employer is responsible for obtaining a work permit from the
cantonal migration office.
Since the introduction of the bilateral agreements on the free
movement of persons and the revised EFTA convention, different
conditions have applied to EU/EFTA nationals than to people from
other countries. EU/EFTA citizens are on equal footing with Swiss
employees.
Other countries are subject to immigration restrictions and the
rule of priority for Swiss nationals. Foreign asylum seekers may
stay in Switzerland in accordance with the provisions of asylum
legislation.
The cantons are responsible for deciding on whether foreigners
may stay and reside in the country. However, the federal government
has the right of veto. The cantonal migration authorities are
responsible for alien control. Foreigners must register with the
Residents Registration Office in the municipality in which they
reside within eight days.
For anyone intending to relocate to Switzerland, it can be advantageous
to bundle the permit applications and to discuss them
beforehand. The cantonal economic development agencies provide
advice on how to proceed and how long the process takes.
Handbook for Investors 2010
53

6.4.1 Professional licenses
For some professions and for certain businesses, the federal
government or the cantons impose rules. Such cases require a
special permit or a patent or license. This applies to activities for:
• Banks, insurance companies and investment brokers
• Hotels and restaurants (only in certain cantons)
• Physicians, dentists, pharmacists and attorneys
• Certain mercantile and services businesses (e.g. wine merchants,
private employment agencies, temporary employment
services)
Foreign nationals can perform these activities in Switzerland if
they have the required permits. In certain cases, approval is subject
to a «demonstration of need» clause. Since the introduction
of the bilateral agreements with the EU, the rules have gradually
been eased thanks to the mutual recognition of professional
qualifications.
Residing in Switzerland
www.ch.ch
Search under: Residence permits
Languages: German, English, French, Italian
Fig. 22: Work and residence permits: rules and procedures
EU/EFTA nationals
EU-17 (original EU states including Malta
and Cyprus)
Temporary residence permit
(L permit for EC/EFTA)
• entitlement to permit, provided that employment
in Switzerland for three months
to one year can be proved (employment
of less than three months in one calendar
year: registration only)
• possibility to bring family
Cross-border commuter permit
(G permit for EC/EFTA)
• no travel restrictions
• obligation to return home to main residence
in EU/EFTA country every week
• self-employment possible
• validity based on employment contract,
with maximum of five years, after which
renewable
EU-8 (eastern European countries joined
in 2004)
Temporary residence permit
(L permit for EC/EFTA)
• entitlement to permit, provided that
employment can be proved, renewal after
one year for up to one year if employment
is secure, subject to any quotas
• annually rising quota for permits: 15,800
(2007) to 29,000 (2010)
• priority to Swiss nationals, controls on
salary and employment conditions
• possibility to bring family
Cross-border commuter permit
(G permit for EC/EFTA)
• travel within all Swiss border zones
• priority of Swiss nationals, checks for
salary and employment conditions
• rest same as for EU-17
Non-EU/EFTA nationals and Bulgarian
and Romanian citizens
Short-term residence permit
(L permit)
• for key positions (founding a company,
training new staff, specialists from international
companies): 12 months, can be
renewed for 24 months
• possibility to bring family
• annual quotas of 5,000 permits for trainees:
valid for 12 – 18 months, no option
to bring family
Cross-border commuter permit
(G permit)
• valid for 12 months for border zones of
the canton issuing the permit, must be
renewed every year
• resident at least six months with permanent
residence permit in the border zone
of a country neighboring Switzerland
• weekly return to this residence
• possible to change place of work or
profession with permission
54 Handbook for Investors 2010

EU/EFTA nationals
EU-17 (original EU states including Malta
and Cyprus)
Residence permits
(B permit for EC/EFTA)
• valid for five years, after submission of
confirmation of employment lasting a
year or more or without time restriction
• year-round purpose-related stay with
permanent home life and residence in
Switzerland
• possibility to bring family
• entitled to take up self-employment
Permanent residence permit
(C permit for EC/EFTA)
• basically issued after a stay of five years
in Switzerland based on residence
agreements or equivalent rights considerations
• basically equal to Swiss nationals on
labor market
EU-8 (eastern European countries joined
in 2004)
Residence permits
(B permit for EC/EFTA)
• annually rising quota for permits: 1,700
(2007) to 3,000 (2010)
• switch from self-employment to employment
at a company requires permission
• priority of Swiss nationals, checks on
salary and employment conditions
• possibility to bring family
• rest same as for EU-17
Permanent residence permit
(C permit for EC/EFTA)
• same as EU-17
Non-EU/EFTA nationals and Bulgarian
and Romanian citizens
Residence permits
(B permit)
• full-year stay in Switzerland with employment
and permanent home life and
residence in Switzerland
• priority of Swiss nationals, checks for
salary and employment conditions
• possibility to bring family
• annual renewal of permit is a formality
• annual quota of 4,000 permits
Permanent residence permit
(C permit)
• can generally be applied for after stay of
10 (US citizens: 5) consecutive years in
Switzerland
• the holder is generally no longer subject
to labor market restrictions
• entitled to take up self-employment
6.4.2 Residence and employment of EU/EFTA citizens
EU/EFTA nationals are treated the same as Swiss nationals in the
labor market as a result of the free movement of persons agreement.
Job seekers may remain in Switzerland for three months
without a permit. Citizens of the EU-17 member states already
enjoy completely free movement – citizens of the EU-8 states are
still subject to restrictions until the permanent transition on May
31, 2011 (priority of Swiss nationals, controls, quotas). These permits
can be extended if needed. By no later than June 1, 2014,
however, citizens of all 25 EU countries will enjoy unrestricted free
movement.
Currently EU-17 nationals do not need a work permit, but they
must still obtain a residence permit, which is issued by the cantonal
migration office upon confirmation of employment/submission
of an employment contract. No permit is needed for stays of
less than 90 days, but these workers are still required to register.
Self-employed service providers whose headquarters are based
in the EU or EFTA region no longer require a license for activities
in Switzerland lasting less than 90 days per calendar year.
They simply need to register, which can be done via the Internet.
Exceptions to this are EU-8 service providers in the fields of construction,
landscaping, cleaning and surveillance/security, which
still require a license.
The introduction of the free movement of persons is being accompanied
by a series of measures designed to prevent wage
and social dumping, as well as by the mutual recognition of
professional qualifications and the coordination of social insurance
issues. This simplifies recruiting employees from EU/EFTA
countries and attending and using academic institutions in these
countries, and it boosts the efficiency of the labor market and
increases the availability of highly qualified staff.
Handbook for Investors 2010
55

Regulated professions
www.bbt.admin.ch
Search under: Diploma recognition
Languages: German, English, French, Italian
to continue working in Switzerland after completing their studies.
It is ultimately in the interest of the Swiss economy that foreigners
temporarily working in Switzerland be permitted to bring their
family to Switzerland, and that partners and children of holders
of a long-term residence permit have the right to be employed or
self-employed in Switzerland.
Swiss/EU relations
www.europa.admin.ch
Languages: German, English, French, Italian
Social insurance
www.bsv.admin.ch
Languages: German, English, French, Italian
6.4.3 Residence and employment of non-EU/EFTA citizens
Citizens from countries outside the EU-15/EFTA and from the
two most recent EU member countries, Bulgaria and Romania,
require a work and a residence permit in any case. They are
still subject to the existing admissions regulations (priority for
nationals, control of wages, quotas), but they have been granted
significantly more mobility in the interest of labor market flexibility.
Holders of a long-term residence permit are free to change jobs
and place of employment, and to be self-employed anywhere in
the country without requiring special authorization. In important
cases, holders of a short-term residence permit may also work for
an employer in another canton.
Priority is given to highly qualified and specialized professionals,
as well as to entrepreneurs and executives, recognized scientists
and key persons involved in cultural events, employees of
internationally active corporations and people with international
business relations. This approach aims to promote economic,
scientific and cultural exchanges and to support the transfer
of decision-makers and specialists of international companies.
Qualified scientists should, in particular, be given the opportunity
Key regulations:
• B residence permit: generally valid for one year. Option to
change jobs and cantons with permission, source tax, quotas
(certain exceptions: e.g. spouses of Swiss citizens have the
same rights as Swiss citizens).
• C residence permit: same rights as Swiss nationals in labor
market, no source tax.
• Cross-border commuter permit: possible to change jobs with
permission, not possible to change cantons, source tax.
• L short stay residence permit: not possible to change jobs or
cantons, source tax.
• Intern permit: maximum of 18 months, only for training young
professionals.
• Asylum seekers: Work permit one month following submission
of application for asylum. Possible to change jobs with permit,
not possible to change cantons. Source tax, 10 % of salary is
retained as security.
• Transfer of managerial staff: Essential management staff may
reside in Switzerland for three years in accordance with the
General Agreement on Trade in Services (GATS). The permit
can be prolonged for one year.
The employer is responsible for checks and due diligence, as well
as for ensuring that a foreign employee has permission to assume
the position. In order to obtain an entry visa, the employer
must prove that it was not possible to find a suitable candidate in
Switzerland and that the training of a suitable employee within a
reasonable period was not possible.
Employment of non-EU/EFTA citizens
www.bfm.admin.ch
Search under: Topics/Labour/Work permits
Languages: German, English, French, Italian
56 Handbook for Investors 2010

Social insurance for foreign nationals
www.bsv.admin.ch
Link: Topics/Overview/Advice/FAQ
Languages: German, English, French, Italian, Portuguese,
Russian, Chinese, Japanese
6.4.4 Trainees/interns
Switzerland has negotiated agreements with numerous countries
on the exchange of trainees/interns. These trainee agreements
make it easier to obtain residence and work permits of limited duration.
Trainees from countries which have no special agreement
with Switzerland must follow the normal application procedure for
work and residence permits.
Trainees/interns are defined as people between the ages of
18 and 30 who have completed their vocational training of at
least two years. The age limit is 35 (exceptions: Australia, New
Zealand, Poland, Russia and Hungary: 30 years). The job must
be in the profession that was studied and may last no more than
18 months. Canadian students who would like to complete their
education with an internship are also admitted. There are special
quotas for trainees, and national legislation giving priority to
Swiss nationals does not apply. There is no provision for trainees
to bring their families with them.
Fig. 23: Countries with which Switzerland has a trainee agreement
Argentina
Australia
Bulgaria
Canada
Czech Rep.
Hungary
Monaco
New Zealand
Philippines
Poland
Romania
Russia
Slovakia
South Africa
Ukraine
US
Source: Foreign trainees in Switzerland: guide for foreign trainees and Swiss
employers, www.swissemigration.ch
www.swissemigration.ch provides a guide for foreign trainees and
potential employers, addresses, a standard employment contract
and application forms.
Guide
www.swissemigration.ch
Search under: Trainee exchange
Languages: German, English, French, Italian
6.5 Naturalization.
The naturalization process consists of three levels. It is possible
to apply for Swiss citizenship in your municipality or canton, each
of which has its own requirements for naturalization in addition to
those imposed by the federal government (see below).
The following requirements must be met to become a naturalized
Swiss:
• Resident for 12 years in Switzerland (years of residency between
ages 10 and 20 count double)
• Integration into Swiss life
• Familiarity with the Swiss lifestyle, customs and traditions
• Observance of Swiss laws
• No threat to the domestic or international security of Switzerland
Foreign spouses of Swiss citizens (simplified naturalization after
five whole years of residence in Switzerland and after three years
of marriage) and children of Swiss parents who are not yet Swiss
citizens benefit from simplified naturalization.
Information on naturalization
As a result of the bilateral agreements between Switzerland and
the EU on the free movement of persons, nationals of the 15 original
EU countries and Norway no longer need official work permits.
Verification has been replaced by mandatory registration – anyone
residing in Switzerland for more than four months in order to work
must be officially registered with the cantonal labor market office.
Owing to this improved legal status, the trainee agreements with
these countries have been suspended.
www.ch.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
57

7. Real estate.
Although Switzerland has many different types of real estate
available for commercial purposes, there is a shortage of
residential real estate, especially in city centers, much like in
other international cities. People looking for suitable properties
to rent or buy will find the Internet and newspapers very
useful. Even individuals resident in foreign countries can
purchase commercial real estate in Switzerland without prior
authorization. When it comes to residential property, however,
they are subject to certain restrictions.
7.1 Looking for the right property.
7.1.1 Residential and commercial properties
The Internet and newspapers are the most important sources of
information when you are searching for a suitable property. Local
acquaintances can also be a big help. The range of real estate on
offer includes apartments, single-family and multi-family residences,
offices and commercial properties, and even parking lots and
garages – to rent or buy.
Another good source of information are the websites of real estate
fiduciary agencies. You can find them through real estate search
portals or via the website of the SVIT Real Estate Association
(www.svit.ch), for example. Municipalities’ websites are also useful:
Many of them now include information about future building projects,
including both rental properties and properties for sale.
The cantonal economic development agencies support investors
in all administrative matters and offer assistance in finding
construction sites or other real estate.
Fig. 24: Online sources of information on real estate
www.alle-immobilien.ch Search engine for real estate on
the market.
Languages: German, English,
French, Italian
www.comparis.ch/immobilien Real estate website with price
comparison function.
Languages: German, English,
French, Italian
immo.search.ch
Real estate website with a great
deal of additional information.
Languages: German, French
www.swissinfo.ch
List of real estate market links.
Link: Services/Swisslinks Languages: German, English,
French, Italian, Portuguese,
Russian, Chinese, Japanese
www.mieterverband.ch List of links with comments.
Search for: Wohnungssuche Languages: German only
www.homegate.ch
Real estate portal.
www.immoscout24.ch Languages: German, English,
French, Italian
58 Handbook for Investors 2010

7.1.2 Temporary accommodation and furnished apartments
The range of available hotels and vacation lets in every price
category is very broad in Switzerland, given that it is a tourist destination.
The best starting point for anyone searching for appropriate
accommodation is again the Internet. The Switzerland Tourism
website «MySwitzerland.com» gives a good overview. Furnished
homes or apartments and serviced apartments are fairly rare and
can be expensive. However, there are real estate providers and
firms specializing in expatriate services that can offer assistance.
There is no nationwide overview of all providers, so it is a good
idea to search online using keywords such as serviced apartments,
furnished, studio, apartments, temporary housing or holiday or
vacation apartments.
7.2 Commercial properties.
Switzerland Tourism, accommodation
www.myswitzerland.com
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
Relocation agencies, providers of furnished and serviced
apartments
www.xpatxchange.ch
Link: Moving
Language: English only
7.2.1 Rental
Fig. 25: Market prices for office space, as of fourth quarter 2008
Net rents in CHF per square meter area of usable floor space per year (median)
Large cities: figures for city center
over 300
250 to 300
200 to 250
150 to 200
100 to 150
below 100
Source: Wüest & Partner
Handbook for Investors 2010
59

7.2.2 Purchase
There are no restrictions on individuals residing outside Switzerland purchasing commercial real estate.
Fig. 26: Steps in a purchase transaction
Pre-purchase clarifications:
matters under public and
private law
• Planning law matters
• Evaluation of statistics
• Cadastral plans of encumbered locations
• Road-building projects
• Business permits
• Air-quality action plan
• Noise pollution level
• Taxes
• Checks on all land register entries (easements, cautions, notices)
• Cadastral plan
• Buildings insurance
• Property valuation commissioned
• Financing
• Checks on identity of the seller
• Lease and tenure situation
Sales negotiations
completed
• Purchase property precisely defined
• Price set
• Date of transfer of rights and obligations
• Financing confirmed
• Financial collateral
Official notarization by a
notary of that town/city
• Contract signed in the presence of a notary
• Any financial collateral paid
Land register formalities
performed by the competent
land register
• Exchange: the property is exchanged in return for the payment
• (land register entry signed)
Source: Immobilien Kaufen und Verkaufen (Buying and Selling Real Estate). Bürgi Nägeli Attorneys
60 Handbook for Investors 2010

Fig. 27: Construction sites: market prices for commercial buildings, as of fourth quarter 2008
In CHF per square meter (average location, no buildings, with roads and services)
over 1,500
1,000 to 1,500
500 to 1,000
250 to 500
150 to 250
below 150
Source: Wüest & Partner
7.3 Residential properties.
7.3.1 Rental
Two in three people in Switzerland live in rented accommodation.
Demand is high and availability scarce, especially in cities and large
urban areas. Since 2003, the vacancy rate has hovered around the
1 % mark (2007: 1.07 %). It therefore takes some patience and luck
to find the right apartment. Apartments in Switzerland are usually
let unfurnished. Kitchens are fully equipped and generally include a
dishwasher in addition to an oven and refrigerator. For a four-room
apartment (three bedrooms, a living room, kitchen and bathroom),
the average rent is CHF 1,354 per month (as of first quarter 2009),
although rents vary widely by region. Prices also depend on the
apartment’s age and the quality of the interior.
A number of factors can affect rents. The cantons with the highest
rents are usually prime locations within reach of major urban
centers. Another factor that explains high rents is a low tax
burden.
7.3.2 Purchase
Any person residing in Switzerland can easily purchase residential
property. Only the acquisition of residential property by individuals
resident abroad («persons abroad») is subject to certain legal restrictions
(see section 7.5). The home ownership rate in Switzerland
is about 40 %. It is especially high among families with children and
older people and in the higher income brackets.
Handbook for Investors 2010
61

Fig. 28: Market prices for rental apartments, as of fourth quarter 2008
Net rents in CHF per square meter of net internal area per year (median)
over 220
200 to 220
180 to 200
160 to 180
140 to 160
below 140
Source: Wüest & Partner
Once the right property has been found, the next step is to sign a
contract of sale. This contract forms the basis for any real estate
acquisition and must be drawn up and notarized by a notary. It
obliges the seller to transfer the property and the buyer to pay the
agreed purchase price. The contract also describes the property
and stipulates the date on which the property will be handed over
and the securing of any capital gains tax on the property.
Before signing the contract, it is advisable to check the land register
to see whether any rights and encumbrances are associated
with the land on which the property stands or will be built. By
providing proof of interest, you can obtain detailed information in
the form of an extract from the land register, for which there is a
fee. The information recorded in the land register can be complex.
Although a right-of-way is easy for the layperson to understand,
the situation is much more complicated when it involves building
law or regulations applying to condominiums. In these cases, it
may be advisable to consult an expert. The notary who handles
the sale can also provide further information. The contract of sale,
which must always be publicly notarized, represents the actual
underlying transaction and is required for subsequent registration
in the local land register. Ownership actually passes to the buyer
when the land register entry is made. There is no centralized land
register for all of Switzerland; each canton maintains its own register
under the supervision of the Federal Office of Justice.
62 Handbook for Investors 2010

Fig. 29: Market prices for owner-occupied apartments, as of fourth quarter 2008
In CHF per square meter of net internal area (median)
over 5,000
4,500 to 5,000
4,000 to 4,500
3,500 to 4,000
3,000 to 3,500
below 3,000
Source: Wüest & Partner
SVIT Real Estate Association
www.svit.ch
Languages: German, English, French, Italian
Verband Schweizerischer Grundbuchverwalter (Federation
of Swiss Land Register Administrators)
www.grundbuchverwalter.ch
Languages: German, French, Italian
Land register overview
www.ch.ch
Search under: land register
Languages: German, English, French, Italian
Ancillary costs for purchase of residential property
www.hausinfo.ch
Link: Finanzen und Steuern/Kauf und Verkauf (Finances &
Taxes / Buying & Selling)
Languages: German, French
Handbook for Investors 2010
63

7.4 Legal aspects: building
permits.
Buildings and installed systems may only be erected or altered
with the consent of the appropriate authorities. The construction
project must first comply with the municipality’s zone use plan,
and then must also meet other requirements based on planning
law and environmental regulations (water, air, waste and noise) or
requirements in the interests of public health and safety.
The building permit process takes an average of three months.
Submitting a planning application (application for a building permit)
is basically a standardized process. In addition to the project
plans, a number of other forms and types of evidence must be
submitted, depending on the particular project. It is in the owner’s
interest to obtain a legal building permit as quickly as possible
since the owner must bear the financing costs during the planning
and building permit phases. The typical building permit process
has four stages:
1. Notification of the authorities
2. Submission of planning application, preliminary examination,
additional investigation (environmental impact assessments,
historic preservation, etc.)
3. Examination of the application, public notification (publishing
a notice and staking out the extent of the structure), issue of
the building permit (including conditions and deadlines)
4. Period in which objections to the project can be submitted;
construction approval
7.5 Legal aspects: purchase of real
estate by persons abroad.
Acquisition of real estate in Switzerland by «persons abroad» (non-
Swiss nationals and other foreign entities) is restricted by law and
may require a permit. However, the permit requirement basically
applies only to the purchase of vacation homes and residential
property that will not be used directly by the party in question. As
such, foreign nationals actually resident in Switzerland may purchase
residential or commercial properties.
The abolition of the law in question, the Federal Act on the Acquisition
of Real Estate by Persons Abroad (known as the «Lex Koller»),
is currently being debated in the Swiss parliament (as of the first
quarter of 2009). For now, the acquisition of real estate by persons
abroad is still subject to the restrictions described below.
7.5.1 No permit required
The following groups of individuals and entities may purchase
property without first obtaining a permit:
The purchase of land for residential construction is subject to the
provisions described in section 7.5.
Planning applications and building permits
www.ch.ch
Search for: Building permit
Languages: German, English, French, Italian
64 Handbook for Investors 2010

Fig. 30: Permit requirement by group
Group
All persons
Nationals of member states of the European Community/European Union (EU) or of the European Free
Trade Association (EFTA) resident in Switzerland (generally individuals with an EU/EFTA B residence
permit or an EU/EFTA C settlement permit)
Non-EU or non-EFTA nationals who have permanent residency status in Switzerland (individuals with a
C settlement permit)
Non-EU or non-EFTA nationals residing in Switzerland who do not yet have permanent residency status
in Switzerland (generally individuals with a B residence permit)
Companies based in Switzerland that are controlled by individuals who are not subject to the authorization
requirement
EU and EFTA cross-border commuters (with an EU/EFTA G cross-border commuter permit)
Property that can be acquired
without authorization
Commercial real estate
All types of real estate
All types of real estate
Main residence
All types of real estate
Second home in the area in which
their workplace is located
No permit is required for real estate that is used for the pursuit of
a business activity, i.e. a professional, commercial or industrial
activity (with the exception of land for the construction, trade or
letting of housing). The concept of business activity is very broad.
It applies not only to the classic forms of trade, industry and commerce
but also to the financial and services sector. It therefore
covers self-employed professionals such as IT specialists or hotel
owners, as well as the operation of a trade or service center and
even industrial production. The acquisition of an interest in real estate
companies engaged in the buying and selling of such properties
is also possible. Residential property can also be acquired
under the «business establishment» heading if it is necessary for
business purposes (such as accommodation for caretakers or
technicians whose permanent on-site presence is required) or if
separation from the business property would be impractical or
unreasonable.
7.5.2 Permit required
A permit is required for purchase of non-commercial property by
the following groups:
• Foreign nationals resident outside Switzerland
• Non-EU/non-EFTA nationals resident in Switzerland who do not
have a settlement permit (i.e. permanent resident status)
• Companies with their head office outside Switzerland (even if
the owner is a Swiss citizen)
• Companies that have their legally registered and actual head
office in Switzerland but are controlled by non-Swiss nationals
resident outside Switzerland. This is the case if foreign nationals
hold more than one-third of the company capital, have more
than one-third of the voting rights or have provided significant
loans.
• Buyers who purchase a piece of property for the account of a
person abroad (fiduciary transaction)
The permit requirements apply not only to the transfer of real estate
ownership requiring land register entries but also to any legal
transaction that gives a non-resident actual control over any real
estate for which a permit is required. For this reason, these groups
are not allowed to invest directly in the housing market or conduct
real estate dealings involving residential properties.
7.5.3 Reasons for permit
Permission for the acquisition of properties for which a permit is
required may be granted in the following cases on the grounds
provided for by law:
• Banks licensed in Switzerland may be granted a permit if the
real estate is encumbered with a mortgage in their favor; insurance
companies may be granted a permit on the grounds of
actuarial reserves for domestic business
Handbook for Investors 2010
65

• A permit may be issued if the real estate acquisition is used by
a Swiss company for the purposes of retirement plans for staff
working in Switzerland
• A permit will be granted if the property will be used specifically
for a charitable purpose
• Heirs and legatees: a permit is granted with the stipulation that
the property must be sold within two years (exception: close
relationship to the property worthy of protection)
• Hardship case: a permit may be granted for a vacation home
or a hotel condominium unit if the seller is in financial difficulty
and has offered the property without success to individuals
who are not required to obtain a permit
• (Certain cantons only) A foreign national not resident in Switzerland
may receive a permit to purchase a second home in a town
with which he/she has close economic, scientific/academic or
cultural ties
• (Certain cantons only) Persons abroad may be authorized to
acquire real estate for the construction of subsidized housing
7.5.4 Execution
Enforcement of the law is primarily the responsibility of the canton
in which the real estate is located. The authority designated by
the canton decides whether or not a transaction requires a permit
and whether or not a permit should be granted. Under certain
conditions, persons abroad can also be permitted to purchase a
vacation home. However, ownership of real estate in Switzerland
does not entitle a foreign owner to a residence permit.
Acquisition of real estate by persons abroad
www.bj.admin.ch
Search for: Acquisition of real estate
Languages: German, English, French, Italian
66 Handbook for Investors 2010

