AG or GmbH: what the legal form tells you

Most Swiss trading companies you will meet are either an AG (SA in French and Italian) or a GmbH (Sàrl, Sagl). Both are capital companies, both limit shareholder liability to the company's assets, and both appear in the commercial register with the same fields. The differences between them are narrower than folklore suggests — but two of them change what you can actually learn about a counterparty, which makes the legal form the first thing worth reading on any register extract.

The core differences

Capital

An AG is formed with a share capital of at least CHF 100,000, of which only a statutory minimum has to be paid up at formation — a company with a fully subscribed but partly paid capital is entirely normal, and the register shows the paid-in amount. A GmbH is formed with at least CHF 20,000 in quota capital, and it must be paid in full.

Two consequences follow. The first is trivial: capital is a formation threshold, not a measure of substance. A company can hold the minimum capital and turn over a hundred times that, or hold a large nominal capital and have spent it years ago. The second is more useful: because the register shows the capital and its paid-in portion, a capital movement is a public event, and capital movements tend to accompany real ones.

Recent company-law reform has also loosened the mechanics — capital may be denominated in a currency essential to the business, and an AG may operate within a capital band that lets its board move the capital inside a defined range. Where you see these features, read the articles of association rather than assuming the classical model.

Who is visible

This is the difference that matters most in due diligence.

A GmbH's quotaholders are entered in the commercial register, by name, with the nominal value of the quotas they hold. Ownership is public, and every change of ownership is a register mutation with a corresponding gazette publication. You can read the cap table and its history without asking anyone — the entry for Google Switzerland GmbH, for instance, names the corporate quotaholder behind it and not only the people who run it.

An AG's shareholders are not in the register. The company maintains its own share register, and, in a non-listed company, a list of the beneficial owners behind shareholders who cross the statutory reporting threshold. Neither is public. The register tells you who runs the company, not who owns it: the entry for Swisscom Immobilien AG gives you a board and a set of signatories, and stops there — the shareholder behind it is something you know from elsewhere, not from the register.

So the legal form determines whether ownership is a research question or a request-and-negotiate question. For an AG, ownership information comes from the counterparty, from a shareholder declaration, or from disclosure duties that apply only to listed issuers — not from the public record.

Transferring an interest

An AG share transfers under the rules for the security concerned, and the articles may impose transfer restrictions. Nothing about an ordinary transfer touches the commercial register.

A GmbH quota is different. Transfer requires written form, and unless the articles provide otherwise, the quotaholders' meeting must approve it. The transfer then has to be reflected in the register. The friction is deliberate: the GmbH is built as a form where the identity of the co-owners is meant to matter.

The GmbH also allows obligations an AG shareholder never has. The articles can impose ancillary duties or an obligation to make further contributions beyond the subscribed capital, within limits. If you are looking at a GmbH, read its articles before assuming a quota is a purely passive financial interest.

Management

An AG is managed by a board of directors, which may delegate day-to-day management. In a GmbH, the quotaholders are entitled to manage the business themselves unless the articles say otherwise, and the company appoints one or more managing officers. Both forms require at least one person able to represent the company who is resident in Switzerland — and whichever form you are looking at, those names can be followed across the other companies they serve.

Audit obligations do not distinguish the two forms at all. Whether a company is subject to an ordinary audit, a limited audit, or has validly opted out of an audit depends on its size and its shareholders' consent, not on whether it is an AG or a GmbH.

The two forms side by side

	AG	GmbH
Minimum capital	CHF 100,000 share capital	CHF 20,000 quota capital
Paid in at formation	A statutory minimum, not necessarily all of it; the register shows the paid-in amount	In full
Owners in the register	Not entered — the company keeps its own share register, which is not public	Entered by name, with the nominal value of the quotas they hold
Transfer of ownership	No register entry for an ordinary transfer; the articles may impose transfer restrictions	Written form and, unless the articles provide otherwise, approval of the quotaholders' meeting — then reflected in the register
Management organ	Board of directors, which may delegate day-to-day management	Quotaholders may manage themselves unless the articles say otherwise; one or more managing officers appointed
Audit obligation	Not a function of the legal form: ordinary audit, limited audit or a valid opt-out follows size and shareholder consent	The same rules, on the same terms

What does the choice of legal form signal?

Nothing definitive, but it is a reasonable prior. A GmbH is built around a known circle of co-owners, an AG around transferable shares — and most of what people read into the two forms follows from that one distinction.

• A GmbH is common for owner-managed businesses, small professional operations, subsidiaries of foreign groups, and joint ventures where the parties want a say in who joins them.
• An AG is common where there is outside capital, an intention to bring in investors, a plan to transfer shares without publicising it, or simply a preference for the more prestigious form.

Two register events are worth registering as facts rather than conclusions. A conversion from GmbH to AG changes what is public: the quotaholder list stops being updated and ownership disappears from the record going forward. That is a lawful, routine step in a financing, and it also has the effect of closing a window — so note the last published quotaholder list before it does. Conversely, an AG that files a capital increase shortly before a transaction is telling you something about its funding, though not who funded it.

The caveat worth keeping

Neither form is a quality signal. The register records legal facts; it does not certify that a company is solvent, competent or a reliable counterparty. An AG with a large nominal capital can be an empty shell, and a two-person GmbH can be the better credit. Use the legal form to work out what evidence is available to you, then go and find the evidence.

In practice

A company profile shows the legal form, capital and officers from the register, and for a GmbH the published quotaholders alongside them — so the first thing to do with a counterparty is to find its register entry and read the form off it. Changes of form and capital are register events, which means they arrive as publications: the gazette is where they show up, in the order they happened.

Frequently asked questions

How can I find out who owns a Swiss AG?

Not from the commercial register: it names the board and the signatories, not the shareholders. The company keeps its own share register and, if it is not listed, a list of the beneficial owners behind shareholders who cross the statutory reporting threshold — neither of which is public. In practice the information comes from the counterparty itself, from a shareholder declaration you make a condition of the deal, or from the disclosure duties that apply only to listed issuers. If a GmbH sits somewhere in the same group, its own register entry names its quotaholders and can get you one rung further up the chain.

Does a change of ownership show up in the commercial register or the gazette?

For a GmbH, yes: a transfer of quotas is entered with the new quotaholder's name and the nominal value held, and published in the Swiss Official Gazette of Commerce like any other mutation. For an AG, no: an ordinary share transfer touches neither the register nor the gazette, and a company can change hands without a single publication appearing. What you may see instead are the second-order events — a new board, a changed list of signatories, a capital increase — which tell you that something happened without telling you who is behind it.

Is an AG more trustworthy than a GmbH because its minimum capital is higher?

No. Capital is a threshold for formation, not a measure of substance: the extract shows the nominal capital and how much of it was paid in, not what the company is worth today. An AG can carry CHF 100,000 of nominal share capital and have spent it years ago, and a two-person GmbH can be