8. Labor market and labor laws.
Switzerland has one of the most productive workforces of
any national economy. Its labor market is characterized by
liberal legislation, light-touch regulation and exceptional social
stability. Labor conflicts are solved through the productive
relationship between labor and management. Strikes are
rare. The social insurance system for workers is based on the
principles of solidarity and personal responsibility. The high
wages attract well-qualified workers, and employers benefit
from competitive unit labor costs thanks to low social security
deductions.
8.1 Employment and
unemployment.
Switzerland has around 4.5 million employed people (as of third
quarter 2008, excluding cross-border commuters and short-term
residents), two million of whom are women. The labor force participation
rate (people in or seeking as a percentage of the population
aged 15 and over) is 68.2 %, which is the second-highest in the
whole of Europe. Foreigners account for 27 % of the employed
population. One-third of employed people work part-time, and
the number is rising. 57 % of women work part-time, compared
to just 13 % of men. Switzerland has consistently had low unemployment,
which has remained between 1 % and 4 % over the
past ten years.
Swiss workers are highly qualified – in 2008 32 % had a higher
education degree. Switzerland is famous for its multilingual employees,
and Swiss managers have more international experience
than average. In terms of worker motivation, the Swiss rank second
only to the Danish. Swiss employees are very loyal to their
companies, partly because most firms are small or medium-sized.
Fig. 31: International comparison of worker motivation (2009)
1 = low, 10 = high
1 Denmark 8.69
2 Switzerland 7.90
3 Austria 7.81
4 Norway 7.38
5 Netherlands 7.12
6 Japan 7.04
7 Singapore 6.98
11 Germany 6.70
12 Ireland 6.55
13 Belgium 6.53
14 Hong Kong SAR 6.50
15 Brazil 6.46
21 Luxembourg 6.07
22 India 6.03
24 US 5.91
28 UK 5.53
29 People’s Republic of China 5.53
46 Italy 4.62
47 France 4.54
50 Russia 4.25
Source: 2009 IMD World Competitiveness Yearbook
Handbook for Investors 2010
67

Fig. 32: International experience (2009)
1 = low, 10 = high
1 Switzerland 7.94
2 Hong Kong SAR 7.21
3 Netherlands 6.99
4 Singapore 6.81
5 Qatar 6.65
7 Germany 6.55
8 Luxembourg 6.33
11 Denmark 6.21
13 Belgium 6.11
16 Ireland 5.74
19 Brazil 5.46
20 US 5.44
24 India 5.34
26 UK 5.28
39 France 4.54
51 Italy 4.04
52 Japan 3.93
54 Russia 3.88
57 People’s Republic of China 3.10
Source: 2009 IMD World Competitiveness Yearbook
8.2 Labor costs.
8.2.1 Salaries
Salaries are relatively high in Switzerland, reflecting the country’s
high levels of prosperity and output. Generous salaries are proof
of success and make Switzerland attractive to well-qualified
workers. Compared to other cities, gross wages in Zurich are
lower than in Copenhagen and Oslo only; but as lower deductions
(taxes, social insurance) are made, net income is the highest in
the world. Regular official surveys of wage levels and structures
show significant differences between and within sectors.
Fig. 33: Gross monthly salary (median), broken down by industry and region (2008)
Lake
Geneva
area
Industry Switzerland
Mittelland
Northwestern
Switzerland
Zurich Eastern
Switzerland
Central
Switzerland
TOTAL 5,623 5,655 5,430 5,875 6,134 5,273 5,512 4,824
Horticulture 4,160 4,292 3,987 4,127 4,282 4,097 4,250 3,765
SECTOR 2 PRODUCTION 5,742 5,812 5,589 6,257 6,056 5,511 5,744 4,910
Mining, quarrying of stone/soil 5,646 5,608 5,593 6,167 5,758 5,533 5,823 5,262
Manufacturing; industry 5,846 6,047 5,602 6,532 6,196 5,560 5,952 4,532
Energy and water supply 7,255 7,087 7,127 8,114 7,988 7,036 6,740 6,116
Construction 5,519 5,557 5,461 5,640 5,841 5,375 5,406 5,158
SECTOR 3 SERVICES 5,547 5,572 5,283 5,553 6,190 4,943 5,285 4,752
Trade, repair 4,908 4,856 4,667 5,159 5,122 4,679 5,071 4,383
Hospitality 3,902 3,850 3,850 3,987 4,123 3,733 3,921 3,569
Transport, communications 5,495 5,345 6,270 5,120 5,873 4,953 4,853 4,976
Banking and insurance 8,169 8,792 6,508 7,366 8,491 7,016 6,901 7,121
IT, R&D, corporate services 6,628 6,758 6,317 6,829 6,863 6,397 6,608 5,417
Education 6,925 6,627 6,792 7,368 7,274 7,233 6,668 6,032
Healthcare and social services 5,676 5,725 5,579 5,600 6,137 5,532 5,657 5,402
Other public and private services 5,548 5,577 5,372 5,322 6,814 4,619 5,104 4,312
Standardized monthly salary: full-time equivalents based on 4 1/3 weeks of 40 working hours
Source: Swiss Federal Statistical Office, Swiss Earnings Structure Survey
Ticino
68 Handbook for Investors 2010

Fig. 34: Gross annual earned income in each occupational group
in CHF (second quarter 2009)
Full + part-time
Men + women
Employees
Managers 107,000
Professions 90,000
Technicians and similar 71,600
Office staff, commercial occupations 56,300
Service and sales 42,500
Agricultural specialists 50,700
Skilled craftsmen and similar 68,300
Equipment and machine operators 67,600
Unskilled workers 29,300
Not disclosed/don't know 68,900
Total 67‚200
Source: Swiss Federal Statistical Office, Swiss Labor Force Survey
UBS Prices and Earnings Survey
www.ubs.com
Search under: prices and earnings
Languages: German, English, French, Italian
Wage level – by sector
8.2.2 Non-wage labor costs
The deciding factor for employers is not the salary that they pay
but rather the unit labor cost. Although salaries are high in
Switzerland, the non-wage labor costs that employers must bear
in addition to gross salary (employer social security contributions)
add up to just 15 %. Coupled with high productivity, modest taxes
and low capital costs, this means that at the end of the day many
employers pay less than in other European countries.
Fig. 35: Industry labor costs: direct remuneration and non-wage
labor costs (2007)*
Labor costs in EUR/hour
Norway 40.19
Belgium 35.84
Sweden 34.53
Denmark 32.81
Germany 32.70
Switzerland 32.70
France 32.26
Netherlands 31.34
Luxembourg 30.68
UK 27.19
Ireland 26.87
Italy 24.26
US 22.57
Japan 18.39
* Not available: Brazil, China, India, Russia
Source: Institute for the German Economy (Institut der deutschen Wirtschaft),
Cologne, Industry labor cost, international comparison, IW-Trends
3/2008
www.bfs.admin.ch
Search under: wage levels
Languages: German, English, French, Italian
Swiss Federal Statistical Office salary calculator
Swiss Federation of Trade Unions salary calculator
www.bfs.admin.ch
Search under: salary calculator
Languages: German, English, French, Italian
www.lohnrechner.ch
Link: Lohnrechner (salary calculator)
Languages: German, French, Italian
Handbook for Investors 2010
69

Fig. 36: Gross annual earned income in each occupational group
Example: Employee with two childern
Employee in % in CHF in CHF
Gross salary 10,000.00
Social security (OASI/DI/IC) 5.05 % 505.00
State-mandated unemployment insurance 1.00 % 100.00
Non-occupational accident insurance *** 0.49 % 49.00
State-mandated occupational pension fund ** 5.00 % 500.00
Daily sickness benefits insurance * 0.58 % 57.50
Social deductions – 1,211.50
Child/family allowance (two children) 200.00 400.00
Net salary 9,188.50
Employer
Gross salary 10,000.00
Social security (OASI/DI/IC) 5.05 % 505.00
Administrative costs 0.30 % 30.30
State-mandated unemployment insurance 1.00 % 100.00
Occupational accident insurance *** 2.00 % 200.00
State-mandated occupational pension fund ** 5.00 % 500.00
Daily sickness benefits insurance * 0.58 % 57.50
Family allowance (two children) 2.00 % 200.00
Employer contributions 1,592.80
Total staff costs 11,592.80
* Voluntary
** Amount varies according to the age of the insured person (approx. 3.9-10 % is mandatory)
*** Depends on the industry and business risks
8.3 Labor laws.
Swiss labor law governs the rights and obligations of employers
and employees. It includes significantly fewer requirements than
in EU states and is laid down in various acts, most notably the
Code of Obligations (individual employment contracts, collective
employment contracts, standard employment contracts), the
Labor Act (general health protection, working hours and breaks,
young people, pregnant women and nursing mothers) and the Accident
Insurance Act (occupational health and safety).
Where mandatory, legal provisions take precedence over any
collective tariff or employment agreements. In such cases, neither
the collective employment contract nor the individual employment
contract may contain contradictory provisions, particularly not
ones which are less favorable for the employee. Where labor law
provisions are not mandatory, however, matters are agreed upon
between the parties. Furthermore, some legal provisions can be
derogated from through collective bargaining agreements, but not
under individual employment agreements.
Salaries can be negotiated either on an individual basis between
the employer and the employee or under a collective bargaining
agreement. Here, too, legislation refrains from strict regulation
in favor of a liberal approach. Sufficient latitude has deliberately
been left for direct negotiation between labor and management.
70 Handbook for Investors 2010

Fig. 37: Labor market deregulation (2009)
Entrepreneurship is 1 = severely impaired,
10 = not impaired at all
1 Denmark 8.70
2 Switzerland 7.75
3 Singapore 7.40
4 Hong Kong SAR 7.13
5 Thailand 6.42
8 Japan 5.80
14 People’s Republic of China 5.33
16 UK 5.26
19 USA 5.06
26 Ireland 4.65
27 Russia 4.63
30 Netherlands 4.36
33 India 4.15
35 Luxembourg 4.04
40 Belgium 3.85
44 Italy 3.65
45 Brazil 3.63
46 France 3.58
51 Germany 3.06
Source: 2009 IMD World Competitiveness Yearbook
8.3.1 Individual employment contracts
Employers are required to provide employees with the key points
of the employment contract in writing by no later than one month
after the employee starts work.
In larger companies, it is recommended to have an employee
handbook containing the most important employment provisions,
as the employment contract itself only contains provisions on
wages, notice period and special terms (e.g. non-competition
clause). Employment contracts and employee handbooks must
conform to the mandatory provisions of the Swiss Code of Obligations
and the provisions of collective bargaining agreements,
where applicable. Employee handbooks should not be confused
with agreements between the employer and the works council,
as practiced in EU countries (and which do not exist in this form
in Switzerland). However, industrial companies are required to
establish «work rules» containing rules on occupational health
protection and accident prevention. The employees or their representatives
must be consulted before the rules are put into force.
Companies may include in the employment contract a noncompetition
clause for the duration of the employment with the
company and beyond. Through a non-competition clause, the
employer prevents employees who leave the company from using
special knowledge that they gained while working there in a way
that provides competition for their former employer. In practice,
demanding requirements are imposed on the wording and
enforcement of such clauses. There is no mandatory provision for
compensating employees for agreeing to such non-competition
clauses. Non-competition clauses must:
• be in written form
• clarify the definition (location, area, client group); a general
restriction is not sufficient
• specify duration; a maximum of three years is permitted.
8.3.2 Collective labor contracts
Collective bargaining agreements are concluded between employer
and employee associations. By so doing, the parties define
the minimum conditions (e.g. minimum salaries) that individual
employment contracts cannot go below. Employers and employees
are essentially free to decide whether they would like to join a
collective bargaining agreement or not. In Switzerland, there are
about ten such agreements that are generally binding and about
1,500 that are not generally binding. The former group applies to
the whole of the sector in question, while the latter only applies if
the contractual parties are members of the relevant associations.
If there are differences of opinion between an employer and the
workforce, an amicable solution is sought internally. This fundamental
approach dates back to the «peace agreement» between
Swiss employers and employee organizations of 1937. In accordance
with the mutual agreement to maintain peace, workers
and management seek to resolve conflict through discussions.
Solution-oriented labor market partnerships are still the norm
today.
Handbook for Investors 2010
71

Fig. 38: Cooperation between employers and employees (2008)
1 = total confrontation, 7 = total cooperation
Average: 4.5
1 Singapore 6.3
2 Switzerland 6.1
3 Denmark 6.0
4 Sweden 5.9
5 Austria 5.8
8 Hong Kong SAR 5.7
9 Netherlands 5.7
10 Japan 5.7
12 Luxembourg 5.4
23 Ireland 5.1
24 Germany 5.0
25 UK 5.0
26 USA 5.0
40 India 4.7
60 China 4.5
73 Belgium 4.3
87 Brazil 4.2
97 Russia 4.1
123 Italy 3.5
126 France 3.5
Source: The Global Competitiveness Report 2009 – 2010, World Economic
Forum
Declaration of general applicability of collective bargaining
agreements
www.seco.admin.ch
Search under: Gesamtarbeitsverträge (collective bargaining
agreements)
Languages: German, French, Italian
8.3.3 Employee participation and employee representation
The Co-Determination Act governs the participation of employees
in a company and applies to all private companies with employees
in Switzerland, regardless of their size. Participation consists
mainly of providing information to and listening to employees.
Employers must inform employees of all significant circumstances,
new developments and/or changes. Employees have the right
to take their questions and/or comments to their employer and
make suggestions. The act also governs the elections of employee
representation committees. Any company may have a committee,
but there is no requirement to have one. Employers need only inform
or consult the affected employees in the following instances:
• in all matters relating to work safety and worker protection
• on the transfer of operations
• in the event of mass redundancies
Works councils in the EU have far greater powers than employee
representation committees under Swiss law. The major difference
is that, in contrast to works councils, Swiss employee representative
committees are not able to push through their own views
or to force a decision. Their rights are limited to being informed,
having their views heard and providing decision-making input.
8.4 Working hours and leisure time
8.4.1 Normal working hours, maximum working hours and
working time models
Employment contracts or collective bargaining agreements
generally stipulate that normal working hours for employees in
Switzerland are 40 to 44 per week. The legal maximum working
time in Switzerland has remained stable over many decades.
The maximum working hours per week are 45 for industrial firms
(also applies to office staff and other employees). For commercial
operations, the maximum is 50 hours per week. The law provides
for longer hours for certain professions, such as taxi drivers and
junior doctors. This differentiation between normal and maximum
working hours is important for the definition of overtime.
In practice, there are many ways of adapting working hours to
the needs of a business, for example, flex-time, the range model,
two/multiple-shift operation or continuous operation (7 x 24 hours
x 365 days) are all possibilities. In particular, in the case of the need
for continuous operation, the daily and weekly maximum hours can
be extended and break times can be distributed differently.
8.4.2 Overtime and excess hours
The difference between normal and maximum working hours is
referred to as overtime. Employees are obliged to perform such
overtime to the extent that they are able to do so and which
they may be reasonably expected to perform. By law, overtime
must be paid at a premium of 25 %. It is possible, however, for
the premium to be waived in writing. Instead of overtime pay, the
employee may be compensated through time in lieu of at least
the same duration, provided the employer and employee mutually
agree to this. For employees in managerial positions it is possible
to compensate overtime generally through normal salary.
72 Handbook for Investors 2010

If the weekly maximum working hours are exceeded, this is
referred to as excess hours. Under the Labor Act, excess hours
may not exceed two hours per day for an individual employee.
In total, the excess hours may not exceed 170 hours per year for
employees with a weekly maximum working time of 45 hours, or
140 hours for employees with a weekly maximum working time of
50 hours. Unless compensated by time in lieu within a reasonable
time, excess hours must be paid at a premium of 25 %.
In contrast to many European countries, the consent of the employee
representative committee is not necessary in Switzerland
for overtime or excess hours. Neither is it necessary to obtain
official approval, provided the above limits are not exceeded.
8.4.3 Day work and evening work
Working hours from 6:00 a.m. to 8:00 p.m. are considered day
work; the hours from 8:00 p.m. to 11:00 p.m. constitute evening
work. Day and evening work do not require approval. However,
evening work may be introduced only after consultation with
the employee representative committee, or if there is none, after
consultation with the affected employees. This rule allows the
introduction of a two-shift operation without government approval.
The working time of an individual employee, including breaks and
excess hours, must be within a period of 14 hours.
8.4.4 Night work, working on Sundays and public holidays
Approval from the authorities is required if night work is needed.
For temporary night work, a premium of 25 % must be paid. For
permanent or regularly recurring night work, employees are entitled
to paid leave of 10 % of the time worked during night hours.
This leave must be granted within one year. There is no entitlement
for compensation in the form of paid leave if the average
shift time, including breaks, does not exceed seven hours, or if
the person working at night is employed for only four nights per
week.
Sunday is defined as the time between 11 p.m. on Saturday and
11 p.m. on Sunday. Except where special regulations apply to certain
sectors, approval from the relevant authority is also nee ded for
work on such days. Only one holiday – August 1, Swiss National
Day – is treated as equivalent to a Sunday throughout the whole
country.
The cantons may declare up to eight additional holidays as equivalent
to a Sunday. They must be differentiated from the legally
recognized public holidays: Although the same rules generally
apply to these days as to holidays treated as Sundays, the legal
basis for this is defined by the canton or municipality and so may
differ in detail from the provisions regarding Sundays.
Fig. 39: Demarcation of day, evening and night
6 a.m. 8 p.m. 11 p.m.
N
Day
Evening N
Max. 14 hours
B
17 hours requires no approval B
N = night hours B = requires approval
Source: State Secretariat for Economic Affairs
8.4.5 Holidays and public holidays
All employees in Switzerland are entitled to at least four weeks’
paid leave per year (young people under the age of 20 are entitled
to five weeks), two of which must be taken consecutively.
Part-time employees are also entitled to paid leave in proportion
to the percentage of standard hours they work. Leave must be
taken; it may not be compensated through payment. There are
no further statutory leave entitlements. However, longer entitlements
are customary in collective bargaining agreements, and 25
days per year are usually granted to employees over the age of
50. During time off, salaries are paid in exactly the same manner
as during regular working time. Additional vacation pay, as
frequently encountered in tariff agreements in the EU, is unknown
in Switzerland.
Handbook for Investors 2010
73

In addition, under federal law, employees have time off on nine
legally stipulated public holidays. As cantons may stipulate their
own public holidays, some cantons may have more public holidays.
Only August 1, New Year’s Day, Ascension Day and Christmas
Day are days off throughout the country; all other public
holidays vary from canton to canton. Employees also receive time
off for marriage, funerals, moving, dental appointments, etc. The
law does not stipulate how much time may be taken off.
Holiday calendar
www.feiertagskalender.ch
Languages: German, English, French, Italian
8.5 Notice of termination and
short-time working.
An employment contract can be terminated in writing or verbally
at any time by either party and without valid reason. Under Swiss
law, the employee representative committee does not have a say
in this type of termination.
Only in the case of mass redundancies does the employee representative
committee have the right to be consulted. However,
the recipient of the notice of termination has the right to demand
that the reason for termination be stated in writing. There is no
investigation of whether or not the termination is socially unjustified,
i.e. whether the reasons are related to the performance or
other characteristics of the employee or whether difficult business
considerations made the redundancy necessary. An employment
contract can be ended through:
• termination
• termination due to change of contract (new or changed contract
is not accepted by employee)
• agreement to terminate employment (mutual cancellation of
employment contract)
• termination on a specific date (for fixed-term contracts)
• retirement
• death of the employee
8.5.1 Notice periods and protection against dismissal
In general, the notice period is defined in the employment contract,
in the standard employment contract, by the relevant profession
or in the collective bargaining agreement. If there is no contract or
regulation, then the provisions of the Swiss Code of Obligations
apply:
• during the probationary period (max. three months): seven days
• during the first year of service: one month
• from the second to the ninth year of service: two months
• from the tenth year of service onwards: three months
The notice period can be changed in writing but may not be
shorter than one month (except under a collective bargaining
agreement during the first year of service). For employees in
managerial positions, notice periods of up to six months are often
fixed from the very outset of employment. After the probationary
period, notice of termination may only be given at the end of the
month. In order for the termination notice to be legally valid, the
person to be dismissed must receive it before the notice period
begins. Even in the case of summary dismissal, the employee’s
salary will continue to be paid out until the end of the notice
period.
An employment contract can be terminated summarily only in
serious exceptional circumstances, such as fraud, refusal to work
or competition with the employer. In practice, summary dismissals
are very difficult to carry out, as the reason for termination is
often open to interpretation.
It is improper to dismiss an employee on the grounds of age,
color, religion, political affiliation or membership of a trade union.
Improper dismissals can be appealed against and may give rise
to claims for compensation.
There are certain times when it is not possible to dismiss an employee,
such as when the employee is sick, has suffered an accident,
is pregnant or is serving in the military, civil defense, civilian
service or aid campaigns abroad. Dismissals in these situations
are not valid and are known as termination during barred periods.
8.5.2 Short-time working and mass redundancies
A company may be forced to take measures to lower staff costs
in the event of a deterioration in the order situation or for other
reasons. Overcapacity may be alleviated through a temporary reduction
in or complete halt to production. In order to maintain jobs,
the employer receives 80 % of the lost income of the employees
74 Handbook for Investors 2010

for a specific period from unemployment insurance by applying
for short-time working. This is done to prevent dismissal as a
result of a temporary and unavoidable lack of work.
Dismissals are the last means that a company can resort to when
utilization levels fluctuate. In the event of mass redundancies,
Sections 335d – 335g of the Swiss Code of Obligations stipulate
that the employer
• must consult the employees, and
• must inform the cantonal labor office in writing.
Compared with other countries, Switzerland has highly investorfriendly
labor market provisions. It is relatively easy for companies
to appoint and dismiss employees.
Fig. 40: Appointments and dismissals (2008)
1 = hampered by regulation, 7 = employers have flexibility
in decision-making
1 Singapore 5.9
2 Denmark 5.9
3 Hong Kong SAR 5.8
4 Switzerland 5.6
5 Bosnia and Herzegovina 5.5
8 USA 5.4
43 Russia 4.2
50 UK 4.1
74 Ireland 3.8
77 China 3.8
103 India 3.2
111 Luxembourg 3.1
114 Netherlands 3.0
115 Belgium 3.0
116 Japan 3.0
118 Brazil 2.9
119 France 2.8
126 Germany 2.5
128 Italy 2.5
8.6 Social insurance.
The Swiss social insurance system is based on three coordinated
pillars: state-sponsored, employer-sponsored and personal plans.
Personal responsibility is a key factor in this system. As a result,
the overall tax and contribution burden remains modest by international
standards.
The three pillars of Swiss social security:
Pillar 1: This first level meets the basic needs of the insured or
beneficiary through the government-sponsored old age and
survivors’ pension (OASI), as well as long-term disability insurance
or incapacity benefit (DI). Both are compulsory and are
funded jointly through contributions (percentage of salary) by the
employer and the employee.
Pillar 2: The occupational pension plan (BVG), which supplements
the first pillar, makes it possible for retired persons to maintain
their accustomed standard of living after retirement. All persons
working in Switzerland must be insured. The plans are funded
through contributions (percentage of salary) by the employer and
the employee.
Pillar 3: Personal voluntary retirement plans of employees or
self-employed individuals cover additional personal needs, mainly
through bank and insurance savings. Contributions to individual
retirement plans enjoy preferential treatment under tax laws to
some extent.
These three basic pillars of social insurance are supplemented by
unemployment insurance, the compensation system for loss of
income due to military service or civil protection, maternity benefits
and family allowances, which are governed by cantonal law.
Source: World Economic Forum, The Global Competitiveness Report
2009 – 2010, www.weforum.org
Short-time working
www.treffpunkt-arbeit.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
75

Fig. 41: Overview of compulsory contributions
Insurance Employee Employer Self-employed Not gainfully employed
Old age and survivors’ 4.2 % of earned income 4.2 % of earned income max. 7.8 % CHF 370 – 8,409 per year
insurance (OASI)
Disability insurance (DI) 0.7 % of earned income 0.7 % of earned income max. 1.4 % CHF 62 – 1,400 per year
Compensation for loss 0.15 % of earned income 0.15 % of earned income max. 0.3 % CHF 13 – 300 per year
of income and maternity
benefits
Occupational accidents none as a ‰ of insured earnings
(varies from company
to company)
voluntary, insured under
mandatory health insurance
voluntary, insured under
mandatory health insurance
Non-occupational
accidents
as a ‰ of insured
earnings (varies from
company to company)
none
voluntary, insured under
mandatory health insurance
voluntary, insured
under mandatory health
insurance; unemployed
persons 43.70 ‰
Health insurance per capita none (voluntary if at all) per capita per capita
Unemployment insurance 1 % of insured earnings 1 % of insured earnings (not insurable)
none
(max. CHF 10,500 per
month, gross)
(max. CHF 10,500 per
month, gross)
Occupational pension max. 50 % of premiums. min. 50 % of the premiums.
(not insurable)
none
fund
Amount depends on
insurance provisions Amount depends
on insurance provisions
Family allowances none generally 2 % of salaries
(federal law)
only mandatory in
Appenzell Ausserrhoden
and Geneva
Advice for SMEs
SME information portal
www.bsv.admin.ch
Languages: German, French, Italian
www.kmu.admin.ch
Languages: German, French, Italian
76 Handbook for Investors 2010

8.6.1 Old age and survivors’ insurance (OASI)
OASI provides old-age benefits (retirement pension) or benefits
to dependants (widows’ and orphans’ pensions). The benefits
depend on the amount of previous income and the amount of time
for which contributions were made. OASI insurance is mandatory
for everyone who lives or works in Switzerland. The insurance is
based on the pay-as-you-go system: People who are working today
fund the pensions of today’s retirees. All men and women who
work in Switzerland are required to contribute, with the employer
paying half of the contribution and the employee the other half.
8.6.2 Disability insurance (DI)
The aim of disability insurance is to help integrate or return persons
who are disabled due to birth defects, illness or accidents (in)to the
workforce. A pension is paid out only when the person is unable
to take up employment or return to his/her job. Contributions are
mandatory and are levied together with OASI contributions.
8.6.3 Accident insurance
Accident insurance covers all persons employed in Switzerland
against accidents in the workplace, occupational illnesses and,
in principle, against non-occupational accidents. Healthcare and
ancillary needs (treatments, required medical aids, travel and
transport costs) and payments (daily benefits allowance, disability
pensions, settlements, lump-sum compensation and perpetual
care benefits and survivors’ benefits) are all covered. The employer
funds the premiums for occupational accidents and illness, while
the employee pays the premiums for non-occupational accidents.
The employer must finance the entire premium amount, but part of
this amount is deducted from the employee’s salary. The amount
is based on the employee’s insured salary. The maximum insured
salary is CHF 126,000 per year.
8.6.4 Health insurance and daily sickness benefits
Mandatory health insurance offers cover for illness, pregnancy
and accidents, where there is no accident insurance for this.
Employees are free to choose their policy. Everyone has the right
to basic insurance regardless of their health or age. In addition,
voluntary supplementary policies can be taken out (generally
requiring a health check). Premiums are charged per person, not
based on income. The amount of the premium depends on the
amount of the division of costs chosen (CHF 0 – 2,500 + 10 % of
the costs up to a maximum of CHF 700) and the municipality
where the insured person lives, averaging CHF 323 per month
(2009). Employers do not generally make health insurance contributions.
Daily sickness benefits are voluntary. Their cost depends on the
scope of cover (illness, maternity, accident), and the premiums
can be divided 50:50 between the employer and the employee.
If group insurance is not arranged for employees, employers are
obliged to pay employees their full salary for a certain period (depending
on years of service) if they are unable to work through no
fault of their own. That is why many employers take out daily sickness
benefits for their employees. Maternity and accident/illness
benefits are treated equally when salary payments are continued.
If a pregnant women cannot attend work for health reasons, she
is entitled to her full salary for a certain period of time.
Federal Office of Public Health
www.bag.admin.ch
Link: Topics/Health insurance
Languages: German, English, French, Italian
Federal Office of Public Health
www.bag.admin.ch
Link: Topics/Accident and military insurance
Languages: German, English, French, Italian
Comparison of health insurance premiums
www.comparis.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
77

8.6.5 Compensation for loss of income and maternity benefits
The Ordinance on Compensation for Loss of Income compensates
people who have lost part of their income due to military service
or civil defense. Since 2005, this ordinance has also covered loss
of income during pregnancy (maternity benefits). The insurance is
mandatory, and everyone who makes OASI contributions must pay
it (half is paid by the employer and half by the employee).
Entitlement to a salary during pregnancy is no longer dependent
on the length of time worked at a company. Employed pregnant
women receive 80 % of their average salary before delivery, up to
a maximum of CHF 196 per day, for 14 weeks. It is not possible to
dismiss women while they are pregnant or for 16 weeks after delivery.
Mothers may not work for up to eight weeks after delivery.
Federal Social Insurance Office
www.bsv.admin.ch
Link: Topics/income compensations
Languages: German, English, French, Italian
Official SECO homepage, work
www.treffpunkt-arbeit.ch
Languages: German, English, French, Italian
8.6.7 Occupational pension scheme
Occupational pension funds serve to ensure that the employee’s
accustomed standard of living can be maintained. They are based
on the Federal Act on Occupational Pensions, which since 1985
has provided mandatory insurance for all employed persons from
the age of 18 (against risks) and from the age of 25 (savings plan).
A person must currently earn a minimum of CHF 20,520 to participate.
The maximum mandatorily insured salary is CHF 82,080.
The employer contributes at least as high a premium as the employee.
Some employers choose to pay more. Premiums can vary
between 7 % and 18 % of income, based on age and sex (the
older the person, the higher the premium). Pension funds are foundations,
cooperatives or public law institutions that are overseen
by cantonal and federal supervisory authorities. Smaller companies
often join a collective pension foundation or association.
8.6.6 Unemployment insurance (UI)
Unemployment insurance continues to pay partial salary upon
unemployment for a limited amount of time and promotes the reentry
of the unemployed person into the job market. It is mandatory
for employees. All workers who are not self-employed must
make contributions. Unemployment insurance is financed equally
by the employer and the employees (each pays 1 %). It is not
possible for self-employed persons to insure themselves against
unemployment, even voluntarily. In order to receive unemployment
benefits, employees must normally be able to demonstrate
payment of at least 12 monthly contributions within the last two
years, so they must have worked. Another requirement is that the
person must be in a position to take up work. Regular contributions
are mandatory. Compensation generally amounts to 70 %
of the salary subject to OASI (average of the last six contribution
months prior to unemployment), or 80 % where there are children
requiring support, in case of disability or for those with an income
of less than CHF 3,797. The maximum insured salary is CHF
10,500 a month. As a rule, a maximum of 400 days’ allowances
may be drawn within a two-year period.
Federal Social Insurance Office
www.bsv.admin.ch
Link: Topics/Occupational Benefit Plan
Languages: German, English, French, Italian
8.6.8 Family allowances
Family allowances go some way towards meeting the costs of
bringing up children. They include child and education allowances,
as well as birth and adoption allowances mandated by the
individual cantons. All cantons require as a minimum the following
allowances per child per month:
• a child allowance of CHF 200 for children up to the age of 16
• an education allowance of CHF 250 for children between the
ages of 16 and 25
In many cantons the amount is higher. All employees and persons
not gainfully employed with a modest income are entitled to these
allowances, and in some cantons self-employed people are too.
There are special rules for farmers. These benefits are financed
almost exclusively by the employer.
78 Handbook for Investors 2010

Calculation of family allowances by canton
www.kinderzulagen-rechner.ch
Languages: German, French
8.7 Recruitment.
There are many options for recruiting external candidates:
• Ads in newspapers or specialist journals
• Online ads
• University notice boards
• External advisors
• Headhunters
• Regional employment centers
• Third parties, etc.
Each employer’s choice depends on its needs and budget.
Regional employment centers
www.treffpunkt-arbeit.ch
Languages: German, English, French, Italian
8.7.1 Public employment service
The regional employment centers (RECs) are public service
providers that specialize in advising and placing jobseekers. The
130 or so RECs personally advise employers in their recruitment
through a personnel consultant. There are many well-qualified job
seekers registered with RECs who are immediately available for
permanent or temporary positions. On request, RECs can screen
applicants by the employer’s criteria, making the selection process
easier. RECs can also advertise open positions in the internal job
market on the network's website and/or on Teletext. The website
is the largest job market in Switzerland, and the key advantage is
that all REC services are free.
8.7.2 Employment agencies
It may be worth using an employment agency to find a highly
qualified specialist or manager. These agencies do most of the
legwork: creating recruitment ads, choosing the media and selecting
candidates. It also makes sense to work with an employment
agency if the name of the company is to be kept confidential due
to industry or internal reasons. However, this method is expensive,
as it may cost one or more months’ salary for the position to be
filled.
8.7.3 Headhunters
Headhunters, or executive search consultants, act as a bridge
between a company’s need for highly qualified specialists and
managers and the desire of such individuals to find challenging
and attractive positions. They specialize in recruiting through
direct contacts and work on a mandate basis. They range from
companies specialized in certain industries to large international
firms with household names and boutique companies specially
suited to generalist tasks, complex jobs or unconventional solutions.
Hiring a headhunter is always beneficial if the usual paths
of internal recruitment or ads on websites and in newspapers fail
to produce results.
8.7.4 Staffing/temporary employment agencies
The hiring of staff for a limited amount of time through temporary
employment agencies is useful if there is a temporary surge of
orders or staff must be replaced at short notice. An hourly wage
is agreed between the agency and the client, which is usually 1.4
to 2 times the normal hourly rate. However, only the hours worked
must be paid, and all ancillary costs are included. The agency
remunerates temporary staff as their employer and is responsible
for all social deductions and insurance. The same labor
law protections apply as with «traditional» forms of employment.
Temporary employment agencies require a cantonal license in
order to operate. They are also required to set aside a significant
deposit to cover the claims of their employees. A federal license
and a higher deposit are required to operate abroad.
Handbook for Investors 2010
79

HR Swiss – Swiss Association for Human Resources
Management
www.sgp.ch
Languages: German, English, French, Italian
swissstaffing
www.vpds.com
Languages: German, French
80 Handbook for Investors 2010

9. Financial center and capital market.
Accounting for 12 % of GDP and employing around 200,000
staff, the Swiss financial sector is of key economic importance.
The main areas of expertise are private banking, asset
management and insurance. Switzerland’s long tradition of
economic and financial stability is reflected in low inflation,
low interest rates and the significant international role that
the Swiss franc plays, particularly in asset management and
issue underwriting business.
9.1 Banks.
9.1.1 Structure and general conditions
In Switzerland there are some 340 banks, 260 insurance companies
and 2,700 pension funds. Apart from the two major global
banks, UBS and Credit Suisse Group, which together hold over
50 % of total assets, the cantonal, regional and savings banks
also play an important role.
Fig. 42: Global financial centers, 2009
Ranking
Financial center
1 London
2 New York
3 Singapore
4 Hong Kong SAR
5 Zurich
6 Geneva
7 Chicago
8 Frankfurt
9 Boston
10 Dublin
Source: The Global Financial Centres Index 5, City of London,
www.cityoflondon.gov.uk/GFCI
In addition, there are many smaller financial institutions and
private banks, some of which offer highly specialized services
such as commodity trade finance. The group of 24 cantonal
banks, which are either entirely or partially under state ownership
and which offer a government guarantee, have a domestic
market share of about a third. Their share of total assets for all
banks domiciled in Switzerland was approximately 13 % in 2004.
Another 150 foreign financial institutions, mainly from the rest
of Europe (110 institutions) and North America (19 institutions),
can be added to this number, making around 44 % of all banks in
Switzerland. 85 % of these are active in private banking. In 2007,
Swiss banks managed over CHF 4,900 billion in assets, of which
nearly 60 % came from foreign countries. Switzerland is a center
for professional asset management for private clients and institutional
investors. With a market share of 27 % in 2009, it is the
world leader in cross-border asset management business.
Handbook for Investors 2010
81

Switzerland’s success as a financial center is thanks to the combined
effect of many different factors. Its political and macroeconomic
stability are the basic foundation upon which clients’
trust is built – trust which is so important in financial business.
The Swiss franc, with its status as an important international
reserve and diversification currency, also contributes to this.
Strong glo bal integration and an efficient financial infrastructure
allow market participants to achieve profitable management and
international diversification of their assets and risks. Switzerland
as a financial center enjoys a good reputation abroad, and it is an
attractive location for businesses and an international clientele.
In comparison with other countries, the Swiss banking system is
not heavily regulated. A permit is required to open a bank, trade
professionally in securities, manage a fund and in some cases to
operate as an asset manager.
The Swiss Financial Market Supervisory Authority FINMA, currently
supervising over 400 financial institutions, can provide
detailed information about specific requirements. The umbrella
organization for the banking industry is the Swiss Bankers
Association.
Swiss Bankers Association
www.swissbanking.org
Languages: German, English, French, Italian
All banks operating in Switzerland require a license. The supervisory
standards applied in Switzerland not only govern the capital
resources and adequacy of the banks but also include the whole
range of prudential rules and codes of conduct. As an additional
safety cushion, Swiss law specifies higher capital requirements
than does the Basel Capital Accord.
Swiss Financial Market Supervisory Authority FINMA
www.finma.ch
Languages: German, English, French, Italian
9.1.3 Services
Banks in Switzerland offer a vast range of financial products and
services for both private and corporate clients. As the Swiss
banking system is based on the universal bank principle, all
banks can offer all banking services, such as:
• Credit or lending business
• Asset management and investment advice
• Payment transactions
• Deposit business (savings accounts, etc.)
• Securities business (stock market trading)
• Issue underwriting business (bond underwriting)
• Financial analysis
Despite this, very different groups of banks and areas of specialization
have developed.
9.1.2 Supervision
Under the Financial Market Supervisory Act (Finanzmarktaufsichtsgesetz
FINMAG), the Federal Office of Private Insurance
(Bundesamt für Privatversicherungen BPV), the Swiss Federal
Banking Commission (Eidgenössische Bankenkommission EBK)
and the Federal Money Laundering Control Authority (Kontrollstelle
für die Bekämpfung der Geldwäscherei Kst GwG) were
merged to form the Swiss Financial Market Supervisory Authority
(Eidgenössische Finanzmarktaufsicht FINMA) with effect from
January 1, 2009. As an independent supervisory authority, FINMA
protects financial market clients, namely creditors, investors and
insured persons, thus strengthening public trust in Switzerland as
a functioning, reliable and competitive financial center.
Generally speaking, any adult may open a bank account in Switzerland.
However, the banks reserve the right to refuse to accept
a client. For example, a bank may refuse to enter into a business
relationship with «politically exposed persons,» as such clients
could represent a reputational risk for the bank. The same applies
in principle to companies, irrespective of whether they are domiciled
in Switzerland. Most Swiss banks do not require a minimum
deposit for normal savings or current accounts. Many banks offer
accounts in euros, US dollars or other currencies, as well as in
Swiss francs.
If clients have a specific complaint against a bank that is domiciled
in Switzerland, they may approach the Swiss banking ombudsman,
who provides neutral, free information and mediation.
82 Handbook for Investors 2010

Cantonal banks
Deposit Protection of Swiss Banks and Securities Dealers
www.kantonalbank.ch
Languages: German, English, French, Italian
www.einlagensicherung.ch
Languages: German, English, French, Italian
Association of Foreign Banks in Switzerland
www.foreignbanks.ch
Languages: German, English, French, Italian
Swiss Private Bankers Association
www.swissprivatebankers.com
Languages: German, English, French
9.1.5 Taxation of savings income
Switzerland supports the EU system of taxing cross-border interest
payments to individuals under the Savings Tax Agreement. Swiss
banks operate a system of tax retention (similar to Swiss withholding
tax) on interest income earned in Switzerland by persons
subject to EU taxation, currently at a rate of 15 % (to be raised
incrementally to 35 % by July 2011). This system of tax retention
ensures that the EU interest taxation system cannot be evaded
by switching to Switzerland, while at the same time ensuring that
Swiss laws and banking secrecy are upheld.
Taxation of savings income
Banking ombudsman
www.europa.admin.ch
Languages: German, English, French, Italian
www.bankingombudsman.ch
Languages: German, English, French, Italian
9.1.4 Protection of deposits
Since the increase enacted on December 22, 2008, deposits with
Swiss financial institutions are protected up to CHF 100,000 per
depositor. If the Swiss Financial Market Supervisory Authority
(FINMA) initiates protective measures or forced liquidation proceedings
against a bank or securities dealer in Switzerland, the
members of the Swiss Banks’ and Securities Dealers’ Depositor
Protection Association provide funds so that the deposits deemed
preferential under the Banking Act can be paid out as quickly as
possible to depositors. All banks and securities dealers with a
branch in Switzerland are members of the association. However,
the maximum amount that members may be required to contribute
is capped at CHF 6 billion. By guaranteeing preferential deposits,
the association plays an important role in protecting creditors
and makes a key contribution to the reputation and stability of
Switzerland as a financial center.
9.2 Swiss stock market: SIX Swiss
Exchange.
The strength of the Swiss financial center, its position as a world
leader in cross-border private asset management and the associated
high level of financing and placing power enjoyed by its
banks, and the general attractiveness of Switzerland as a location
make the SIX Swiss Exchange extremely appealing for both
domestic and foreign companies. Foreign companies account
for 25% of the companies listed on the SIX Swiss Exchange, a
higher proportion than any other exchange in Europe apart from
the London Stock Exchange (also 25%).
Public placement and listing on the SIX Swiss Exchange gives a
company access to an experienced, financially powerful group
of international investors. With an average of ten IPOs per year
in a positive market environment, transparency over transaction
volumes and a manageable range of listed companies, every
Handbook for Investors 2010
83

company on the SIX Swiss Exchange benefits from a high level of
visibility and attention from investors, analysts and journalists. At
the same time, investors in Switzerland have many years of experience
of international sector-oriented investment strategies. Given
Switzerland’s economic structure, the banking and insurance, food,
pharmaceutical, biotech, medtech and cleantech, and micro and
nanotechnology sectors are particularly popular with investors.
9.3 Business lending and real estate
financing.
Establishing a business is generally a medium to long-term objective.
As a rule, significant up-front investments and project financing
are needed. Banks place great emphasis on thorough market
analysis and professional management.
In addition, the regulatory provisions of the SIX Swiss Exchange
reflect market realities and thus simplify the capital increase
process. Under Swiss legislation, the SIX Swiss Exchange has
powers of self-regulation and so is ideally equipped to combine
high levels of investor protection with a regulatory environment
that is reasonable from a company perspective.
The SIX Swiss Exchange is part of the SIX Group, which covers
the entire value chain within Switzerland’s financial market and
also operates internationally. Securities trading, associated
processing of transactions, provision of financial information and
payment transactions are all performed by a single organization.
In addition to its broad product range, its fully integrated and
completely automated trading, clearing and settlement system is
very strong. Orders are executed, cleared, paid for and confirmed
at the click of a mouse. The SIX Swiss Exchange is the home
exchange and market for shares in leading international companies
such as Novartis, Nestlé, Roche, ABB and UBS. The indices
provided by the SIX Swiss Exchange are therefore of global importance
and highly regarded. The best-known index, the Swiss
Market Index SMI ® , comprises the 20 largest and most liquid
stocks on the Swiss equity market.
Swiss stock exchange
www.six-swiss-exchange.com
Languages: German, English, French
SIX Group
www.six-group.com
Languages: German, English, French
9.3.1 Financing of current business activity
To finance current business activities, banks grant various types
of short-term loans. These can take the form of unsecured loans
or loans secured by collateral. The amount of the loan granted
depends on the trustworthiness and the future prospects of the
company. Aside from the usual forms of bank lending, lease
financing and forfeiting are also gaining in importance. For rapidly
growing young enterprises and start-ups deciding on a location,
it is important to know what financing possibilities exist for the
start-up phase and the second step. The sheer range and quality
of financial service providers in Switzerland means that a variety
of attractive solutions are available, such as sureties, convertible
loans and forms of financing along venture capital lines.
When a new business is established in Switzerland, financing in
Swiss francs should be preferred because of currency considerations.
As a rule it is also more economical.
9.3.2 Mortgages
If the acquisition of real estate or the building of a production
facility accompanies the foundation or establishment of a business,
mortgages can be an important credit instrument. There are
three main types of mortgage in Switzerland: fixed-rate, variablerate
and money-market mortgages. While the interest rate for a
variable-rate mortgage is continually adjusted to the prevailing
capital market rate, the interest rate on a fixed-rate mortgage is
typically fixed for three to five years. The interest rate on a moneymarket
mortgage is based on the Libor rate for the euro money
market. Providers add a margin on top of this rate, which depends
on the credit quality of the borrower. Up to 80 % of the property’s
market value may be borrowed; up to 65 % of this is taken as a
first mortgage, which does not need to be amortized as is usual
in other countries. Over and above this, a second mortgage must
be taken out which does have to be amortized. The bank checks
the quality of the property and the creditworthiness of the borrower
in accordance with its own guidelines. Generally speaking,
84 Handbook for Investors 2010

a minimum requirement is that purchasers should provide at least
20 % of the purchase price from their own assets. Secondly, the
annual cost of the purchase (interest, repayments and maintenance)
should not total more than one-third of the purchaser’s
gross income. Interest rates are negotiable, so it is worthwhile
requesting offers from a number of lenders.
For commercial property, the collateral value depends increasingly
on the earning-power value. For industrial projects, normally 50 %
of the total plant value – market value or construction cost, including
machinery and equipment – can be financed against real estate
pledges at very attractive rates.
For office and service buildings, the loan to value ratio is normally
around 70 %, but it also depends on the (property-specific) risks.
Interest rates and terms generally applied to business investments
today depend on the creditworthiness of the company and
the rating it is given by the lending bank. Recognition of the risk
and future prospects therefore plays a key role.
Owners of residential property must pay federal and cantonal
taxes on their property as notional income. The rule of thumb for
federal tax is an imputed rental value of at least 70 % of average
market rental, and for cantonal and municipal taxes an imputed
rental value of at least 60 %. In return, homeowners may deduct
mortgage interest and maintenance costs. This is the reason why
the first mortgage is rarely amortized.
Tips and advice
www.hausinfo.ch
Languages: German, French
Calculation of financial viability
www.kantonalbank.ch
Search under: Berechnungstools (calculation tools)
Languages: German, French, Italian
Fig. 43: Mortgage interest rates, 1985 – 2009
12 %
10 %
8 %
6 %
5-year fixed-rate mortgages
Variable-rate mortgages
Libor mortgages
Reference interest rate: government bonds (10 years)
4 %
2 %
0 %
1985
1990
1995
2000
2005
2010
Source: VZ VermögensZentrum, www.vzonline.ch
Handbook for Investors 2010
85

9.4 Risk capital.
The number of venture capital companies in Switzerland has
grown considerably. The source of funds has shifted significantly
away from private investors, with government agencies accounting
for 24.5 %, followed by insurance companies and pension funds
with 22 % and 18.7 % of the total, respectively. The federal authorities
also support the creation of venture capital through the
Federal Act on Venture Capital Companies (RKG), which provides
two tax incentives:
• Recognized venture capital companies are exempt from
securities issue tax on their capital at the time the company is
founded, or for any subsequent capital increase. With respect
to direct federal tax, they also have a lower threshold value for
claiming the equity participation deduction.
• Private persons who assist in the foundation and development
of new companies as business angels are entitled to relief from
direct federal tax if they grant subordinated loans for the formation
of start-up companies from their private assets.
9.4.1 Venture capital
Some financial companies specialize in providing risk capital
or venture capital. Venture capital firms contribute to the share
capital of a company, with the aim of making large profits if it
flourishes or goes public. They provide financial resources without
requiring the traditional forms of security. Only fast-growing
young companies which are likely to generate significant revenue
in a short period of time and, generally speaking, have a capital
requirement of several million Swiss francs will have the opportunity
of benefiting from this kind of financing. Venture capitalists
consider themselves to be guides during the development phase
of the financing project. After their job is done, they generally
withdraw and sell their investment on to new investors.
Venture capital
www.kmu.admin.ch
Languages: German, French, Italian
The availability of venture capital and similar financing may fluctuate
and therefore lacks transparency. Universities, consultants
and the business community jointly provide a number of platforms,
some of them online, to bring entrepreneurs and investors
together.
Information platform and network for entrepreneurs
www.swiss-venture-club.ch
Languages: German, French, Italian
Companies and funds providing risk capital
www.swissbanking.org
Search under: Risikokapital (risk capital)
Languages: German, French, Italian
Swiss Private Equity & Corporate Finance Association
(SECA)
www.seca.ch
Languages: German, English, French
9.4.2 Business angels
During their start-up phase, many promising young companies
need seed finance of less than CHF 2 million. Although risk capital
is increasingly available these days, the minimum size of a financing
transaction has risen correspondingly for both risk capital providers
and investment companies. Very few venture capitalists will now
consider financing deals of less than CHF 2 million.
More and more often it is «business angels» – individual investors
– who finance start-ups. During the initial phase, at least, they
often also act as advisor and mentor to the new entrepreneur,
who therefore enjoys the benefit of «smart money.» Despite their
name, business angels are not charitable donors. Just like venture
capitalists, they want to earn a profit on their investment, so
they expect to take a very close look at the entrepreneur’s business
plans. In Switzerland, venture capital companies and private
investors benefit from relief on direct federal tax and are exempt
from securities issue tax.
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Business angels in Switzerland
www.businessangels.ch
Languages: German, French
9.4.3 State support
Although there is relatively little direct financial assistance available
in Switzerland, where the state mainly restricts itself to creating
favorable operating conditions, the country does offer a wide
variety of tools to support companies, ranging from administrative
assistance and tax relief to guarantees.
The cantonal economic development agencies also tend not to
take direct stakes in companies, although they can offer assistance
in finding affordable construction sites or can provide tax
relief during the start-up phase or during a planned expansion.
One rare exception is the Swiss Federal Foundation for the Promotion
of the Swiss Economy (Eidgenössische Stiftung zur Förderung
schweizerischer Volkswirtschaft), which grants interest-free loans
and, in exceptional cases, may even provide a share of the risk
capital subject to a personal financial commitment on the part of
the company founder.
For further information see section 14.
State support for financing
www.kmu.admin.ch
Search under: Staatliche Unterstützung (state support)
Languages: German, French, Italian
Fig. 44: State incentives
Incentive Beneficiaries Legally defined areas Measures
New regional policy Industry, manufacturing-related
Areas of application • Tax relief on direct federal tax
NRP
service
companies
pursuant to the ordinance
of the Federal
Department of Economic
Affairs
Commercial guarantees SMEs, business, startup
Whole of Switzerland • Guarantees for bank loans (max. CHF 500,000)
companies
Guarantees for mountain
regions
SMEs, business, startup
companies
Mountain regions • Guarantees for bank loans (max. CHF 500,000)
• Interest cost subsidies
Hotel lending Hotel industry Tourism and mountain
regions
• Direct loans
• Guarantees
• Interest cost subsidies (partial)
Measures to encourage
self-employment
Unemployed Whole of Switzerland • Daily benefits (max. 90 days for planning phase)
• Guarantees for bank loans (max. CHF 180,000)
KTI/CTI Innovation
Promotion Agency
Joint research projects
bringing universities and
companies together
Whole of Switzerland • Payment of researchers’ salaries
Handbook for Investors 2010
87

9.5 Capital costs and interest.
Switzerland is one of the most economically and politically stable
countries in the world and is known as a safe haven. The country
is in a healthy financial situation. This applies to the finances of
the central state – at federal level – as well as the cantons and
municipalities. The budget deficit of 1 % of GDP is significantly
below the average of EU and OECD member countries. Total
public sector debt (federal, cantonal and municipal) amounts to
44 % of GDP.
By comparison with the OECD, from a government debt perspective
only, Switzerland’s debt ratio is in the middle range. Some
European countries and the US have higher ratios, while only
Norway, Luxembourg and Ireland have much lower levels. Consequently,
Switzerland remains one of the least indebted countries
in Europe.
Fig. 45: Credit rating: the ten safest countries
Rank Country Number of points
(maximum = 100)
1 Luxembourg 99.88
2 Norway 97.47
3 Switzerland 96.21
4 Denmark 93.39
5 Sweden 92.96
6 Ireland 92.36
7 Austria 92.25
8 Finland 91.95
9 Netherlands 91.95
10 US 91.27
Fig. 46: Capital costs, 2009
1 = hinders economic growth,
10 = promotes economic growth
1 Switzerland 6.69
2 Japan 6.30
3 Sweden 6.13
4 Malaysia 5.88
5 Hong Kong SAR 5.63
10 Belgium 5.29
11 Singapore 5.29
13 Ireland 5.15
14 Netherlands 5.12
17 Denmark 4.99
18 Luxembourg 4.98
20 Germany 4.88
21 USA 4.88
22 Italy 4.87
27 France 4.72
34 UK 4.15
38 India 3.93
43 People’s Republic of China 3.65
50 Russia 2.70
56 Brazil 1.85
Source: 2009 IMD World Competitiveness Yearbook
Source: Euromoney, www.euromoney.com, March 2008
High credit quality, together with the high savings rate and large
inflows of foreign money, lead to low interest rates, meaning that
financing conditions for business and investment are comparatively
favorable. In recent years, the average spread in the money
market and capital market interest rates in Swiss francs and euros
has ranged between 1.5 % and 2 %. Interest rates and terms may
vary widely depending on the creditworthiness of the client.
88 Handbook for Investors 2010

9.6 Inflation.
Switzerland has always lived up to its reputation as a stable
country. The rate of inflation, as measured using the Swiss consumer
price index, has consistently remained well below those
of the EU and the major industrialized nations in recent years.
Fig. 47: Inflation
40 %
35 %
30 %
25 %
20 %
15 %
10 %
5 %
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
World Major advanced economies (G7) European Union
ASEAN-5
Switzerland
Source: IMF WEO Report, October 2008
Swiss consumer price index
Swiss Federal Finance Administration
www.LIK.bfs.admin.ch
Languages: German, French, Italian
www.efv.admin.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
89

10. Overview of the Swiss tax system.
The Swiss tax system mirrors Switzerland’s federal structure,
which consists of 26 sovereign cantons with approximately
2,650 independent municipalities. Based on the constitution,
all cantons have the full right of taxation except for those
taxes that are exclusively reserved for the federal government.
As a consequence, Switzerland has two levels of taxation
– the federal and the cantonal/municipal level.
The accomplished reform of the income tax system in recent
years provided for harmonization of the formal aspects of
the various cantonal tax laws – for example, determination of
taxable income, deductions, tax periods, assessment procedures,
etc. The cantons and municipalities have however still
significant autonomy for the quantitative aspects of taxation,
particularly with respect to determining the applicable
tax rates. Therefore, the tax burden still considerably differs
between cantons/communes.
10.1 Taxation of corporate
taxpayers.
10.1.1 Corporate income tax – federal level
The Swiss Federation levies corporate income tax at a flat rate
of 8.5 % on profit after tax of corporations and cooperatives.
For associations, foundations and other legal entities as well as
investment trusts a flat rate of 4.25 % applies. On the federal level
no capital tax is levied.
Taxable persons
Taxable persons include Swiss resident legal entities, i.e., Swiss
corporations, limited liability companies and corporations with
unlimited partners, cooperatives, foundations and investment
trusts with direct ownership of immovable property. As partnerships
are transparent for tax purposes, the partners are taxed
individually. Companies which have their registered office or place
of effective management in Switzerland are considered resident.
Taxable income
Resident companies are subject to corporate income tax on their
worldwide income with the exception of income attributable to
foreign permanent establishments or foreign immovable property.
Such income is excluded from the Swiss tax base and is only
taken into account for rate progression purposes in cantons that
still apply progressive tax rates.
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Non-resident companies are subject to tax only on Swiss source
income, i.e., income and capital gains derived from Swiss business,
permanent establishments or immovable property, whereas
income from immovable property includes income from trading in
immovable property.
As a matter of principle, the statutory accounts of a Swiss
company and – in the case of a foreign company – the branch
accounts form the basis for determining taxable income. Apart
from the participation exemption for dividend and capital gains
income, various adjustments required by tax law and the use of
existing loss carryforwards (the loss carryforward period is seven
years), there are very few differences between statutory profit
and taxable profit. The most common deductions allowed are
depreciation, tax expense, interest expense and management and
service fees/royalties. The last two are deductible to the extent
that they are in accordance with the arm’s-length principle.
Thin capitalization
The Swiss Federal Tax Administration has issued safe harbor
rules for thin capitalization purposes that apply to related party
debt. Third-party financing is not affected by those rules. Specifically
speaking, a unique asset-based test is used to determine
whether a company is adequately financed. The thin capitalization
rules require that each asset class (in general, fair market value,
but often the lower book values suffice) has to be underpinned by
a certain equity portion.
Related-party debt exceeding the allowable debt as calculated
according to the percentages provided by the Federal Tax
Administration is reclassified as equity and added back to the
taxable capital for purposes of the cantonal/municipal annual
capital tax, unless it can be proven that in this particular case the
debt terms applied are more appropriate.
Moreover, the allowable interest deductibility on debt can be
determined by multiplying the allowable debt by the safe harbor
interest rates. If interest payments to related parties exceed the
amount which can be paid based on the allowable debt, they are
added back to taxable profit. Further, such interest is considered
to be a hidden dividend distribution (subject to withholding tax of
35 %).
Group consolidation
Separate entity taxation applies in Switzerland for income tax
purposes. Group consolidation is not anticipated to be introduced
in the near future.
Group reorganizations
Group reorganizations are governed by the Swiss merger law
which regulates reorganizations and mergers from both a tax and
legal perspective and are, if certain conditions are met, possible
on a tax neutral basis to the extent that the assets remain in
Switzerland and the tax book values of the assets and liabilities
remain unchanged.
10.1.2 Corporate income tax – cantonal and municipal level
Given the tax harmonization on the cantonal and municipal levels,
most tax rules are identical or very similar to the rules on the
federal level set forth above (e.g. participation exemption, loss
carryforward rules and in most cases thin capitalization rules).
Special tax regimes
In contrast to the Swiss federal tax law, all cantonal tax laws offer
special tax regimes, which may be obtained provided that the
conditions according to the tax harmonization law are met. The
following tax regimes are typically prevalent in Switzerland and
relevant internationally:
A) Holding company
The holding company tax status is available to Swiss companies
(or permanent establishments of a foreign company), whose
primary purpose is according to the by-laws to hold and manage
long-term equity investments in affiliated companies. Furthermore,
the company must pass an alternative asset or income test,
whereby either two-thirds of the company’s assets must consist
of substantial shareholdings or participations or two-thirds of
total income of the company must consist of participation income
(dividend income or capital gains) from such shareholdings and
participations.
Handbook for Investors 2010
91

A qualifying holding company is exempt from all cantonal/municipal
income taxes with the exception of income from Swiss real estate
which is subject to tax after deduction of typical mortgage expenditures
on such real estate. As a matter of principle, the effective tax
rate of a holding is 7.83% (i.e., federal income tax rate) prior to participation
relief for qualifying dividends and capital gains. A reduced
capital tax on the cantonal/municipal tax level applies.
B) Mixed trading company
It has been given different names by the cantons. However, in the
international context the tax status is most often referred to as the
«mixed trading company» tax status.
A mixed company may be engaged in limited commercial business
activity in Switzerland. As a general rule, at least 80 % of the
income from commercial activities must derive from non-Swiss
sources (i.e., a maximum of 20 % of income may be linked to
Swiss sources). Many cantons additionally require that at least
80 % of costs must be related to activities undertaken abroad.
The tax rates vary from canton to canton and depend on the tax
status of the company. In 2009, the range was between 0.0010%
to 0.5288 % for companies subject to ordinary taxation, and between
0.0010 % to 0.4028 % for companies eligible for a special
tax regime.
10.1.4 Tax incentives
Switzerland offers tax incentives on the federal as well as the
cantonal level. It should, however, be noted that federal tax incentives
may only be granted in explicitly defined regions.
Federal level
The federal government has defined less centralized and/or economically
less strong regions which are entitled to grant business
incentives including partial or full corporate income tax breaks for
up to 10 years. Tax breaks are available for investment projects
that fulfill certain conditions such as creation of new production
related jobs, non-competition with existing businesses, etc. (see
section 14.5).
If a company meets the above criteria, it may apply for tax treatment
in accordance with the following rules:
• Qualifying income from participations (including dividends,
capital gains and revaluation gains) is exempt.
• Other income from Swiss sources is taxed at the normal rate.
• A portion of foreign source income is subject to cantonal/
municipal income taxes depending on the degree of business
activity carried out in Switzerland.
• Expenditure that is justified for business purposes and is related
economically to certain income and revenues is deductible.
In particular, losses from participations can only be offset
against taxable income from participations (i.e., income that is
not obtained tax-free).
• Reduced capital tax rates are applicable.
Cantonal and municipal level
Most cantons offer partial or full tax breaks for cantonal/municipal
tax purposes for up to 10 years on a case-by-case basis. In particular,
incentives may be obtained for creating a new presence or
for an expansion project that has particular economic relevance
for the canton. Most importantly, however, business incentives
are generally granted in connection with the creation of new jobs
locally. The requirement is 10 to 20 jobs in most cantons.
10.1.3 Capital tax
Only cantons levy an annual capital tax on the cantonal or
municipal tax level. The basis for the calculation of capital tax is
in principle the company’s net equity (i.e., share capital, paid-in
surplus, legal reserves, other reserves, unappropriated retained
earnings). The taxable base of companies also includes any
provisions disallowed as deductions for tax purposes, any other
undisclosed reserves, as well as debt that economically has the
character of equity under the Swiss thin capitalization rules. Some
cantons even provide for crediting the cantonal corporate income
tax against capital tax.
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10.2 Tax charge rate in international
comparison.
The international comparison of the total tax rate (TTR) shows
that Switzerland constantly has a very competitive tax system
compared to other highly developed industrial countries. The total
tax rate (TTR) measures the amount of all taxes and mandatory
contributions borne by the business and is expressed as
a percentage of commercial profits. The business report 2009
reflects the TTR for the fiscal years 2006 and 2007 (January 1 to
December 31, 2006 and 2007). The total amount of taxes borne is
the sum of all the different taxes and contributions payable after
accounting for deductions and exemptions.
The taxes and contributions included can be divided into the
following categories: a) profit or corporate income tax; b) social
contributions and labor taxes paid by the employer (for which all
mandatory contributions are included, even if paid to a private
entity such as a pension fund); c) property taxes; d) sales taxes
(and cascading sales taxes as well as other consumption taxes
such as irrecoverable VAT); and e) other taxes (such as
municipal fees and vehicle and fuel taxes).
It should further be noted that the Swiss tax system is not only
attractive for corporate taxpayers but also for individual taxpayers
as it provides for a modest tax burden in international comparison
as well.
Fig. 48: Total tax rate (TTR)
Luxembourg 21.0
35.3
Ireland 28.8
28.9
Switzerland 28.9
29.1
UK 35.3
35.7
Netherlands 39.1
43.4
USA 42.3
46.2
Finland 47.8
47.8
Czech Republic 48.6
48.6
Russia 48.7
51.4
Germany 50.5
50.8
Sweden 54.5
54.5
Austria 54.5
54.6
Japan 55.4
52.0
Hungary 57.5
55.1
Belgium 58.1
64.3
Spain 60.2
62.0
France 65.4
66.3
Brazil 69.4
69.2
India 71.5
70.6
Italy 73.3
76.2
People’s Republic of China 79.9
73
73.9
TTR (% profit) 2007
TTR (% profit) 2006
Handbook for Investors 2010
93

10.3 Taxation of individual
taxpayers.
10.3.1 Personal income tax
Taxable persons
Individuals are subject to taxation on the federal and cantonal/
municipal levels if they have their permanent or temporary residence
in Switzerland. Temporary residence is given provided the
individual stays in Switzerland for a) at least 30 days carrying out
a professional activity or b) for 90 days or more without pursuing
any professional activity. According to the Swiss tax system, partnerships
are transparent; hence each partner is taxed individually.
The income of married couples is aggregated and taxed according
to the principle of family taxation. Any income of a minor child
is added to the income of the adults with the exception of the
child’s earned income derived from gainful employment, which is
assessed separately.
The federal as well as cantonal/municipal income taxes are levied
and collected by the cantonal tax authorities and are assessed for
a period of one year (calendar year) on the basis of a tax return to
be filed by the taxpayer.
Taxable income
Resident individuals are subject to tax on their worldwide income.
However, revenues derived from business carried on abroad, from
permanent establishments and from immovable property situated
abroad are exempt and are taken into account only for the determination
of the applicable tax rate (exemption with progression).
The total income includes income from dependent or independent
personal activities, income from compensatory or subsidiary
payments, and income from movable and immovable property.
Certain types of income such as inheritance, gift and matrimonial
property rights, subsidies paid from private or public sources,
etc., are by law excluded from taxation. Moreover, the individual
may deduct earning costs including, for example, travel costs between
home and place of work, social security contributions and
contributions to approved savings plans from gross income.
Additional deductions may be claimed for dependent children
and insurance premiums as well as for married and double
income couples. However, the extent of deductions allowed may
vary from canton to canton. Further interest payments on loans,
mortgage loans, etc., are fully deductible for business purposes.
The deductibility of interest related to private assets, however, is
limited to an aggregate income from movable and immovable assets
plus CHF 50,000. Draft legislation providing for the abolition
of taxation on own rental value for all homeowners is currently being
debated. This would also limit the existing scope for deduction
of personal interest on debt to the taxable yield on assets.
Individual tax rates are typically progressive, with a maximum tax
rate of 11.5 % applicable at the federal level. The cantons may set
their own tax rates. The maximum applicable cantonal tax rates
hence vary significantly from canton to canton (principal town of
the canton about 12 % to 30 %).
Capital gains
Depending on whether a capital gain is realized on personal or
business property or on movable or immovable property, such
gain is taxed differently. Gains on movable personal property are
exempt from taxation whereas gains realized on movable business
property are attributed to ordinary income. For taxation of
immovable property, please also see 10.6.2.
Losses
Contrary to personal losses, business losses are tax deductible
and may be carried forward for 7 years.
10.3.2 Wealth tax
Net wealth tax is only levied on the cantonal/municipal level according
to the respective cantonal tax laws and rates. The tax is
based on the balance of the gross assets including but not limited
to immovable property, movable assets such as securities and
bank deposits, cash redemption value of life insurance, cars, etc.
Taxes are also levied on assets not yielding any income.
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10.3.3 Expatriates
Qualifying expatriates are foreign managers and certain specialists
(e.g., IT specialists) seconded to Switzerland on a temporary
basis for a period of up to five years, i.e., the (assignment)
contract has to be limited in time for a maximum of five years.
Expatriates may claim tax relief on expenses incurred due to their
stay in Switzerland.
The following expenses incurred by expatriates are deductible:
i) relocation costs including travel costs to and from Switzerland,
ii) reasonable accommodation costs in Switzerland while still
maintaining a residence abroad, iii) costs for school-age children
attending a private school if local state-funded schools cannot
offer adequate educational provisions. Instead of identifying the
actual costs for relocation and accommodation, the taxpayer
may claim a monthly lump-sum deduction which may vary from
canton to canton. Any reimbursement of work-related costs of the
expatriate by the employer must be declared in the employee’s
salary slip.
The entitlement to benefit from the expatriates’ status for tax
purposes ceases once temporary employment is replaced or
superseded by a permanent position.
10.3.4 Cross-border commuters
Cross-border commuters are those people who live abroad
(e.g., in Austria, France, Germany, Italy or Liechtenstein) and work
in Switzerland, commuting from home to work and back each
day.
The Swiss taxation of such individuals differs, depending on their
place of work and domicile (home or foreign country). The double
tax treaty with Germany, for example, provides for an apportionment
of the taxation right between the two countries. The country
of work is limited to a flat rate withholding tax of 4.5 % of the
gross salary of the cross-border commuter. Such partial taxation
of cross-border commuters in the country of work does not
relieve the commuter from taxation of the earned income at the
place of residence (e.g., taxation with credit). The cross-border
commuter status is abandoned if the employee does not return to
his domicile abroad on more than 60 working days per year.
10.3.5 Lump-sum taxation
Both federal and cantonal tax legislation provides for the option of
a special tax arrangement often referred to as lump-sum taxation,
whereby qualifying Swiss resident taxpayers are taxed on the
basis of expenditures and cost of living in Switzerland instead of
the usual worldwide income and assets.
Qualifying taxpayers who may apply for lump-sum taxation are
individuals who take up temporary or permanent residence in
Switzerland for the first time or after an absence of at least ten
years and who do not carry out any gainful occupation in Switzerland.
While Swiss nationals may only apply for this arrangement
in the tax period of taking up residency, foreigners are allowed to
apply for an indefinite period, provided that the conditions are fulfilled.
The lump-sum taxation provisions are tailored to financially
independent persons who are not seeking to work in Switzerland.
In the case of spouses moving to Switzerland, the provisions
for benefiting from lump-sum taxation must be fulfilled by both
spouses. As a rule, it is not possible for one spouse to be taxed
under lump-sum taxation while the other spouse is taxed under the
regular system.
The basis of taxation is calculated annually on expenses incurred
by the taxpayer in Switzerland and abroad. The calculation does
not only consider the expenses of the taxpayer but also those of
the spouse and dependent children as long as they live in Switzerland.
Expenses usually taken into account are food, clothing
and accommodation, education, leisure activities and all other
expenses linked with the standard of living. The exact calculation
is determined together with the relevant tax authorities of the
canton in which the person wishes to become a resident. In each
case, the minimum base must correspond either to a) at least five
times the rent paid on rental property or five times the imputed
income attributable to homeowners or b) two times the annual
costs of lodging if the taxpayer lives in a hotel or similar accommodation.
If the taxpayer owns or rents more than one property,
the most expensive will be taken into account.
Generally, individuals who apply for lump-sum taxation are considered
Swiss residents and may also apply for treaty relief on
their foreign-source income. Some treaties however allow only for
treaty benefits if all income from the source country is subject to
ordinary taxation in Switzerland.
Handbook for Investors 2010
95

In 2009, a poll in the Canton of Zurich demanded the abolishment
of lump-sum taxation on the cantonal and municipal levels.
As the population of the Canton of Zurich accepted the draft, the
special tax arrangement will no longer be available in Zurich after
January 1, 2010. Other cantons may follow.
10.3.6 Inheritance and gift tax
Inheritance and gift taxes are not harmonized. Consequently, the
cantons are free to levy such taxes, and the various cantonal laws
differ considerably in almost every respect. With the exception
of the Canton of Schwyz, all cantons levy inheritance and/or gift
taxes if the deceased or donor had been a resident of the respective
canton or if real estate located in the canton is transferred.
Inheritance and gift tax rates are mostly progressive and are usually
based on the degree of relationship between the deceased
or donor and the beneficiary and/or the amount received by the
beneficiary. In all cantons, spouses are exempt from inheritance
and gift taxes; most cantons also exempt direct descendants.
10.4 Withholding tax.
A federal withholding tax is levied at the source on the gross
amount of dividend distributions by Swiss companies, on income
from bonds and similar indebtedness by Swiss issuers, as well as
on certain distributions of income by Swiss investment funds and
interest payments on deposits with Swiss banking establishments.
Lottery gains and insurance benefits are subject to withholding
tax as well.
Generally, the debtor is liable for the tax and is required to withhold
the amount due, irrespective of whether the recipient is entitled
to a full or partial refund. A refund is only possible provided
that the respective earnings are properly declared for the purposes
of income taxation. The aim is to prevent tax evasion. For
Swiss resident corporate taxpayers withholding tax is reimbursed
by way of a refund, whereas for individuals the tax is credited
against total tax liability through the regular taxation procedure.
For non-resident taxpayers, the withholding tax represents a final
tax burden. However, a partial or total refund may be granted
based on an international double tax treaty or a bilateral agreement
concluded by Switzerland with the country in which the
recipient of the earnings is residing.
It should further be noted that a notification procedure may be
applied for certain qualifying dividend distributions, replacing the
withholding and refund procedure.
10.4.1 Domestic rates
The tax rate applied on dividend distributions including deemed
profit distributions and interest payments relating to bonds and
bond-like loans as well as on interest payments made by banks
or bank-like institutions to non-banks is 35 %. There is no withholding
tax on interest payments relating to qualifying ordinary
company loan agreements. Provided that royalties, licenses, service
and similar fees payable by Swiss individuals or corporations
are at arm’s length, no withholding tax is levied.
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10.4.2 Treaty rates
Most treaties provide for a reduction of the normal 35 % rate on
dividends. The reduced rate is usually 15 % for portfolio investors
and 0 %, 5 % or 10 % for substantial corporate owners. Some
treaties require the taxation of Swiss-source income in the recipient’s
country of residence. Otherwise no relief will be granted.
With regard to interests, most treaties allow for a reduction as
well, typically up to 10 %. In some treaties a full refund is granted.
However, any reduction is only possible if the person applying for
treaty benefits is actually entitled to claim the treaty.
10.4.3 Bilateral agreements with the EU
In May 2004, Switzerland and the European Union (EU) agreed on
eight bilateral agreements (Bilateral Agreements II) in addition to
the seven existing bilateral agreements (Bilateral Agreements I, in
force since June 1, 2002).
One of the agreements is the Savings Tax Agreement providing
for measures equivalent to those laid down in the EU Savings
Tax Directive. To entice Switzerland to enter into the Savings Tax
Agreement, the same agreement also incorporated language
which was practically identical to the version of the EU Parent/
Subsidiary Directive and the EU Interest/Royalty Directive in effect
at that time. Switzerland has therefore had de facto access to
the respective EU directives since July 1, 2005, whereas future
changes to the EU directives will not automatically apply to Switzerland.
Accordingly, dividends, royalty and interest payments between
Switzerland and the EU will not be subject to withholding tax,
provided various conditions such as minimum shareholding and
holding period are fulfilled.
In general, the bilateral agreements, including the Savings Tax
Agreement, will also apply to new EU member states joining the
EU after July 1, 2005 (e.g. Bulgaria, Romania). However, with
some countries transitional arrangements must be considered.
The application of the above-mentioned benefits from the Savings
Tax Agreement can be denied in cases of abuse or fraud.
This is because of the explicit reservation made in the Savings
Tax Agreement as to the use of domestic or agreement-based
provisions for the prevention of fraud or abuse, both by Switzerland
by the individual EU member states.
Double Tax Treaties between Switzerland and EU member states
with more favorable tax treatment of dividend, interest and royalty
payments remain unaffected.
10.5 Value added tax.
Although Switzerland is not an EU member state, its value added
tax (VAT) system was structured in accordance with the Sixth EU
VAT Directive («Sixth Council Directive on the harmonization of
the laws of the Member States relating to turnover taxes») as a
non-cumulative, multi-stage tax that provides for deduction of
input tax. As a result, Swiss VAT is levied as an indirect tax on
most goods and services at the federal level only and applies to
each stage of the production and distribution chain. It is designed
as a tax owed by the supplier of goods or services (i.e., the tax
liability is based on the payment by the recipient of the goods or
services).
10.5.1 Taxable persons
Any individual or legal entity, establishment, partnership or association
without legal capacity, institution, etc., that operates an
enterprise (obtains revenues through business or professional activity)
is liable for tax if its taxable turnover in Switzerland exceed
CHF 100,000 per year. All permanent domestic establishments of
a Swiss parent company form one taxable entity together with the
parent company. Permanent establishments of a foreign parent
company are considered a separate taxable entity.
If the revenues of a taxpayer (turnover from taxable supplies of
goods and services) are less than CHF 100,000 per year (or less
than CHF 150,000 for sports clubs and non-profit institutions),
then the entity is exempt from tax liability. However, any such
entity may also waive exemption from tax liability. Upon registration
with the Federal Tax Administration, the taxpayer is issued a
six-digit VAT registration number.
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97

10.5.2 Taxable supplies
VAT is levied on the following types of services: 1. delivery of
goods in Switzerland (including Liechtenstein); 2) supply of
services in Switzerland (including Liechtenstein); 3) purchase of
services (and certain goods deliveries in Switzerland) from enterprises
with their registered office in another country if the value of
goods or services exceeds CHF 10,000 per year; and 4) import of
goods.
Certain services provided to foreign recipients (as well as the
export of goods and the delivery of goods abroad) are not taxed
or are zero-rated with full input tax recovery. The delivery of
goods for the purposes of VAT is not limited to goods deliveries
as defined by Swiss commercial law. The VAT law provides for
a number of business transactions (such as the maintenance of
machinery, rental or lease of goods, trade in electricity, etc.) that
are deemed to be supplies of goods for VAT purposes.
10.5.3 Taxable amount
The basis for the calculation of the taxable amount for the supply
of goods and services is the agreed upon or the collected gross
remuneration (in cash or in kind). Input tax, i.e., the tax paid on
purchases of goods and services, can be deducted. Consequently,
only the value added is taxed (net all-phase principle).
10.5.4 Tax rates
The standard rate is 7.6 % (8 % from January 1, 2011) on every
taxable supply of goods or services. A reduced rate of 3.6 %
(3.8 % from January 1, 2011) is applicable to accommodations.
A reduced rate of 2.4 % (2.5 % from January 1, 2011) applies to
certain categories of goods and services for certain basic needs
such as water supply, food and non-alcoholic beverages, cattle,
poultry, fish, cereals and grain, books and newspapers, services
of non-commercial radio and TV broadcasters, etc.
The Federal Tax Administration offers further simplified VAT
accounting for small businesses with turnover of below CHF 5
million and a tax liability of CHF 100,000 or less per year. These
small businesses may opt to submit VAT based on a balanced
tax rate which is lower than the standard rate of 7.6 %, if they, in
return, waive the standard procedure for input VAT accounting,
which would otherwise be deducted from the VAT levied on turnover
(input VAT deduction). This simplified taxation method must
be maintained for at least one year, and VAT returns need to be
filed twice a year only – in contrast to the standard declarations
filed quarterly.
10.5.5 Exemptions
The law differentiates between VAT-exempt and VAT-excluded
turnover from VAT. No VAT is levied in either case, but a distinction
is made regarding the input VAT deduction.
In cases of exclusions, there is no input tax deduction possible
for the taxes paid in generating the turnover excluded from VAT.
Excluded activities are the healthcare sector, education, culture,
sport, social care, most banking and insurance activities, rental
and sale of real estate, as well as gambling and lotteries. For
most of these categories, however, the taxpayer may opt for
taxation voluntarily, except in the case of banking and insurance
turnover.
In contrast to activities excluded from VAT, exempt activities allow
for an input VAT deduction for all taxes paid in generating the
turnover in question (true exemption). An example of an activity
exempt from tax is the export of goods (see also section 10.5.7).
Business activities abroad are not subject to VAT. These types of
turnover are generally the result of international business models.
A typical example is a Swiss trading company that buys products
from a foreign manufacturing company and sells them to customers
in a third country, shipping the products directly to those
customers. Activities involving the supply of goods or services
abroad entitle the taxpayer to deduct input tax, provided the
turnover does not qualify as excluded turnover.
10.5.6 Deduction of input taxes
An enterprise registered for VAT is liable for VAT on all supplies
(output tax) and will incur VAT on purchases for the business
(input tax). In most cases, input taxes may be deducted from the
amount of output taxes due and so do not generally represent
an additional burden for a business. VAT is a genuine expense
only for the end-consumer or for a business involved in transactions
for which no input tax can be recovered (businesses with
excluded income such as banks and insurance companies).
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10.5.7 Exports
In addition to exported goods, certain services – if rendered to
a recipient domiciled abroad – are also VAT exempt (with credit).
However, the Swiss VAT law includes a list of services that are either
taxable where the service provider is domiciled or are subject
to special provisions according to the list (e.g., services in connection
with real estate, hotel and restaurant services; services in
relation to culture, sport and the arts; passenger transport; etc.).
Services not included in this list that are provided to a foreign
recipient are not subject to Swiss VAT (a catch-all provision – the
«place of supply is where the recipient is established» is applied).
10.5.9 Non-resident enterprises
Foreign businesses supplying goods or certain services to or
within Switzerland wishing to waive the exemption from tax liability
or with corresponding sales revenues in excess of the threshold
stated in Section 10.5.1 are generally required to appoint an authorized
VAT representative based in Switzerland. Such entrepreneurs
may claim input VAT directly. Non-resident entrepreneurs
without taxable activities in Switzerland are entitled to a refund of
Swiss VAT if their foreign activities would qualify as taxable turnover
under Swiss VAT law and if the country of residence grants
reciprocal treatment to Swiss entrepreneurs.
However, the VAT exempt nature of such services has to be
proven by the underlying documents such as invoices, agreements,
etc. Under all circumstances, it is very important that the
documentation be issued in compliance with the requirements
according to the Swiss VAT law. The same applies to export
shipments, where a customs export certificate is required for tax
exemption.
10.5.8 International business activity
The basic VAT rules described above have the following effect in
the case of a Swiss trading company that buys products from a
foreign manufacturing company and sells them to customers in
a third country, shipping the products directly to those customers:
Fig. 49: International business activity
DE * CH * IT
10.6 Other taxes.
10.6.1 Stamp taxes
Generally, the tax liability arises on special legal transactions such
as the issuance of shares (issuance stamp tax also known as
capital duty) or the trading of securities (securities transfer stamp
tax).
The tax on the issuance and the increase of equity of Swiss
corporations is 1 % on the fair market value of the amount contributed,
with an exemption on the first CHF 1 million of capital
paid in, whether it is made in an initial or subsequent contribution.
Issuance stamp tax is further levied in respect of some debt
instruments such as bonds and money market papers at a rate
of 0.06 % or 0.12 % on the nominal value of such instruments for
each year or part thereof till maturity of such instrument. Special
rules apply for instruments that run for less than a year.
Carrier
Invoice
Delivery of goods
* Foreign sales not subject to Swiss VAT
The transfer of Swiss and foreign securities in which a Swiss
securities dealer participates as a contracting party or as an
intermediary is subject to Swiss securities transfer stamp tax
(often called «securities turnover tax»). Depending on the issuer’s
residence (Switzerland or foreign country), the tax rate is 0.15 %
or 0.3 % and is calculated on the consideration of the securities
traded.
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99

Swiss securities dealers are defined as any persons professionally
engaged in buying or selling securities for their own account
or for another person, including Swiss banks and other Swiss
bank-like institutions. Furthermore, companies holding taxable
securities whose book values exceed CHF 10 million and remote
members of a Swiss stock exchange with regard to Swiss titles
which are quoted on the Swiss stock exchange are considered
Swiss securities dealers.
10.6.2 Real estate taxes
Capital gains on Swiss immovable property are either subject to
a special cantonal real estate gains tax or to ordinary corporate
income tax depending on the system that is applied in the canton
where the immovable property is located. The right to tax such
gains is reserved to the cantons and municipalities.
Furthermore, in most cantons the transfer of real estate is subject
to a conveyance tax, whereas on the federal level no taxes of
such kind are levied. As a general rule, conveyance tax is assessed
on the purchase price or the taxable value of the real
estate and is typically paid by the purchaser of the real estate.
Depending on the canton, the applicable tax rate varies between
1 % and 3 %.
10.7 Double taxation treaty
network.
To minimize the effect of double taxation in Switzerland and
abroad, Switzerland has concluded tax treaties covering direct income
taxes with all important industrial countries and many other
countries. Most of these treaties are patterned on the principles
of the OECD model convention, which defines where the income
or the assets are to be taxed and also describes the method
for the elimination of double taxation. Switzerland adopted the
tax exemption method, exempting income allocable to a foreign
country from taxation in Switzerland. Such income and net worth
is only considered for calculating the applicable tax rate (progression).
On certain income streams (dividend, interest and license
fees) both states, the state in which the income is earned and
the state of the recipient’s residence, are entitled to tax them.
However, the double tax treaty limits the right of taxation of the
source state, and the source tax can be credited against the tax
levied in the recipient’s state of residence. To date, more than 70
tax treaties are in effect, plus also the EU bilateral agreements
(since July 1, 2005). As Swiss tax treaties are treated as international
conventions, they generally supersede federal as well as
cantonal/municipal tax rules.
Moreover, about half of the cantons levy a special wealth tax on
real estate. This tax is due every year in addition to the general
wealth tax. The tax is levied at the place where the property is
situated and is assessed on the market or taxable value of the
real estate without allowing for deduction of debts. The tax rates
applied range between 0.03 % and 0.3 %.
Swiss double tax treaties apply to persons (individuals or companies)
who are resident in one or both of the contracting states.
As already mentioned in section 10.3.5, Swiss residents applying
for lump-sum taxation generally qualify for treaty relief as well.
However, some treaties provide for special conditions to be met
in order to benefit from the treaty applied.
Apart from the tax treaties covering direct income taxes, Switzerland
also concluded a few tax treaties in the area of inheritance
and estate tax. Switzerland has not negotiated any double tax
treaties concerning gift taxes so far. Furthermore, there are some
special treaties relating to cross-border commuters, taxation of
international air and transport, and the tax situation of international
organizations and their staff.
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10.8 Transfer pricing rules.
According to Swiss tax law, transactions between group companies
must be at arm’s length. Switzerland does not have separate
transfer pricing legislation and does not plan to enact such
legislation in the near future. Instead, the Swiss tax authorities
follow the transfer pricing guidelines of the OECD to determine
if a transaction between related parties is at arm’s length. In
Switzerland, no specific documentation requirements for transfer
pricing purposes must be observed. A company doing business
in Switzerland should however have the appropriate documentation
on file verifying the arm’s-length nature of transactions with
related parties.
Your contacts in Switzerland
Georges Meyer, Tax Partner
Leader US Desk
PricewaterhouseCoopers Ltd
Birchstrasse 160
CH-8050 Zurich
Direct Phone: +41 58 739 43 88
E-mail: US-Desk@ch.pwc.com
Samuel Bussmann, Tax Senior Manager
Senior Manager US Desk
PricewaterhouseCoopers Ltd
300 Madison Avenue
USA-NY 10017
Direct Phone: +1 646 471 5152
E-mail: US-Desk@ch.pwc.com
Federal Department of Finance FDF
www.efd.admin.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
101

11. Infrastructure.
Switzerland is closely integrated into the European transportation
infrastructure thanks to a dense network of road,
rail and air connections. Frequent and reliable connections
guarantee the smooth and efficient transport of passengers
and goods. The supply of energy, water, communications
services and postal services is guaranteed at all times. A
well-developed healthcare system ensures that the population
has access to medical care without having to travel long
distances.
Fig. 50: Quality of the infrastructure, 2008
1 = underdeveloped, 7 = comprehensive and efficient
1 Switzerland 6.8
2 Singapore 6.7
3 Hong Kong SAR 6.7
4 Austria 6.6
5 France 6.6
6 Germany 6.5
9 Denmark 6.3
12 Luxembourg 6.1
14 USA 5.9
15 Belgium 5.8
17 Japan 5.8
18 Netherlands 5.8
33 UK 5.2
65 Ireland 4.1
66 China 4.0
72 Italy 3.8
81 Brazil 3.4
86 Russia 3.3
89 India 3.2
Source: World Economic Forum, The Global Competitiveness Report 2009 – 2010
Federal Department of the Environment, Transport, Energy
and Communications (DETEC)
www.uvek.admin.ch
Languages: German, English, French, Italian
11.1 Transport.
The Swiss economy is supported by an excellent distribution infrastructure
for supplying goods and services. With 1.7 km of roads per
square kilometer, Switzerland is one of the continent’s most densely
developed countries for motorized transport. The Swiss government’s
transport policy is primarily aimed at improving the country’s
attractiveness as a business location and managing increasing
mobility in an environmentally compatible manner.
11.1.1 Road network
Switzerland’s highway network is one of the densest in the world.
There are currently 1,763.6 km (1,096 miles) of national highways
in operation, providing access to all parts of the country. When
finally completed, the network will total 1,892.5 km or 1,176 miles
(scheduled completion in 15 years). A remarkable feature is the
high proportion of tunnels. Today 220 tunnels are in operation
covering a total length of 200 km (about 125 miles). Every ninth
kilometer runs underground. At least three-quarters of the Swiss
highway system consists of four-lane divided superhighways.
The national highways are also major international transportation
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outes. The connection between Germany and Italy through the
Gotthard Tunnel is of critical importance in Europe.
In order to use Switzerland’s superhighways (Autobahn), every
domestic and foreign motor vehicle weighing up to 3.5 metric
tons must have a special highway sticker or «vignette» (currently
CHF 40). The sticker is valid for a calendar year and can be
purchased at customs and post offices, gas stations and railroad
stations. No special tunnel fees are charged for using the Gotthard
and San Bernardino transalpine tunnels.
Trucks are subject to a heavy vehicle fee (HVF) based on kilometers
driven in Switzerland, vehicle weight and emissions category
(Euro 0 – III). For the route from Basel to Chiasso, 40-ton trucks
can expect to pay a fee ranging from EUR 180 to EUR 220.
Vehicles over 3.5 metric tons are not allowed to travel on Swiss
roads or highways at night or on Sundays.
Federal Roads Office (FEDRO)
www.astra.admin.ch
Languages: German, English, French, Italian
Road traffic departments
www.asa.ch
Languages: German, French
Customs information on kilometer-based heavy vehicle fee
(HVF)
www.ezv.admin.ch
Link: Customs information for companies
Languages: German, English, French, Italian
11.1.2 Rail
Because of the punctuality and reliability of their public transportation
systems, the Swiss are the most frequent rail travelers in all of
Europe. Every day, 9,000 trains run on the 3,000-km (1,865-mile)
rail network operated by the SBB (Swiss Federal Railways). In addition
to the SBB, there are a number of private railroad companies
in Switzerland that operate on tracks covering somewhat more
than 2,000 km (almost 1,250 miles). In spite of the fact that this rail
network has the highest capacity utilization in Europe, the trains are
very punctual. Nineteen out of every twenty passenger trains arrive
at their destination within five minutes of the scheduled arrival time.
In order to protect the population and the environment, more and
more freight traffic will be moved from road to rail in the future.
Three major rail projects now underway will provide important
benefits to Switzerland and Europe over the medium and long
term. They will increase transport capacity, reduce passenger
and freight traffic on roads and highways, and help protect and
preserve the ecologically sensitive Alpine region.
• Rail 2000: New lines in Switzerland’s central region (Mittelland)
will allow long-distance trains to run every half hour. They
will optimize the connections between major centers and will
ensure much shorter travel times.
• AlpTransit or NRLA Project: The new Lötschberg and Gotthard
transalpine lines are designed to provide new, fast north-south
connections and facilitate substantial expansion of capacity
and services. Long-distance travel times have been reduced by
the Lötschberg base tunnel, which is 34 km (21 miles) long and
already in operation. You can now get to Milan from Berne in
less than 2 3/4 hours. As for freight transport, the new Lötschberg
base route helps meet a key goal of Swiss transport policy,
which is to transfer transalpine freight traffic from road to rail. It
permits a substantial increase in transport capacities, and the
larger tunnel cross-sections allow heavier freight trains to pass
through (shuttle profile). The AlpTransit or NRLA project («New Rail
Link through the Alps») is being built in stages. The Gotthard base
tunnel, which is expected to be opened in 2016, will be the
longest tunnel in the world at 57 km (over 35 miles).
• Link to the European high-speed rail network: Connection
to the European high-speed rail network (TGV and ICE) will
make Switzerland the most important hub in Europe’s future
high-speed network. The Swiss government will invest a total
of CHF 1,090 million (2003 prices) in the rail network by the
end of 2015 in order to provide better connections with the
European high-speed network. This will shorten travel times
from Switzerland to Paris, Lyon, Munich, Ulm and Stuttgart.
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SBB (Swiss Federal Railways)
www.sbb.ch
Languages: German, English, French, Italian
Zurich. But the two other international airports, Geneva and Euro-
Airport Basel, are also becoming increasingly important freight
support points, particularly for express and courier services.
The world’s leading express, package and courier services have
posted steady growth in volume.
Federal Office of Transport (FOT)
www.bav.admin.ch
Languages: German, English, French, Italian
The Berne, Lugano and St. Gallen-Altenrhein regional airports
also offer attractive scheduled flights to European destinations on
a daily basis. Sion and St. Moritz-Samedan have seasonal business
connections that are not only important for tourism but save
time for the entire service sector.
11.1.3 Air
Zurich Airport is one of the most important transportation hubs in
Europe. Passengers appreciate the excellent standard of service
at this airport. This is confirmed by its high ranking in the annual
Airport Service Quality (ASQ) Awards. Zurich is ranked in first
place ahead of Southampton (England UK) and Oporto (Portugal)
airports. From a global perspective, Zurich is in second place
behind Taipei and ahead of San Diego in the category of airports
with 15 to 25 million passengers. Around 22 million passengers
used the airport in 2008. The freight volume in the same period
totaled 387,671 metric tons. The airport currently serves 151 destinations
on four continents and 63 countries. Most of the flights
(77 %) connect Switzerland with Europe, while 23 % are intercontinental
flights. The intercontinental flights connect Zurich with
45 cities in 28 countries around the globe.
The two other international airports in Switzerland – Geneva and
Euro-Airport Basel – also have a large number of connections to
the key European business centers and a number of direct flights
to overseas destinations. Geneva handled 11.5 million passengers
and 48,894 metric tons of freight in 2008. The corresponding
figures for Basel were 4.2 million passengers and 38,786 metric
tons of freight.
Air travel
www.swissworld.org
Search under: Air travel
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
Federal Office of Civil Aviation (FOCA)
www.aviation.admin.ch
Languages: German, English, French, Italian
Zurich Airport
www.flughafen-zuerich.ch
Languages: German, English, French
Geneva Airport
The fact that the three international airports are located in border
areas only a short distance away from neighboring countries
facilitates international trade to and from the EU area through
Switzerland. Air freight is an important freight transport option for
exporting companies in these regions. The most important export
products include specialty chemical and pharmaceutical products,
high-tech products, automotive components and perishable goods.
Three-quarters of Swiss airfreight is processed at the cargo hub in
www.gva.ch
Languages: German, English, French
104 Handbook for Investors 2010

Fig. 51: Direct intercontinental air connections from Zurich (ZRH) and Geneva (GVA), 2009
on at least five days per week; in parentheses: airport: number of flights daily; flight duration
1 Montreal (ZRH: 1; 8:10h)
2 Toronto (ZRH: 2; 8:50h)
3 Chicago (ZRH: 1; 9:40h)
4 Philadelphia (ZRH: 1; 9:05h)
5 New York Newark
(GVA: 1; 8:45h; ZRH: 2; 9:05h)
6 New York JFK
18 Doha (GVA: 1; 6:10h;
(GVA: 1; 8:35h; ZRH: 3; 8:40h)
12 São Paulo (ZRH: 1; 12:00h)
ZRH: 1; 6:00h)
7 Boston (ZRH: 1; 8:15h)
13 Johannesburg (ZRH: 1; 10:25h)
19 Abu Dhabi (GVA: 1; 6:25h)
24 Bangkok (ZRH: 2; 11:00h)
8 Washington (ZRH: 1; 9:10h)
14 Dar es Salaam (ZRH: 1; 9:40h)
20 Dubai (ZRH: 3; 6:05h)
25 Singapore (ZRH: 3; 12:05h)
9 Atlanta (ZRH: 1; 10:25h)
15 Nairobi (ZRH: 1; 7:40h)
21 Muscat (ZRH: 1; 7:50h)
26 Hong Kong (ZRH: 1; 11:55h)
10 Miami (ZRH: 1; 10:25h)
16 Cairo (GVA: 1; 4:05h; ZRH: 1; 3:55h)
22 Delhi (ZRH: 1; 7:45h)
27 Shanghai (ZRH: 1; 11:30h)
11 Los Angeles (ZRH: 1; 12:30h)
17 Marrakesh (GVA: 1; 3:15h)
23 Mumbai (ZRH: 1; 8:15h)
28 Tokyo (ZRH: 1; 11:50h)
For international corporations, the ability to schedule business
flights at short notice on company-owned or pooled business jets
is becoming more and more critical. In addition to the national
airports, there are also regional airports throughout the country
set up to handle business aviation, and most of them are suitable
for smaller jets. The modern infrastructure of these airports is designed
for business travelers, offering either customs clearance or
allowing authorized cross-border travel by persons from the areas
covered by the Schengen Agreement (the Schengen Area).
Aerosuisse (Swiss aerospace umbrella organization)
www.aerosuisse.ch
Languages: German, French
Aircraft Owners and Pilots Association Switzerland
www.aopa.ch
Languages: German, French
Handbook for Investors 2010
105

Fig. 52: National and regional airports in Switzerland
by 2014. The effect on electricity pricing structures will increase
with progressive liberalization. The liberalization of the natural gas
market will take a little longer.
Swiss Federal Office of Energy (SFOE)
www.energie-schweiz.ch
Languages: German, English, French, Italian
Source: Federal Office for Civil Aviation (FOCA)
11.2 Energy.
Large-scale power consumer group (Gruppe Grosser
Stromkunden)
www.stromkunden.ch
Language: German
Switzerland has a reliable and secure nationwide energy supply
system. Petroleum products accounted for 45.2 % of gross
energy consumption in Switzerland in 2007. Nuclear power plants
supplied 25.2 % of the nation’s energy, and 11.5 % was produced
using hydropower. Natural gas also plays a relatively significant
role, supplying 9.7 % of the energy requirements in 2004.
Electricity accounted for 23.9 % of final consumption and was
generated for the most part in Switzerland (hydroelectric power
plants: 55 %, nuclear power plants: 40 %). Switzerland’s integration
into the interconnected European energy system ensures that
the entire country is supplied with electricity, even during periods
of particularly high power consumption. This also applies to the
other forms of energy, such as natural gas and petroleum. There
is an extensive network of gas stations that provide fuel for motor
vehicles: over 3,500 for gasoline and diesel fuel and more than
60 for natural gas and biogas. The price of gasoline is moderate
in comparison with neighboring countries (15 % lower than
in Germany and Italy, 23 % lower than in France, and 10 % lower
than in Austria).
The Swiss electric power market is highly fragmented. Approximately
900 electric utility companies supply the country with
electricity, including seven related utilities and about 80 producers.
The electric power market will be gradually opened up beginning
in 2009. Initially, large-scale consumers (requiring more than
100,000 kWh per year) will be able to select the supplier of their
choice. It is expected that all end-customers will have this option
11.3 Water.
Switzerland is a country rich in water resources. 6 % of Europe’s
fresh water supply is stored in the Swiss Alps. The Gotthard massif
in the center of the Swiss Alps is a continental divide. From
here the Rhine flows to the North Sea, the Rhone to the western
Mediterranean, the Ticino (Po) to the Adriatic Sea, and the Inn
(Danube) to the Black Sea.
Water, Federal Office for the Environment (FOEN)
www.bafu.admin.ch
Languages: German, English, French, Italian
11.3.1 Drinking water
The water that flows through all water pipes in Switzerland is so
fresh and pure that it meets the purity requirements for mineral
water but is a thousand times cheaper. Even the water from public
fountains can be drunk without hesitation. Only 2 % of annual
precipitation is utilized for the drinking water supply. The Swiss
population uses about 400 liters of water per capita per day in
households, industry and commercial operations. Household
consumption accounts for 160 liters of that amount on average.
Drinking water from water pipes costs on average about
106 Handbook for Investors 2010

CHF 1.60 per thousand liters in Switzerland. At a daily cost of
CHF 0.26 per person, the cost is just under CHF 0.80 per day for
a three-person household. Ground water from wells and springs
accounts for 80 % of consumption, and the rest comes primarily
from lakes.
Drinking water
31 out of every 100 Swiss residents access the Internet through
broadband connections (as of December 2007). Switzerland
therefore ranks above average for OECD countries and is among
the leading countries in this regard. The expansion of the «Fiber
to the Home» (FTTH) communication network, which is being
connected to every business establishment and multi-family or
single-family residence by fiber-optic cable, is currently underway
throughout Switzerland.
www.trinkwasser.ch
Languages: German, French, Italian
11.3.2 Waste water disposal and water pollution control
Switzerland’s role as the «moated castle of Europe» means that
Switzerland is obligated to make special efforts in the area of
water pollution control. Purification of waste water is a necessary
requirement for maintaining and preserving water ecosystems
over the long term. Thanks to modern waste water purification
technology, there is no health risk associated with swimming
in Switzerland’s many lakes and rivers. The waste water from
households, industry, business and agriculture is piped to purification
systems through sewage pipes totaling 40,000 km to
50,000 km in length (about 25,000 to 31,000 miles). Today 97 %
of all Swiss households are connected to one of the country’s
900 waste water treatment plants.
11.4 Communication.
The social and economic significance of information and communication
technologies (ICT) is growing rapidly. In Switzerland
approximately 77 % of households are equipped with computers.
The high degree of dissemination of information and communication
technologies in Swiss households is a good foundation for
further development of private e-commerce.
Fig. 53: Internet subscribers, 2007
Subscribers to high-speed Internet connections per
100 inhabitants
Denmark 35.1
Netherlands 34.8
Norway 31.2
Switzerland 31.0
Finland 30.7
Korea 30.5
Sweden 30.3
Canada 26.6
UK 25.8
Belgium 25.7
France 24.6
Germany 23.8
United States 23.3
Japan 22.1
OECD 20.0
Austria 19.6
Ireland 18.1
Spain 18.0
Italy 17.2
Portugal 14.4
Source: OECD
Federal Office of Communications (OFCOM)
DSL
Cable modem
Fiber-optic cable/LAN
Other high-speed
connections
In 2006 Switzerland recorded the highest ICT expenditure – EUR
2,763 per inhabitant – followed by Sweden, Denmark and Japan.
Information technologies accounted for 56 % of total ICT expenditure
in Switzerland, while communication technologies accounted
for 44 %. In 2006 ICT expenditure totaled about 6.64 % of the
gross domestic product (GDP). This puts Switzerland in third
place behind Japan and Sweden.
www.bakom.ch
Languages: German, English, French, Italian
Handbook for Investors 2010
107

Information society – indicators
www.bfs.admin.ch
Languages: German, French
With more than 2,500 post office branches, the post office
network is very dense. In an international comparison with seven
other European countries, Switzerland has the highest density of
post office branches per area and the smallest average distance
to the nearest post office branch. In addition, Swiss Post offers
total logistics solutions ranging from procurement through warehousing
to information logistics, including cross-border service.
Registry for Internet domain names (.ch and .li)
www.nic.ch
Languages: German, English, French, Italian
Swiss Post
www.post.ch
Languages: German, English, French, Italian
11.5 Postal services.
Swiss Post serves the entire country (universal nationwide
service). It is a byword for reliability, breaking European records
again and again.
In recent years, the postal market has undergone fundamental
changes. In addition to the government postal system, numerous
private companies are now offering postal delivery services in
certain areas in which competition is allowed. The package delivery
market (for packages over 1 kg) has been liberalized since
2004. Letters weighing more than 100 g can now be handled
by private postal services, provided that they have the required
license. This change occurred in April 2006. Swiss Post has maintained
its monopoly only over delivery of domestic letters and
letters from abroad weighing 100 g or less. On July 1, 2009, the
letter monopoly limit will be lowered to 50 g. Further liberalization
is planned.
11.6 Healthcare.
11.6.1 Medical care
Highly trained medical professionals, famous hospitals and top
medical institutions help make the Swiss healthcare system
among the best in the world. Approximately 11.5 % of gross
domestic product is spent on healthcare. A dense network of
hospitals, medical and dental practices, and pharmacies ensures
universal access to out patient and in patient care. For every
100,000 inhabitants, there are 130 general hospitals, 191 specialized
hospitals and clinics, 205 physicians in private practice, 52
dentists and 22 pharmacies. Emergency medical care by ambulance
or helicopter (Rega) is well developed and functions professionally.
The Spitex organization provides residential medical care
in one’s own home.
108 Handbook for Investors 2010

Fig. 54: Healthcare infrastructure, 2008
1 = Does not meet society’s needs,
10 = Meets society’s needs
1 Switzerland 8.91
3 Belgium 8.74
4 Singapore 8.63
5 Germany 8.06
6 Luxembourg 7.97
7 France 7.79
8 Denmark 7.53
10 Netherlands 7.29
14 Hong Kong SAR 6.98
21 Japan 6.42
23 Italy 5.81
28 UK 4.92
29 USA 4.85
32 People’s Republic of China 4.57
40 India 3.31
41 Ireland 3.18
49 Brazil 2.21
53 Russia 1.86
Source: IMD World Competitiveness Yearbook 2009
Federal Office of Public Health (FOPH)
www.bag.admin.ch
Languages: German, English, French, Italian
Swiss Medical Association (FMH)
www.fmh.ch
Languages: German, French, Italian
Registry of Swiss physicians
www.medindex.ch
Languages: German, French, Italian
Spitex Federation of Switzerland
www.spitexch.ch
Languages: German, French
11.6.2 Health insurance
The basic health insurance that all persons residing in Switzerland
are required to carry guarantees access to good medical care. It
covers medical treatment in the event of illness and in the event
of accidents if treatment is not covered by accident insurance
(even in foreign countries in some cases). Nonetheless, health
insurance is not government insurance but is offered by 94 private
insurers (health insurance funds). Supplemental insurance is
optional.
Swiss Red Cross
For further information see section 13.5.
www.redcross.ch
Languages: German, English, French, Italian
Overview of health insurers
Swiss hospitals
www.bag.admin.ch
Languages: German, French, Italian
www.hplus.ch
Languages: German, French, Italian
Handbook for Investors 2010
109

12. Education and research.
For a country lacking in natural resources such as Switzerland,
a well-educated work force and constant innovation are its
most important capital. The Swiss education and research
policy is designed accordingly. Public schools, universities,
postgraduate studies and international private schools and
boarding schools are known worldwide for their quality. The
federal structure of the country also ensures proximity of
the business world and research institutions to the education
system, as well as high quality. One special feature of Swiss
education is the dual training system: students have a choice
between the traditional educational path at high schools and
universities, or trade and industrial vocations and careers in
the service sector, where they receive hands-on training on
the job.
Swiss Conference of Cantonal Ministers of Education
(EDK)
www.edk.ch
Languages: German, English, French, Italian
The Swiss Education Server
www.educa.ch
Languages: German, English, French, Italian
12.1 Schooling and vocational
training.
Under the Swiss system, the cantons are responsible for the quality
and type of education (basic education, universities, universities
of applied sciences) within their territory. Only the Swiss Federal
Institutes of Technology are under federal direction. Various coordination
bodies ensure that the education and instruction plans are
harmonized among the cantons.
Educational statistics
www.bildungssystem.bfs.admin.ch
Languages: German, French
110 Handbook for Investors 2010

Fig. 55: Switzerland’s educational system
Source: EDK, October 2008
Handbook for Investors 2010
111

12.1.1 Basic and further education
Education begins at the kindergarten level at age five or six.
Primary school starts at age seven and runs through to grades
four to six, followed by the lower secondary level, the name and
curriculum of which vary from canton to canton. Students attend
a secondary school which corresponds to their personal level.
With the completion of the lower secondary level, students have
finished the nine compulsory school years. Students can then either
begin vocational training, attend high school to prepare them
for university studies or earn a specialized diploma.
95 % of students finish their mandatory education at the public
school where they reside; only 5 % attend private schools.
Public schools enjoy a good reputation. In the OECD Program for
International Student Assessments (PISA), Swiss students scored
higher than the average in OECD states, with the public schools
achieving higher scores than the private schools.
The public schools not only provide an education, they also fulfill
an important integration function: children with different social,
linguistic and cultural backgrounds all attend the same schools.
For Switzerland, a country with four national languages, multilingual
skills are extremely important.
Fig. 56: Quality of the educational system (2009)
1 = Does not meet the economy’s needs,
10 = Meets the economy’s needs
1 Finland 8.53
2 Singapore 8.20
3 Switzerland 8.07
4 Denmark 7.45
5 Canada 7.38
7 Netherlands 6.87
8 Ireland 6.85
11 Belgium 6.60
13 Germany 6.13
14 India 6.07
17 France 5.87
18 Hong Kong SAR 5.83
21 Japan 5.45
22 Luxembourg 5.38
25 UK 5.14
28 US 4.81
35 Italy 4.23
40 Russia 4.00
43 People’s Republic of China 3.80
53 Brazil 2.82
Source: 2009 IMD World Competitiveness Yearbook
In addition to their mother tongue, children are taught a second
national language and English beginning in primary school.
Fig. 57: Public spending on education per capita in USD (2007)
1 Luxembourg 5,153
2 Norway 4,494
3 Denmark 4,224
4 Switzerland 3,066
5 USA 2,839
6 Ireland 2,650
8 France 2,473
9 UK* 2,453
10 Netherlands 2,394
11 Belgium** 2,151
15 Germany 1,606
16 Italy* 1,435
18 Japan* 1,325
21 Singapore 1,090
22 Hong Kong SAR 996
32 Russia 369
34 Brazil 319
43 People’s Republic of China 71
45 India 29
*2006 **2005
Source: 2009 IMD World Competitiveness Yearbook
112 Handbook for Investors 2010

PISA study
Federal Office for Professional Education and Technology
www.pisa.oecd.org
Languages: German, English, French
www.bbt.admin.ch
Languages: German, English, French, Italian
12.1.2 Vocational training
Basic vocational training begins after the completion of compulsory
education. Great importance is placed on practical on-thejob
training. Three-quarters of all young people complete an
apprenticeship, which lasts three to four years and consists of
practical work in a company and theoretical studies at a vocational
school. In addition, students are eligible to obtain professional
certification, which entitles them to enter a university of
applied sciences where they can earn a Bachelor’s or, in some
cases, a Master’s degree. Universities of applied sciences provide
a tertiary level of education. 90 % of Swiss students continue
their education once they have completed compulsory schooling,
placing Switzerland at the top of all OECD countries with regard
to further education.
Federal Department of Economic Affairs
www.evd.admin.ch
Link: Themen/Bildung, Forschung, Innovation
Languages: German, French, Italian
Swiss education system
www.swissworld.org
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
This dual system ensures that businesses have a choice of wellqualified
and practically trained employees in a given industry.
The rate of unemployment among young people is approximately
half as high as in Germany, Sweden and the United States. It is
important to note that vocational training as a foundation of the
Swiss school system does not reduce the importance of scientific
subjects in education. By international standards, Switzerland
ranks third in Europe.
Professional education and training play an important role in
Switzerland. Higher specialist and professional training courses are
conducted with the approval of the federal authorities and professional
associations. Successful completion of these courses leads
to a Swiss federal vocational certificate or diploma. In Switzerland
there are over 100 federally recognized schools offering professional
college degree programs, the majority of which are engineering
colleges. These schools teach qualifications that often are
learned only at universities in other countries. Vocational degrees
are mutually recognized through bilateral agreements between
Switzerland and the European Union.
Portal for scholastic and professional advice
www.berufsberatung.ch
Languages: German, French, Italian
12.2 Further education.
Continuing education plays an important role in Switzerland. Public
institutions such as universities or universities of applied sciences
offer post-graduate programs and courses on various specialized
topics which are open to everyone, not just graduates.
Non-students can also sign up to sit in on regular courses. Adult
education courses are publicly subsidized and open to everyone.
There is also a wide variety of courses offered by private schools –
from language courses to yoga to management courses.
Handbook for Investors 2010
113

Overview of schools and courses
www.weiterbildung.ch
www.seminare.ch
Language: German
Verband Schweizerischer Volkshochschulen
www.up-vhs.ch
Languages: German, French
12.3 Universities and colleges.
12.3.1 Universities and technical colleges
Fig. 58: Swiss higher education landscape
In Switzerland there are ten cantonal universities at which the
language of instruction is either German (Basel, Berne, Zurich,
Lucerne, St. Gallen), French (Geneva, Lausanne, Neuchâtel), Italian
(Lugano) or German and French (Fribourg). There is a Swiss Federal
Institute of Technology in Lausanne (French) and one in Zurich
(German). In 2008, some 117,000 students were enrolled in these
twelve universities, 50 % of whom were female. About 24 % were
foreign students, which is one of the highest percentages of international
students worldwide. At 45 %, the number of foreign professors
is also very high, underscoring the international aspect of Swiss
universities.
There is a very wide range of subjects of study offered at Swiss
universities. With the exception of medicine, there are no specific
restrictions on admission. For a Bachelor’s/Master’s degree,
foreign students must fulfill the language requirements, and
some universities require students to pass an admissions exam.
Tuition fees for international students are also very reasonable.
In addition to tuition, between CHF 18,000 and 28,000 a year is
required for living expenses, depending on the city and personal
needs. As part of the Bologna Accords, all courses of study have
been switched over to the Bachelor’s/Master’s system. Switzerland
participates in international student exchange programs such as
Erasmus, making it possible for foreign students to study at a
Swiss university for a semester.
Source: SER State Secretariat for Education and Research
Swiss universities have earned high praise worldwide for their
curricula and fields of research in certain areas of specialization
in various degree subjects. The two federal institutes of technology
in Zurich (ETHZ) and Lausanne (EPFL) work together with
the international research community to conduct cutting-edge
research. They strive to attract world-renowned scientists. Swiss
universities regularly rank among the top 100 universities worldwide
and even higher in Europe. Swiss colleges and universities
are also involved in international research programs – particularly
the EU Framework Program for Research and Technological
Development – and offer postgraduate studies (e.g. in cooperation
with foreign academic institutions).
114 Handbook for Investors 2010

Fig. 59: Tuition fees in CHF per year (2008/09)
Federal
Institute
of Technology
Lausanne
Federal
Institute
of Technology
Zurich
University
of
Basel
University
of
Berne
University
of
Fribourg
University
of
Geneva
University
of
Lausanne
University
of
Lucerne
University
of
Neuchâtel
University
of
St. Gallen
University
of
Zurich
University
of
Lugano
(Lugano,
Mendrisio)
Swiss students 1,266 1,288 1,400 1,310 1,224 1,000 1,160 1,570 1,030 2,040 1,378 4,000
Additional fees for
international students
– – – – 300 – – – 550 300 200 4,000
Total international
students
1,266 1,288 1,400 1,310 1,524 1,000 1,160 1,570 1,580 2,340 1,578 8,000
Source: CRUS Rectors’ Conference of the Swiss Universities
Overview of universities
Information for foreign students
www.ch.ch
Search under: university
Languages: German, English, French, Italian
www.swissuniversity.ch
Language: English
State Secretariat for Education and Research
www.sbf.admin.ch
Languages: German, English, French, Italian
Study in Switzerland
www.crus.ch
Languages: German, French
University rankings
www.universityrankings.ch
Languages: German, English, French
12.3.2 Universities of applied sciences
Universities of applied sciences offer practical training at the
Bachelor’s and Master’s level for professionals, most of whom
have professional certification and have already gathered experience
in their trade. In addition to normal teaching, these universities
conduct research and development projects with private
companies, in particular smaller and medium-sized companies,
and provide advanced training courses to local enterprises.
Swiss University Continuing Education Association
www.swissuni.ch
Languages: German, English, French, Italian
As a result, universities of applied sciences have partial responsibility
for regional science and technology transfer and therefore
are in continuous interaction with the industry. They have a large
pool of teaching, research, development and services competence
which is strongly geared to clients, markets and practice. In
their role as research institutes, they are supported at the national
level by the CTI Innovation Promotion Agency and by the Swiss
Federal Institutes of Technology and universities.
Handbook for Investors 2010
115

Overview of universities of applied sciences
MBA/EMBA programs in Switzerland
www.ch.ch
Search under: Universities of applied sciences
Languages: German, English, French, Italian
www.find-mba.com/switzerland
Language: English
Federal Office for Professional Education and Technology
www.bbt.admin.ch
Search under: Universities of applied sciences
Languages: German, English, French, Italian
Swiss education portal
www.ausbildung-weiterbildung.ch
Language: German
12.3.3 Executive MBA program (EMBA)
A special type of further education is the Executive MBA program,
which is aimed at managers with many years of experience under
their belt. Generally, EMBA courses are work-study programs that
are based on a module system. Most of the degree programs
also include time studying abroad in addition to the courses in
Switzerland. IMD in Lausanne is a prime example of a top Swiss
school whose EMBA program is regularly ranked as one of the
best in the world. The program at the University of St. Gallen is
also in the top 50 in the world.
Programs at Swiss universities
www.swissuniversity.ch
Languages: English
Economist rankings
mba.eiu.com
Language: English
Fig. 60: Executive MBA: the top schools
School Location Homepage
IMD
Lausanne (Switzerland),
Europe (Ireland, Romania),
Shanghai (China),
Silicon Valley (USA)
www.imd.ch/programs/
emba
English
Omnium Alliance
(University of St. Gallen,
University of Toronto,
partner schools)
University of St. Gallen
University of Zurich
Rochester-Berne/
University of Berne,
University of Rochester
GSBA Zurich, University
of Maryland
ZfU International
Business School
Brazil, India, Switzerland,
Hungary, China, North
America
St. Gallen (Switzerland),
Hungary, China, Brazil
Zurich (Switzerland), US,
China, India
Thun (Berne, Switzerland),
Rochester (US),
Shanghai (China)
North America, Europe
and Asia
Zurich, Boston (USA)
www.omniumgemba.
com,
www.gemba.unisg.ch
English
www.emba.unisg.ch
German
www.emba.uzh.ch
German
www.executive-mba.ch
English
www.gsba.ch/mba
German, English
www.zfu.ch/weiterbildung/masters
German
Financial Times rankings
www.rankings.ft.com
Search under: business school
Language: English
12.4 International private schools
and boarding schools.
The Swiss education system also includes private schools. There
are more than 260 private schools that teach courses in one of
the three national languages of German, French and Italian or
in English (and some also offer other languages) to more than
100,000 students.
116 Handbook for Investors 2010

Fig. 61: School fees for international private schools
Primary schools
Secondary schools
in USD English 1) French German English 1) French German
Ljubljana 10,323 5,594 n.a. 10,537 6,625 n.a.
Dublin 11,917 4,696 5,962 12,205 5,594 5,212
Barcelona 12,008 4,717 4,770 14,879 5,066 4,888
Singapore 13,532 9,915 10,973 15,898 11,068 10,973
Budapest 15,763 5,988 4,785 17,040 7,086 4,785
Milan 16,747 4,598 6,360 18,842 5,814 6,360
Geneva 18,137 10,801 10,572 19,388 13,913 9,885
Vienna 18,302 5,145 12,366 2) 21,933 5,145 12,366 2)
Frankfurt 20,224 4,461 5,300 2) 22,525 5,447 5,300 2)
Amsterdam 20,587 6,129 8,833 23,543 10,445 8,833
Paris 25,906 5,808 8,540 29,176 5,808 8,540
New York 27,000 16,310 14,100 27,600 18,590 15,100
London 30,204 5,229 8,342 32,452 6,371 8,342
Brussels 31,137 4,969 9,378 35,603 6,024 9,378
1)
average international, US and UK school fees
2)
local private school
Source: Mercer, Cost-of-Living Report, March 2008, www.mercer.com
International schools are primarily for the children of employees on
an international assignment who are generally only temporarily in
Switzerland. These children of expatriates receive a suitable international
education or instruction in their native language and are
prepared for the final exams that are valid in their home country.
All areas of Switzerland and all major cities have suitable learning
institutions, and school costs are in the middle range when compared
internationally.
Swiss boarding schools are not only known for their high level
of education, but also for their strict discipline and international
student body. Often they have very selective acceptance criteria
and are known for their elite standing around the world.
Swiss Federation of Private Schools
www.swiss-schools.ch
Languages: German, English, French, Italian, Spanish
Swiss Group of International Schools
www.sgischools.com
Language: English
Swiss private school register
www.swissprivateschoolregister.com
Languages: German, English, French, Italian
12.5 Research and development.
12.5.1 Swiss research industry
The faster the pace of technological change, the greater the role
that research and development play in the economy of a country.
Switzerland is a country with intensive research activities. It
spends almost 3 % of its GDP on research and development. All
relevant indicators position Switzerland in the top ranks of international
comparisons.
Handbook for Investors 2010
117

Of the total CHF 13.1 billion spent on research and development
in 2004, 70 % was financed by the private sector. The pharmaceutical
industry had the highest expenditure at CHF 3.6 billion.
The combined R&D expenses of all universities and research institutes
amounted to CHF 3 billion in 2004. Some 52,000 people are
involved in research, and 33,000 of these are in private industry.
Fig. 62: Total per capita expenditure on research and
development in USD (2006)
1 Sweden 1,609
2 Switzerland** 1,426
3 Finland 1,373
4 Luxembourg 1,358
5 Denmark 1,237
6 Japan 1,161
7 US 1,135
11 Germany 896
12 France 774
14 Singapore 716
15 UK 705
16 Belgium 692
17 Ireland 684
18 Netherlands 684
22 Italy 333
27 Hong Kong SAR* 206
33 Russia 74
40 Brazil* 40
43 People’s Republic of China 29
51 India** 4
Data from * 2005 ** 2004
Source: 2009 IMD World Competitiveness Yearbook
Fig. 63: Nobel prizes per million inhabitants (2007)
1 Switzerland 1.59
2 Norway 1.27
3 Sweden 0.98
4 UK 0.87
5 US 0.81
6 Denmark 0.73
8 Netherlands 0.43
9 Germany 0.37
13 Belgium 0.28
14 France 0.27
15 Ireland 0.23
19 Italy 0.08
20 Japan 0.07
21 Russia 0.06
24 People’s Republic of China 0.00
25 India 0.00
26 Luxembourg 0.00
26 Singapore 0.00
26 Hong Kong SAR 0.00
26 Brazil 0.00
Source: 2009 IMD World Competitiveness Yearbook
Government funding is provided principally for basic research.
The private sector and the scientific community work closely
together. Each institute at the university and college level has a
coordination office for cooperation with the private sector. The
CTI Innovation Promotion Agency can make significant financial
contributions to research and development projects in which
companies cooperate with non-profit research organizations.
Fig. 64: Research institutions in Switzerland
Institution Location Homepage
CERN European Organization for Nuclear Research Geneva www.cern.ch
English, French
EAWAG Swiss Federal Institute of Aquatic
Science and Technology
Dübendorf (Zurich),
Kastanienbaum (Lucerne)
www.eawag.ch
German, English
EMPA Materials Science and Technology Research Institution Thun (Berne), Dübendorf
(Zurich), St. Gallen
www.empa.ch
German, English, French
PSI Paul Scherrer Institute Villigen (Aargau) www.psi.ch
German, English
118 Handbook for Investors 2010

Institution Location Homepage
SLF WSL Institute for Snow and Avalanche Research Davos (Grisons) www.slf.ch
German, English, French,
Italian
The Graduate The Graduate Institute of International and Development Geneva
www.graduateinstitute.ch
Institute Studies
English, French
WSL Swiss Federal Institute for Forest, Snow and Landscape
Research
Birmensdorf (Zurich),
Bellinzona (Ticino)
www.wsl.ch
German, English, French
Source: Swiss National Fund, www.snf.ch
State Secretariat for Education and Research
www.sbf.admin.ch
Languages: German, English, French, Italian
CTI Innovation Promotion Agency
12.5.2 International research and development cooperation
The Swiss private sector has a keen interest in research cooperation
with partners abroad, particularly from the EU. Research and
development cooperation with innovative foreign partners also
allows smaller companies access to know-how from which they
can benefit. The bilateral agreements with the EU create even
more favorable conditions for this type of cooperation and allow
Switzerland to participate fully in all programs and activities of the
EU’s Framework Research Programs.
www.kti-cti.ch
Languages: German, English, French, Italian
International research and development cooperation
Swiss National Fund
www.snf.ch
Languages: German, English, French
www.snf.ch
Languages: German, English, French
Swiss international cooperation in education, research and
technology
Promotion of science
www.ch.ch
Languages: German, English, French, Italian
www.sbf.admin.ch
Link: Topics/International cooperation
Languages: German, English, French, Italian
The Swiss Portal for Research and Innovation
www.myscience.ch
Languages: German, English, French
Handbook for Investors 2010
119

13. Living in Switzerland.
Thanks to the excellent quality of life and the safe environment,
life expectancy in Switzerland is among the highest in
the world. The undamaged natural surroundings and varied
cultural and recreational opportunities attract not only many
tourists but also well-qualified foreign employees. Swiss
households have an average monthly earned income of
CHF 6,298, of which about 70 % remains as disposable income
for consumption after deduction of social security contributions
and taxes. Switzerland therefore has the highest
purchasing power in the world, despite relatively high prices.
13.1 Safety and quality of life.
Switzerland is a very safe country and offers an extremely high
quality of life. Switzerland receives high marks, in both cities and
rural regions, for important criteria such as income, healthcare,
climate and geography, political stability, safety and security,
individual freedoms, and family and community life.
Fig. 65: Global comparison of quality of living, 2009
New York, USA = 100
1 Vienna, Austria 108.6
2 Zurich, Switzerland 108.0
3 Geneva, Switzerland 107.9
4 Vancouver, Canada 107.4
4 Auckland, New Zealand 107.4
6 Düsseldorf, Germany 107.2
7 Munich, Germany 107.0
8 Frankfurt, Germany 106.8
9 Berne, Switzerland 106.5
10 Sydney, Australia 106.3
11 Copenhagen, Denmark 106.2
13 Amsterdam, Netherlands 105.7
14 Brussels, Belgium 105.4
16 Berlin, Germany 105.0
19 Luxembourg, Luxembourg 104.6
25 Dublin, Ireland 103.6
26 Singapore, Singapore 103.5
35 Tokyo, Japan 102.2
38 London, UK 101.6
49 New York, USA 100.0
Source: Mercer Survey, Quality of Living Global City Rankings
Everyone is guaranteed freedom of movement and safety –
everywhere and at all times. There are relatively few large population
centers or extensive monotonous and impersonal housing
developments. Children generally walk to school unaccompanied.
The safe environment and the traditional discretion of the Swiss
people are widely valued. Even internationally known celebrities
can often move about in Switzerland without personal protection.
120 Handbook for Investors 2010

Fig. 66: Personal safety, 2008
New York, USA = 100
1 Luxembourg, Luxembourg 131.4
2 Berne, Switzerland 126.3
2 Geneva, Switzerland 126.3
2 Helsinki, Finland 126.3
2 Zurich, Switzerland 126.3
6 Vienna, Austria 121.1
7 Oslo, Norway 120.8
7 Stockholm, Sweden 120.8
9 Singapore, Singapore 120.2
10 Auckland, New Zealand 119.4
10 Wellington, New Zealand 119.4
12 Copenhagen, Denmark 117.2
12 Düsseldorf, Germany 117.2
12 Frankfurt, Germany 117.2
12 Munich, Germany 117.2
12 Nuremberg, Germany 117.2
17 Dublin, Ireland 117.0
22 Amsterdam, Netherlands 115.8
28 Brussels, Belgium 114.3
35 Tokyo, Japan 111.5
40 Berlin, Germany 111.4
43 Hong Kong, China 109.9
Source: Mercer Survey, Quality of Living Global City Rankings
Fig. 67: Attractiveness for highly qualified employees from foreign
countries, 2009
1 = not attractive, 10 = very attractive
1 Switzerland 8.77
2 Singapore 8.22
3 US 7.80
4 Australia 7.63
5 Canada 7.46
7 Hong Kong SAR 7.42
8 UK 7.30
9 Ireland 7.00
10 Luxembourg 6.96
12 Russia 6.10
13 China 6.05
15 Netherlands 5.98
22 Belgium 5.43
23 India 5.34
25 France 5.22
26 Brazil 5.15
29 Germany 5.07
33 Denmark 4.72
44 Japan 4.07
54 Italy 3.00
Source: IMD World Competitiveness Yearbook 2009
13.2 Relocation and integration.
There are currently more than 6,500 foreign enterprises operating
in and from Switzerland. Almost 90 % of them would decide again
in favor of Switzerland if they had to make a new location decision.
Many of them often send foreign managers and specialists to
Switzerland for short-term temporary stays to work as expatriates.
There are specialized relocation agencies, expat groups, books
and websites designed to help these transferred employees orient
themselves quickly to life in Switzerland.
Swiss information platform
www.swissinfo.org
Languages: German, English, French, Italian, Portuguese,
Russian, Chinese, Japanese
Expatriates in Switzerland
www.expatexchange.com
www.xpatxchange.ch
www.glocals.com
www.englishforum.ch
Language: English
www.justlanded.com/schweiz
Languages: German, English, Italian
Handbook for Investors 2010
121

13.2.1 Relocation
A move to a foreign country raises many questions depending on
one’s individual situation. Which school is the most appropriate?
Where can you shop? How do we find a house? How high are the
taxes, duties and other fees? There are competent, internationally
experienced consultants in all parts of the country who can give
further assistance with these issues. Specialized relocation agencies
offer comprehensive packages that cover relocation issues
and the initial orientation period in Switzerland. The Internet offers
a wealth of information. A number of the cantonal economic development
agencies also have their own online information platforms
that cater specifically to expatriates.
Household items, personal collections, animals or a car can be
imported into Switzerland duty-free. The only requirement is that
the imported objects must have been used by you personally for at
least six months and will continue to be used by you after import.
Upon entering the country, you must present assurance that a residence
permit will be granted (or an employment contract, tenancy
agreement or deregistration certificate from the previous country
of residence for citizens of EU-17 or EFTA countries) as well as a
completed application form.
After entering Switzerland, you are required to register within the
first eight days in the municipality in which you will reside. The
following documents are required:
• Valid official identity document such as passport or identity
card (for each family member entering the country)
• Confirmation of health insurance (proof of mandatory basic
coverage). The period for registering with a Swiss health insurance
fund is three months, so confirmation of health insurance
can also be submitted later
• One passport photo (for each family member entering the
country)
• Personal documents (e.g. extract from register of births and
marriages, marriage certificate, birth certificates for minor
children, etc.)
• Employment contract
If a vehicle is being brought into Switzerland, it must be insured
and licensed in Switzerland within twelve months. A Swiss driver’s
license is also required within the same time period.
Customs information about relocation
www.ezv.admin.ch
Link: Information for private individuals > Important note >
Moving house …
Languages: German, English, French, Italian
Tips and price comparisons
www.comparis.ch/immigration
Languages: German, English, French, Italian
13.2.2 Language courses
Many Swiss citizens understand English and/or a second national
language of Switzerland. In order to become integrated into Swiss
society, however, knowledge of the national language spoken in
the particular region is a great advantage. Depending on the area,
the language may be German (spoken by 63.7 % of the Swiss
population), French (20.4 %), Italian (6.5 %) or Romansh (0.5 %).
The fact that there are four national languages in Switzerland
does not mean, however, that all Swiss people can speak four
languages.
There are large numbers of private companies and individuals offering
language courses tailored to every need. Public institutions
also offer language courses in the respective national language
in conjunction with immigrant integration efforts. Consulting the
Yellow Pages or the website of the Swiss Federation for Adult
Learning is recommended.
Languages in Switzerland
www.swissworld.org
Languages: German, English, French, Italian, Spanish,
Russian, Chinese, Japanese
122 Handbook for Investors 2010

Yellow Pages
yellow.local.ch
Languages: German, English, French, Italian
Tenants receive monthly bills from the utility company for the
electricity consumed in the property itself. Since there are various
providers of telephone and Internet connections (and often cable
television as well), tenants enter into separate agreements for
these services and pay providers directly.
Swiss Federation for Adult Learning
www.alice.ch
Languages: German, French, Italian
13.3 Renting a property.
Anyone interested in renting a property should contact the
advertiser (often a professional property management company)
and set up an appointment to see the property. If it meets your
expectations, you are generally asked to fill out an application
form. This form includes information such as age, marital status,
profession or occupation, children, residence status, employer,
salary and pets. Applicants are often required to provide an
excerpt from the debt enforcement register as proof that they can
pay the rent. This document can be obtained from the local debt
enforcement office.
13.3.1 Security deposit and lease agreement
Tenants must often pay a certain amount in advance as a security
deposit. It may total as much as three months’ rent and is deposited
in a special bank account in the tenant’s name. The deposit
serves as security for the landlord. After moving out, the tenant
will receive the deposit back, with interest.
The tenant has the right to move into a clean and functional
property. The formal handover takes place before the new tenant
moves in. The tenant and landlord inspect the condition of the
property together and record any defects in writing.
If landlords wish to increase the rent (after renovations or a rise
in mortgage rates, for example), they must do so using an official
form. Any tenant who considers a rent increase unreasonable
has 30 days in which to submit a written appeal to the arbitration
authority.
The lease or rental agreement may be terminated by either the
tenant or the landlord. The required terms of notice are stated in
the agreement. Any tenant giving notice of termination must do
so in writing, preferably by registered letter. Married couples have
equal rights. This means that the notice of termination is not valid
unless signed by both spouses. When moving out, tenants are
required to hand over a clean property. The tenant and landlord
inspect the condition of the property together and record any
defects in writing. They decide jointly which party shall pay for
any repairs that might be necessary.
13.3.2 House rules and maintenance
In most cases, professional property management companies
are responsible for building management. In large buildings in
particular, there is also a building superintendent who can answer
tenants’ questions, make small repairs and oversee security and
maintenance. Regional tenants’ associations can also assist tenants
with problems.
What tenants need to know
www.bwo.admin.ch
Search: Infoblatt Wohnen
Languages: German, English, French, Italian, Portuguese
In general, tenants pay rent monthly – in advance for the next
month. Usually tenants also pay additional costs such as heating,
hot water or cable television costs.
Handbook for Investors 2010
123

Tenants’ associations
Telephone directory
German-speaking Switzerland: www.mieterverband.ch
Language: German
www.local.ch
Languages: German, English, French, Italian
French-speaking Switzerland: www.asloca.ch
Language: French
Ticino: www.asi-infoalloggio.ch
Language: Italian
Service providers and price comparisons
www.comparis.ch
Languages: German, English, French, Italian
13.4 Telephone, Internet and TV.
www.teltarif.ch
Language: German
Until liberalization in 1998, the Swiss telecommunications market
was dominated by Swisscom. Today the population can choose
among numerous providers of landline and mobile telephone,
VoIP and Internet services. Swisscom, Orange and Sunrise are
the major providers of mobile telephone services. In addition,
however, there are also other companies that use the networks
of the major providers and offer very attractive terms (including
M-Budget Mobile, Coop Mobile, Yallo and Mobilezone). All services
are also available to foreign nationals who are living in Switzerland
temporarily. However, registration is obligatory (even for prepaid
plans). Setting up Internet access is easy. Analog connections,
ISDN, DSL and various cable connections are available.
Cablecom and Swisscom are the market leaders for television.
With Cablecom’s analog cable connection, which is already installed
in half of all Swiss households, you can get approximately
40 TV channels with any television set. An additional receiver is
required for digital reception. It is also possible to receive over
100 channels via the telephone line with «Bluewin-TV» (from
Swisscom). More than 300 regional cable operators offer services
similar to those of Cablecom. And of course you can also receive
television channels via satellite. Anyone listening to the radio or
watching television in Switzerland must always pay reception
fees. These fees must be paid regardless of which programs are
watched or listened to or how they are received. The reception fees
for radio and TV channels are invoiced and collected by Billag AG.
Billag
www.billag.com
Languages: German, French, Italian
13.5 Insurance.
Swiss citizens have comprehensive insurance coverage. Swiss
families spend an average of 21 % of their household budget on
insurance overall. Medical insurance is by far the most expensive.
For further information see sections 11.6.2 and 13.8
Contributions to social security and unemployment insurance are
mandatory, as is medical and fire insurance. Contributions to social
security and unemployment insurance are set by the government
and are directly deducted from the salary. Medical and liability
insurance must be purchased privately based on one’s own choice
of provider.
For further information see section 8.2.2.
For further information see section 11.4.
124 Handbook for Investors 2010

Anyone who rents a property is urged to take out insurance
covering household contents and personal liability (available
either separately or in combination). Contents insurance covers
damage such as floor damage caused by an overflowing bathtub.
Personal liability insurance covers any damage caused by the
insured person to third parties (property damage and/or personal
injury).
Every owner of a motor vehicle is required to have motor vehicle
liability insurance. It covers personal injury and/or property damage
caused by operation of the insured motor vehicle, regardless
of who is driving the vehicle at the time of the accident. Partial
and comprehensive/collision insurance coverage is also recommended.
Anyone who rides a bicycle in Switzerland needs a
bicycle sticker («Velovignette»). This is a form of compulsory
liability insurance that covers personal injury or property damage
to third parties.
For further information see section 11.1.2.
Schedules and tickets
www.sbb.ch
Languages: German, English, French, Italian
Foreign visitors
www.swisstravelsystem.ch
Languages: German, English, French, Italian
13.6 Public transport.
Thanks to public transport, people in Switzerland have many
ways to get around even if they do not have their own car. The
rail, bus and boat network is very dense, and traffic intensity one
of the highest in the world. Boats not only operate for tourism
purposes but also represent important transport connections.
There is not a single village in Switzerland that is not served by
some form of public transport at least every two hours.
There is a wide range of tickets and passes for public transport.
The basic rule is that the longer a pass is valid, the cheaper it
is. For a 12-month pass you pay the equivalent of eight months’
worth of single tickets. And with the «General-Abo,» a one-year
pass for all forms of public transport, you can travel freely on the
SBB rail network, most private railroads, boats, buses and urban
transit networks. The low-priced «Halbtax-Abo,» which is available
for one, two or three years, gives holders a 50 % discount
on the full price. Children up to six years of age ride free, and
children under 16 can travel with the «Junior ticket» at no charge
when they are accompanied by their parents. Young people
between the ages of 16 and 25 can ride free in second-class cars
after 7 pm with the «Gleis 7» pass. While these special rates benefit
people residing in Switzerland, tourists can also benefit from
offers that are designed especially for them.
13.7 Leisure activities.
Fig. 68: Favorite leisure activities
Spending time with friends 76.1 %
Reading 75.1 %
Taking walks 72.6 %
Movies 67.6 %
Theater, opera or exhibitions 66.6 %
Sports 61.9 %
Handicrafts or gardening 53.9 %
Going to restaurants or cafés 49.2 %
Attending sporting events 46.7 %
Dancing 34.9 %
Source: swissinfo
13.7.1 Leisure and cultural activities
Switzerland offers a great variety of cultural and recreational
activities. It is no accident that the country is an ideal year-round
destination for nature lovers, sports enthusiasts, people seeking
peace and quiet, art-lovers and business travelers. Switzerland
stands for individuality, true relaxation, adventure and prestige.
Both tourists and permanent Swiss residents find just what they
need here: summer and winter sports on the doorstep, charming
market towns or busy urban centers, culture or nature, relaxation
or action, every hour of the day. Cultural life and opportunities for
participating in sports and social activities are plentiful, both in
the city and the countryside, due to decentralized residential de-
Handbook for Investors 2010
125

velopment. Switzerland is home to prestigious events such as the
music festivals in Lucerne and Montreux, the Menuhin Festival in
Gstaad, the Film Festival in Locarno, the European Masters golf
tournament in Crans-Montana and Swiss Indoor Tennis Basel. In
addition to these major events, there is also a lively local cultural
scene.
Volunteer work
www.forum-freiwilligenarbeit.ch
Languages: German, French
Swiss tourism, including calendar of events
13.8 Income and cost of living.
www.myswitzerland.com
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
Traditions in Switzerland
www.swissworld.org
Languages: German, English, French, Italian, Spanish, Russian,
Chinese, Japanese
13.7.2 Clubs and volunteer work
Many Swiss citizens are active in clubs and pursue hobbies with
other enthusiasts in their non-working hours. Even the smallest
communities and villages cultivate and promote an active cultural
and club life and offer the necessary infrastructure for sports. From
music, theater, sports and politics to ornithology, hiking and conservation
and even stamp collecting and first aid, there is hardly
an area of life that does not have its own special club. Men are
primarily involved in athletic, cultural and political groups, whereas
women participate not only in sports but also in charitable and
church-oriented activities. There is often no clear-cut dividing line
between hobbies and volunteer work. Approximately one quarter
of the population in Switzerland participates in institutionalized
volunteer efforts without pay. Since Switzerland does not require
clubs and organizations to be registered, there is no complete list.
However, the home pages of municipalities generally give information
about local clubs.
Swiss households consist on average of 2.2 persons and have a
monthly earned income of CHF 6,298. Together with income from
other sources and transfer income, gross income totals CHF 8,492.
After deduction of social security contributions and taxes, approximately
70 % remains as disposable income for consumption. There
are considerable regional differences in real disposable income
(after deduction of all fixed costs). Real disposable income is
below the Swiss average (low RDI value) not only in the business
centers but also in a small number of mountain communities.
These are popular tourism areas with very high real estate prices.
The canton of Appenzell Innerrhoden has the highest real disposable
income (high RDI value) ahead of Obwalden and Glarus,
while the urban cantons of Basel-Stadt and Geneva are at the
other end of the scale (Fig. 69).
Example (Credit Suisse Economic Research):
A couple with two children has a single-family residence of medium
standard (80 % mortgage). They have CHF 300,000 in savings,
and their joint earnings total CHF 150,000. After figuring in
the government family allowance and income from investments,
the household has a gross income of about CHF 157,000. After
deducting all the mandatory contributions (taxes, retirement and
social security contributions, and premiums for compulsory health
insurance) as well as living costs, ancillary costs and utilities, the
family has the following real disposable income:
• in Rheinfelden (Aargau), a municipality with a high RDI value:
CHF 61,400
• in Bettingen (Basel Stadt), a municipality with a low RDI value:
CHF 36,800
126 Handbook for Investors 2010

Fig. 69: Real disposable income in Swiss municipalities, 2008
RDI indicator
– 5.1 to – 2.0
– 1.9 to – 1.0
– 0.9 to – 0.3
– 0.2 to – 0.0
0.1 to 0.3
0.4 to 0.7
0.8 to 1.0
1.1 to 1.5
1.6 to 2.0
2.1 to 3.1
Cantons
Source: Credit Suisse Economic Research, Geostat
According to a UBS study (Fig. 71), Switzerland has the highest
purchasing power in the world, i.e. the highest real disposable income
when compared with prices. The price level in Zurich is the
fifth-highest in the world. Only Oslo, London, Copenhagen and
Dublin are more expensive. Geneva is in eighth place. Nonetheless,
salaries (earned incomes) in Zurich and Geneva can keep
pace in an international comparison and are in third and fourth
place behind Copenhagen and Oslo.
Consumer spending
www.swissworld.org
Languages: German, English, French, Italian, Spanish,
Russian, Chinese, Japanese
Statistics on income, consumption and wealth
www.bfs.admin.ch
Languages: German, French
Handbook for Investors 2010
127

Fig. 70: Average household budget, 2006
Gross income 8,492 100 %
Mandatory transfer expenses – 2,335 – 27.5 %
Social security contributions – 838 – 9.9 %
Taxes – 1,000 – 11.8 %
Health insurance funds: basic health
– 497 – 5.9 %
insurance
Other transfer expenses – 186 – 2.2 %
Available income 5,971 70.3 %
Other insurance, fees and transfers – 533 – 6.3 %
Consumer spending – 5,189 – 61.1 %
Food and non-alcoholic beverages – 627 – 7.4 %
Alcoholic beverages and tobacco products – 103 – 1.2 %
Restaurants and lodging – 511 – 6.0 %
Clothing and shoes – 225 – 2.7 %
Living costs and energy – 1,382 – 16.3 %
Furnishings and ongoing household costs – 269 – 3.2 %
Healthcare – 286 – 3.4 %
Transport – 721 – 8.5 %
Communications – 176 – 2.1 %
Entertainment, recreation and culture – 629 – 7.4 %
Other goods and services – 259 – 3.0 %
Sporadic income 309 3.6 %
Amount saved 558 6.6 %
Number of persons per household
2.23 100 %
(average)
Fig. 71: International comparison of purchasing power (including
rents), 2008
Cities
Net hourly income divided by
the cost of the entire basket
of commodities excl. rent.
(Zurich = 100)
Zurich 100.0
Geneva 94.5
Luxembourg 90.9
Berlin 89.5
Dublin 87.5
Frankfurt 86.5
Munich 83.2
Oslo 81.6
Helsinki 81.6
Brussels 79.5
Copenhagen 77.4
Lyon 73.9
Amsterdam 70.5
New York 69.6
Tokyo 65.8
London 63.7
Paris 61.0
Singapore 44.5
São Paolo 38.5
Hong Kong 34.1
Moscow 30.9
Shanghai 24.9
Beijing 20.7
Source: UBS, Prices and Earnings: A Comparison of Purchasing Power
Around the Globe, March 2008
Source: Federal Statistical Office, HABE 2006
128 Handbook for Investors 2010

14. Promoting Switzerland.
Location promotion is an important component of Swiss
economic policy and is done in partnership with the business
community and the cantons. Within the program Switzerland
Trade & Investment Promotion, Osec, a federal agency,
organizes and coordinates activities for promoting foreign
investment in Switzerland.
14.1 Responsibilities.
In accordance with Switzerland’s federal form of government,
responsibility for state location promotion is shared between the
federal government and the cantons.
Switzerland Trade & Investment Promotion is responsible at the
national level for marketing Switzerland as a business location to
investors in other countries. Osec also serves as the first point
of contact for foreign investors and puts them in touch with the
appropriate cantonal authorities.
It is the job of the cantonal economic development agencies to
inform potential investors about the advantages of locating a business
in their canton, maintain contact with interested investors,
present concrete location proposals and organize local support for
investors through regional offices and municipalities – even after
investments have been made – as a form of customer service.
14.2 Promotional policy and tools.
In line with Switzerland’s liberal economic system, economic
policy in Switzerland focuses on optimum structuring and support
of the general business environment. Financial assistance programs
are timely and strategic. In general, government financial
assistance always complements private initiatives.
The possible funding options, the mix of various instruments and the
scale of payments depend on the specific investment project. There
is always room for individual solutions. It is therefore advisable,
once a project has been roughly evaluated, to discuss it first with
the cantonal economic development agencies. Switzerland Trade
& Investment Promotion can provide assistance in this regard.
14.3 Switzerland Trade & Investment
Promotion services.
Switzerland. Trade & Investment Promotion opens the door to
Switzerland and its authorities. In close collaboration with partners
from different regions and cantons and from the private sector, the
program assists companies as they plan their operations:
• Selection of ideal locations in Switzerland
• Contacts to regional and cantonal investment offices
• Legal and administrative requirements
Handbook for Investors 2010
129

• Collaboration with research centers and universities
• The Swiss tax system and incentives for investors
• Partnering with Swiss firms in your area of business
• Residence and work permits
Switzerland. Trade & Investment Promotion supports companies
at any time during the fact finding and investment project. The
contact addresses can be found in the appendix.
14.4 Cantonal promotion.
Most Swiss cantons have their own economic development agencies.
All cantons can offer tax relief to businesses as an economic
development incentive. Other incentives or forms of economic
assistance vary from canton to canton, depending on interest and
regional economic conditions (see section 15.1).
Online publications or information events
www.invest-in-switzerland.com
Languages: German, English, French, Italian, Portuguese,
Russian, Chinese, Japanese
Directory of expert consultants
www.poolofexperts.ch
Language: English only
130 Handbook for Investors 2010

Fig. 72: Examples of cantonal incentives and economic assistance
Area of assistance
Investment financing
Procurement of land and premises
Personnel
Taxes
Type of assistance
• Granting or arranging bank loan guarantees
• Interest subsidies or assumption of interest costs
• Interest-free or subsidized-interest cantonal loans
• One-off contributions (non-repayable)
• Arranging for purchase or lease of business premises and land
• Cost contributions for planning and/or developing industrial sites
• Cost contributions for conversion of plant buildings
• Contributions to initial training or retraining costs
• Tax relief for startup and development phase and for restructuring projects
Source: Legal and informational documents from the cantonal economic development agencies
14.5 Tax relief as part of regional
policy.
As part of federal regional policy, there is specific support for
the economic development of structurally weak regions such as
mountain areas, rural districts and border areas. Major investment
and innovation projects and the establishment of new companies
in these regions can be supported by the federal government
through tax relief (see map of applicable regions in Fig. 73). The
main requirement for federal tax relief is that the canton in question
also supports the project by providing equivalent tax relief.
The application process for tax relief in connection with regional
policies is always handled by the cantons. The cantonal economic
development agencies in question provide advice on the best
way to proceed.
Tax relief (regional policy)
www.seco.admin.ch
Search for: Steuererleichterungen
Languages: German, French, Italian
See section 9.4.3 for further information.
Handbook for Investors 2010
131

Fig. 73: Applicable regions for tax relief, 2007
Eligible areas based on the DEA ordinance of November 28, 2007
Favored areas for a transitional solution until the end of 2010 (with maximum tax relief of 50 %)
Source: State Secretariat for Economic Affairs SECO
14.6 Other organizations providing
assistance.
14.6.1 CTI Innovation Promotion Agency
CTI is Switzerland’s federal innovation promotion agency. For
over 60 years, it has fostered knowledge and technology transfer
between businesses and universities. It brings partners from
these two areas together in applied research and development
projects and provides assistance to start-up companies during
the development phase. Switzerland has one of the highest levels
of innovation of any country in the world. CTI has a budget of
around CHF 100 million and operates under the «Science to Market»
slogan. Companies work with universities to generate new
knowledge that can be used to develop products and services
and bring them to market.
CTI provides funding for
• Market-oriented R&D projects carried out jointly by companies
and universities for developing products and services
• The formation and development of science-based companies
• Knowledge and technology transfer through platforms and
networks
132 Handbook for Investors 2010

R&D project grants are available in all disciplines involving scientific
innovation. Project applications are submitted in accordance
with the bottom-up principle. Grants are awarded on the basis of
innovative content and market potential.
In its Venturelab program, CTI helps promising entrepreneurs get
started by guiding them through customized training modules.
The modules give them the tools and methods they need to implement
an exciting business idea and establish a new company.
Young entrepreneurs can also apply for professional coaching.
Support is provided to knowledge-intensive technology-based
companies with great market potential.
CTI’s KTT initiative strengthens knowledge and technology transfer
between universities and industries in the same region. Professionally
run local KTT consortia provide assistance to SMEs and
universities in making contacts and developing projects. Innovative
Swiss companies and researchers are also offered development
opportunities through access to international programs and networks
such as IMS, ESA and EUREKA.
Innovation Promotion Agency (CTI)
www.kti-cti.ch
Languages: German, English, French, Italian
14.6.2 Technology parks and business incubation centers
Facilities and support centers designed to encourage or facilitate
entrepreneurial activity are part of a modern economy’s infrastructure.
Switzerland has a large number of technology parks
and business incubator or start-up centers. Most have joined
together to form networks or associations. They differ in concept
and specific focus; some have developed in close cooperation
with universities while others stem from purely private initiatives.
They offer premises (generally at preferential rates) for the startup
and development phase as well as shared infrastructure and
professional support. Participation by their umbrella organizations
in international networks allows them to use technology park infrastructures
throughout Europe. This allows companies to speed up
the difficult start-up phase and save on start-up costs. A number
of business incubation centers have also been formed in major
cities. They also serve as short-term start-up locations for foreign
companies establishing new operations in Switzerland by providing
flexible and expandable premises, contacts, and business
incubation support.
Advantages of technology parks and business incubation centers:
• Services: advisory services, coaching, telephone service, etc.
• Contacts with universities
• An environment surrounded by like-minded entrepreneurs
• Infrastructure and flexible premises
• Networking
• Higher chance of success; average survival rate over 90 %
National Organizations
Technopark Allianz
www.technopark-allianz.ch
Language: German
Association of Swiss Technology Parks and
Business Incubators
www.swissparks.ch
Language: German
Innopark
www.innopark.ch
Languages: German, English, French, Italian
Genilem
www.genilem.ch
Language: German
Handbook for Investors 2010
133

Fig. 74: Technology parks and incubator centers
Source: Location promotion program of the canton of Zurich, www.gruenden.ch
Berne/Mittelland
1 GründerZentrum Bern
www.innobe.ch
2 Berner Technopark
www.bernertechnopark.ch
3 innoBE AG* Bern, Biel, Thun
www.innobe.ch
4 Neuunternehmer-Zentrum WRT Thun
www.wrt.ch
5 e.Tower Thun
www.e-towers.ch
6 Gründerzentrum Solothurn, Solothurn
www.gzs.ch
7 Coaching service du Jura bernois Bévilard
www.cep.ch/coaching
Western Switzerland
8 Parc scientifique PSE, Lausanne
www.parc-scientifique.ch
9 biopôle park Lausanne
www.biopole.ch
10 Y-Parc AG, Yverdon
www.y-parc.ch
11 BioAlps, Geneva*
www.bioalps.ch
12 Eclosion SA, Plan-les-Ouates GE
www.eclosion.ch
13 Fongit, Geneva Incubator, Plan-les-Ouates GE
www.fongit.ch
14 Neode, La Chaux-de Fonds/Neuchâtel
www.neode.ch
15 Fri Up, Fribourg
www.friup.ch
Valais
16 CimArk SA*, Sion
www.cimark.ch
17 BioArk, Monthey
www.bioark.ch
18 IdeArk, Martigny
www.ideark.ch
19 PhytoArk, Sion
www.phytoark.ch
134 Handbook for Investors 2010

20 TechnoArk, Sierre
www.technoark.ch
21 Fondation The Ark, Sion
www.theark.ch
22 Sodeval SA, Naters*
www.ccf-valais.ch
Central Switzerland
23 Businesspark Zug
www.businessparkzug.ch
24 Technopark ® Luzern
www.technopark-luzern.ch
25 microPark Pilatus, Alpnach
www.microparkpilatus.ch
26 mccs – Micro Center Central-Switzerland AG, Sarnen
www.mccs.ch
27 areal #1 Unternehmerzentrum Nidwalden, Stansstad
www.nwcontact.ch
28 Technologiezentrum Steinen
www.technologiezentrum.ch
29 InnovationsTransfer Zentralschweiz, Horw*
www.itz.ch
30 Zentrum für neue Technologien Hohle Gasse, Küssnacht
www.hohle-gasse.ch
Northwest Switzerland
31 business parc Reinach
www.businessparc.ch
32 Tenum AG Liestal
www.tenum.ch
33 Technologiezentrum Witterswil
www.tzw-witterswil.ch
34 Spin-off Inkubator Basel
www.eva-basel.ch
35 business parc Reinach im Laufental, Zwingen
www.businessparc.ch
36 Technologie- und Gründerzentrum Zurzibiet
www.tg-zurzibiet.ch
37 Technopark Aargau, Windisch
www.technopark-aargau.ch
Zurich/Eastern Switzerland
38 StartZentrum Zürich
www.startzentrum.ch
39 Technopark ® Zürich
www.technopark.ch
40 glaTec Dübendorf
www.glatec.ch
41 grow Gründerorganisation Wädenswil
www.grow-waedenswil.ch
42 Technologiezentrum Linth, Ziegelbrücke
www.technologiezentrum.ch
43 Stiftung Futur, Rapperswil
www.futur.ch
44 Technologiepark Wetzikon
www.tp-wetzikon.ch
45 ri.nova impulszentrum Rebstein
www.rinova.ch
46 E-Tower*, Chur
www.e-towerchur.ch
47 Innozet, Grüsch
www.initial-gr.ch
48 Technopark® Winterthur
www.technopark-winterthur.ch
49 InnoPark Schweiz AG
www.innopark.ch
50 Tedizentrum Wil, Flawil, Wattwil
www.tedizentrum.ch
51 Gründerzentrum Hipomat, Schwarzenbach
www.hipomat.ch
52 START! Gründungszentrum, Frauenfeld
www.gruendungszentrum.ch
53 HTC High-Tech-Center AG, Tägerwilen
www.high-tech-center.ch
54 Spider Town, Tägerwilen
www.spidertown.ch
55 ITS Industrie- und Technozentrum, Schaffhausen*
www.its.sh.ch
56 tebo, St. Gallen
www.tebo.ch
57 Biotech Center Zürich-Schlieren
www.biotechcenter.ch
Ticino
58 Centro Promozione Start-up e Acceleratore d’impresa
www.cpstart-up.ch
59 Tecnopolo Ticino, Lugano
www.tecnopolo-ticino.ch
60 Galleria High-Tech-Center, Manno
www.galleria.ch
* These centers offer services but no office space.
Handbook for Investors 2010
135

15. Appendix.
15.1 Addresses.
Head Office
Osec
Stampfenbachstrasse 85
P.O Box 2407
CH-8021 Zurich
Tel. +41 44 365 51 51
Fax +41 44 365 52 21
info@osec.ch
www.osec.ch
Location Promotion
Switzerland. Trade & Investment
Promotion.
c/o Osec
Hans Jörg Jegge
Head of Location Promotion
Stampfenbachstrasse 85
P.O Box 2407
CH-8021 Zurich
Tel. +41 44 365 51 51
Fax +41 44 365 52 21
locationpromotion@osec.ch
Regional Directors
Europe
Switzerland. Trade & Investment
Promotion.
c/o Osec
Axel Bermeitinger
Regional Director Europe
Stampfenbachstrasse 85
P.O. Box 2407
CH-8021 Zurich
Tel. +41 44 365 51 51
Fax +41 44 365 52 21
europa@osec.ch
Americas
Switzerland. Trade & Investment
Promotion.
c/o Swiss Business Hub USA
Martin von Walterskirchen
Regional Director Americas
737 North Michigan Avenue,
Suite 2301
Chicago, IL 60611-2615, USA
Tel. +1 312 915 0061
Fax +1 312 915 0388
americas@osec.ch
Asia Pacific
Switzerland. Trade & Investment
Promotion.
c/o Swiss Business Hub ASEAN
Thomas Wicki
Regional Director Asia Pacific
1 Swiss Club Link
Singapore 288162
Tel. +65 6468 5788
Fax +65 6466 8245
asiapacific@osec.ch
IMEA (India, Middle East &
Africa)
Switzerland. Trade & Investment
Promotion.
c/o Swiss Business Hub GCC
Christian Watts
Regional Director IMEA
Dubai World Trade Center
Dubai
United Arab Emirates
Tel. +971 4 329 09 99
Fax +971 4 331 36 79
imea@osec.ch
Representatives
France
Suisse. Promotion
du Commerce et des
Investissements.
c/o Ambassade de Suisse
Maryse Marcherat
Directeur France
142, rue de Grenelle
F-75007 Paris
Tel. +33 1 49 55 67 07
Fax +33 1 49 55 67 67
mmarcherat@osec.ch
USA
Switzerland. Trade & Investment
Promotion.
c/o Consulate General of
Switzerland.
Daniel Bangser
Director North America,
Investment Promotion
Trade Commissioner
633 Third Avenue, 30th Floor
New York, NY 10017-6706,
USA
Tel. +1 212 599 5700 ext. 1032
Fax +1 212 599 4266
dbangser@osec.ch
136 Handbook for Investors 2010

Switzerland. Trade & Investment
Promotion.
c/o Consulate General of
Switzerland.
Caroline Blaser
Representative North Amercia
633 Third Avenue, 30th Floor
New York, NY 10017-6706,
USA
Tel. +1 212 599 5700 ext. 1034
Fax +1 212 599 4266
cblaser@osec.ch
China
Switzerland. Trade & Investment
Promotion.
c/o Swiss Business Hub China
Claudio Mazzucchelli
Head of SBH
Sanlitun Dongwujie 3
100600 Beijing, China
Tel. +86 10 8532 88 88
Fax +86 10 6532 43 53
bei.sbhchina@eda.admin.ch
Japan
Switzerland. Trade & Investment
Promotion.
c/o Swiss Business Hub Japan
Keisuke Hara
Chief Representative Japan
5-9-12 Minami Azabu, Minato-ku
Tokyo 106-8589, Japan
Tel. +81 3 5449 8408
(international calls)
Tel. 0120 844 313 (toll free,
domestic calls only)
Fax +81 3 3473 6090
khara@osec.ch
India
Switzerland. Trade & Investment
Promotion.
c/o Consulate General of
Switzerland
Fabian T. Stiefvater
Counsellor
502 Dalamal House, 5 th Floor
206, Jamnalal Bajaj Marg
Nariman Point
Mumbai 400 021
India
Tel. +91 22 4343 5600
Fax +91 22 4343 5612
mum.sbhindia@eda.admin.ch
Swiss Embassy in the United
States of America
Embassy of Switzerland
2900 Cathedral Avenue, NW
US-Washington, DC 20008
Tel. +1 202 745 79 00
Fax.+ 1 202 387 25 64
was.vertretung@eda.admin.ch
www.eda.admin.ch/washington
Swiss Embassy in Canada
Embassy of Switzerland
5 Marlborough Avenue
CA-Ottawa, ON, K1N 8E6
Tel. +1 613 235 18 37
Fax.+1 613 563 13 94
ott.vertretung@eda.admin.ch
www.eda.admin.ch/canada
Cantonal Economic
Development Agencies
Aargau (AG)
Aargau Services
Location Marketing
Rain 53
CH-5001 Aarau
Tel. +41 62 835 24 40
Fax +41 62 835 24 19
aargau.services@ag.ch
www.aargauservices.ch
Appenzell Ausserrhoden (AR)
Department of Economic
Affairs & Agriculture
Office of Economic Affairs
Government Building
CH-9102 Herisau
Tel. +41 71 353 64 43
Fax +41 71 353 62 59
info@wifoear.ch
www.ar.ch/wirtschaft
Appenzell Innerrhoden (AI)
Economic Development
Marktgasse 2
CH-9050 Appenzell
Tel. +41 71 788 94 44
Fax +41 71 788 94 45
wirtschaft@ai.ch
www.ai.ch
Basel-City (BS) and Basel-
Country (BL)
BaselArea
Economic Promotion
Aeschenvorstadt 36
CH-4010 Basel
Tel. +41 61 295 50 00
Fax +41 61 295 50 09
info@baselarea.ch
www.baselarea.ch
Berne (BE)
Berne Economic Development
Agency
Münsterplatz 3
CH-3011 Berne
Tel. +41 31 633 41 20
Fax +41 31 633 40 88
info@berneinvest.com
www.berneinvest.com
Fribourg (FR)
Fribourg Development Agency
Avenue de Beauregard 1
CH-1700 Fribourg
Tel. +41 26 425 87 00
Fax +41 26 425 87 01
promfr@fr.ch
www.promfr.ch
Geneva (GE)
Geneva Economic
Development Office
Rue des Battoirs 7
P.O. Box 740
CH-1211 Geneva 4
Tel. +41 22 388 34 34
Fax +41 22 388 31 99
promotion@etat.ge.ch
www.geneva.ch
Glarus (GL)
Office of Economic Affairs
Zwinglistrasse 6
CH-8750 Glarus
Tel. +41 55 646 66 14
Fax +41 55 646 66 09
kontakt@glarusnet.ch
www.glarusnet.ch
Grisons (GR)
Economic Development and
Tourism Agency
Economic Development
Grabenstrasse 1
CH-7001 Chur
Tel. +41 81 257 23 42
Fax +41 81 257 21 92
info@awt.gr.ch
www.awt.gr.ch
Jura (JU)
Economic Development
12, rue de la Préfecture
CH-2800 Delémont
Tel. +41 32 420 52 20
Fax +41 32 420 52 21
bde@jura.ch
eco.jura.ch
Lucerne (LU)
Business Development
Lucerne
Alpenquai 30
CH-6005 Lucerne
Tel. +41 41 367 44 00
Fax +41 41 367 44 01
info@lucerne-business.ch
www.lucerne-business.ch
Neuchâtel (NE)
Office de Promotion
Économique du canton
de Neuchâtel
Collégiale 3
CH-2000 Neuchâtel
Tel. +41 32 889 68 23
Fax +41 32 889 62 95
open@ne.ch
www.e-den.ch
Nidwalden (NW)
Economic Promotion
Canton Nidwalden
Dorfplatz 7a
CH-6371 Stans
Tel. +41 41 618 76 54
Fax +41 41 618 76 58
wirtschaftsfoerderung@nw.ch
www.nw.ch
Handbook for Investors 2010
137

Obwalden (OW)
Business & residential
promotion in Obwalden
Dorfplatz 1
CH-6060 Sarnen
Tel. +41 41 660 90 66
Fax +41 41 660 90 69
info@iow.ch
www.iow.ch
Schaffhausen (SH)
Economic Promotion
Canton Schaffhausen
Herrenacker 15
CH-8200 Schaffhausen
Tel. +41 52 674 03 03
Fax +41 52 674 06 09
economic.promotion@
generis.ch
www.sh.ch/wf
Schwyz (SZ)
Office for Economy
Economic Development Canton
Schwyz
Bahnhofstrasse 15
P.O. Box 1187
CH-6431 Schwyz
Tel. +41 41 819 16 34
Fax +41 41 819 16 19
businesspromotion@sz.ch
www.schwyz-economy.ch
Solothurn (SO)
Solothurn Economic
Development Agency
Untere Sternengasse 2
CH-4509 Solothurn
Tel. +41 32 627 95 23
Fax +41 32 627 95 92
wifoe@awa.so.ch
www.standortsolothurn.ch
St.Gallen (SG)
Location Promotion
Business Development Agency
Canton of St. Gallen
Davidstrasse 35
CH-9001 St.Gallen
Tel. +41 71 229 35 60
Fax +41 71 229 47 40
beat.ulrich@sg.ch
www.location.sg.ch
Ticino (TI)
Sezione della promozione
economica
Viale S. Franscini 17
CH-6501 Bellinzona
Tel. +41 91 814 35 41
Fax +41 91 814 44 57
info@copernico.ch
www.copernico.ch
Thurgau (TG)
Thurgau Business
Development Agency
Zürcherstrasse 183
CH-8510 Frauenfeld
Tel. +41 52 724 26 06
Fax +41 52 724 26 37
info@wiftg.ch
www.wiftg.ch
Uri (UR)
Economic Affairs, Canton of Uri
Department of Economic Development
Klausenstrasse 4
CH-6460 Altdorf
Tel. +41 41 875 24 01
Fax +41 41 875 24 12
wirtschaft@ur.ch
www.ur.ch/wfu
Valais (VS)
Department of Economic
Affairs and Regional Planning
Office of Economic
Development
Business Valais
Villa de Riedmatten
Avenue Ritz 1
CH-1950 Sion
Tel. +41 27 606 50 15
Fax +41 27 606 50 14
devs@admin.vs.ch
www.business-valais.ch
Vaud (VD)
Economic Development
Canton of Vaud (DEV)
Avenue de Gratta-Paille 2
P.O. Box 452
CH-1000 Lausanne 30
Tel. +41 21 644 00 60
Fax +41 21 644 00 79
jean-frederic.berthoud@
dev.ch
www.dev.ch
Zug (ZG)
Economic Promotion
Aabachstrasse 5
CH-6301 Zug
Tel. +41 41 728 55 04
Fax +41 41 728 55 09
economy@zug.ch
www.zug.ch/economy
Zurich (ZH)
Office of Economy and Labour
of the Canton of Zurich
Economic Development
Walchestrasse 19
CH-8090 Zurich
Tel. +41 43 259 26 13
Fax +41 43 259 51 71
standort@vd.zh.ch
www.standort.zh.ch
Important notice
Regional Location Marketing
Organizations
Greater Geneva Berne Area
Economic Development
Agency
World Trade Center
Avenue de Gratta-Paille 2
PO Box 253
CH-1000 Lausanne 22
Tel. +41 21 644 00 90
Fax +41 21 644 00 99
info@ggba-switzerland.org
www.ggba-switzerland.org
Greater Zurich Area AG
Limmatquai 112
CH-8001 Zurich
Tel. +41 44 254 59 59
Fax +41 44 254 59 54
info@greaterzuricharea.ch
www.greaterzuricharea.ch
BaselArea
Aeschenvorstadt 36
CH-4010 Basel
Tel. +41 61 295 50 00
Fax +41 61 295 50 09
info@baselarea.ch
www.baselarea.ch
Business Location Ostschweiz
c/o Office of Economic and
Labor Affairs
Zürcherstrasse 183
CH-8510 Frauenfeld
Tel. +41 52 724 22 43
Fax +41 52 724 26 37
ralph.roggensinger@tg.ch
www.ost-schweiz.ch
The information and data contained in this publication are
drawn from a variety of sources and have been researched
with the greatest possible care. Persons wishing to use information
from this publication do so at their own risk. Osec as
well as third parties who have provided input for the various
sections (e.g. PricewaterhouseCoopers) assume no liability
for the accuracy, currency or completeness of the information
published in the Investor’s Handbook.
138 Handbook for Investors 2010

15.2 Table of figures.
Fig. 1: Switzerland’s international rankings ......................... 9
Fig. 2: Map of Switzerland’s location ................................. 10
Fig. 3: Direct democracy ................................................... 12
Fig. 4: Political stability ...................................................... 13
Fig. 5: Globalization ........................................................... 15
Fig. 6: International organizations headquartered in
Switzerland ............................................................. 16
Fig. 7: Switzerland in figures ............................................. 17
Fig. 8: 2008 (nominal) per capita gross domestic
product in USD ....................................................... 18
Fig. 9: Industry structure, percentage of employees ......... 19
Fig. 10: 2008 competitiveness ranking Global
Competitiveness Index (GCI).................................. 19
Fig. 11: 2006 Global Innovation Index ................................. 19
Fig. 12: Trade balance as a % of GDP ................................ 20
Fig. 13: Imports and exports by countries ........................... 20
Fig. 14: Direct investments .................................................. 21
Fig. 15: Economic freedom ................................................. 27
Fig. 16: Guide for innovative and creative minds ................ 30
Fig. 17: Overview of legal forms .......................................... 42
Fig. 18: Procedure for establishing a company
(AG, GmbH) ............................................................ 46
Fig. 19: Do I need a visa? .................................................... 49
Fig. 20: Visa regulations for certain countries ..................... 49
Fig. 21: Types of permits ..................................................... 51
Fig. 22: Work and residence permits: rules and
procedures.............................................................. 54
Fig. 23: Countries with which Switzerland has a
trainee agreement ................................................... 57
Fig. 24: Online sources of information on real estate .......... 58
Fig. 25: Market prices for office space, as of
fourth quarter .......................................................... 59
Fig. 26: Steps in a purchase transaction ............................. 60
Fig. 27: Construction sites: market prices for
commercial buildings .............................................. 61
Fig. 28: Market prices for rental apartments ....................... 62
Fig. 29: Market prices for owner-occupied apartments ........ 63
Fig. 30: Permit requirement by group .................................. 65
Fig. 31: International comparison of worker motivation ....... 67
Fig. 32: International experience ......................................... 68
Fig. 33: Gross monthly salary (median), broken down
by industry and region ............................................ 68
Fig. 34: Gross annual earned income in each
occupational group in CHF .................................... 69
Fig. 35: Industry labor costs: direct remuneration
and non-wage labor costs ...................................... 69
Fig. 36: Gross annual earned income in each
occupational group ................................................. 70
Fig. 37: Labor market deregulation ..................................... 71
Fig. 38: Cooperation between employers and employees ...... 72
Fig. 39: Demarcation of day, evening and night .................. 73
Fig. 40: Appointments and dismissals ................................. 75
Fig. 41: Overview of compulsory contributions ................... 76
Fig. 42: Global financial centers .......................................... 81
Fig. 43: Mortgage interest rates .......................................... 85
Fig. 44: State incentives ...................................................... 87
Fig. 45: Credit rating: the ten safest countries .................... 88
Fig. 46: Capital costs ........................................................... 88
Fig. 47: Inflation ................................................................... 89
Fig. 48: Total tax rate (TTR).................................................. 93
Fig. 49: International business activity ................................ 99
Fig. 50: Quality of the infrastructure .................................. 102
Fig. 51: Direct intercontinental air connections from
Zurich and Geneva ............................................... 105
Fig. 52: National and regional airports in Switzerland ....... 106
Fig. 53: Internet subscribers .............................................. 107
Fig. 54: Healthcare infrastructure ...................................... 109
Fig. 55: Switzerland’s educational system ........................ 111
Fig. 56: Quality of the educational system ........................ 112
Fig. 57: Public spending on education per capita in USD ...... 112
Fig. 58: Swiss higher education landscape ....................... 114
Fig. 59: Tuition fees in CHF per year ................................. 115
Fig. 60: Executive MBA: the top schools........................... 116
Fig. 61: School fees for international private schools........ 117
Fig. 62: Total per capita expenditure on research
and development in USD ..................................... 118
Fig. 63: Nobel prizes per million inhabitants...................... 118
Fig. 64: Research institutions in Switzerland ..................... 118
Fig. 65: Global comparison of quality of living .................. 120
Fig. 66: Personal safety ..................................................... 121
Fig. 67: Attractiveness for highly qualified employees
from foreign countries........................................... 121
Fig. 68: Favorite leisure activities ...................................... 125
Fig. 69: Real disposable income in Swiss municipalities ........127
Fig. 70: Average household budget................................... 128
Fig. 71: International comparison of purchasing
power (including rents) ......................................... 128
Fig. 72: Examples of cantonal incentives and
economic assistance ............................................ 131
Fig. 73: Applicable regions for tax relief ............................ 132
Fig. 74: Technology parks and incubator centers ............. 134
Handbook for Investors 2010
139

15.3 Possible service partners.
Serving the international communities of
Central Switzerland since 1961
• From Pre-Kindergarten to university entrance (ages 3-18)
for every stage of a student’s individual development
• IB PYP, IB MYP, IB Diploma Programme and 16 subjects
at Advanced Placement (AP) leading to exceptional
university and college acceptances worldwide
• A caring, respectful and supportive environment with
close student-teacher relationships that focuses on
academic achievement
• Comprehensive offerings in arts, music and sports
(competitive and extra-curricular) and the International
Award Scheme
One International Experience –
Three Campuses
Zug Campus (Main Office)
Walterswil, 6340 Baar
Switzerland
Telephone +41 41 768 1188
office.zug@iszl.ch
www.iszl.ch
Choose Switzerland, and you’ll be choosing the best location.
But do you also have the consultant who knows it best?
Your contact partner for location planning, tax planning and transactions:
georges.meyer@ch.pwc.com, telephone +41 58 792 43 88
PricewaterhouseCoopers AG, Birchstrasse 160, CH-8050 Zurich, Switzerland
www.pwc.ch
140 Handbook for Investors 2010

Countries of Europe.
Handbook for Investors 2010
141

Swiss map.
142 Handbook for Investors 2010

Language regions.
Handbook for Investors 2010
143

Osec
Stampfenbachstrasse 85
P.O Box 2407
CH-8021 Zurich
Tel. +41 44 365 51 51
Fax +41 44 365 52 21
info.zurich@osec.ch
Osec
Corso Elvezia 16
P.O Box 5399
CH-6901 Lugano
Tel. +41 91 911 51 35
Fax +41 91 911 51 39
info.lugano@osec.ch
Osec
Avenue d’Ouchy 47
P.O Box 315
CH-1001 Lausanne
Tel. +41 21 613 35 70
Fax +41 21 613 35 02
info.lausanne@osec.ch
Copyright © Osec. January 2010. All rights reserved.
Our Hotline: +41 44 365 51 15
www.invest-in-switzerland.com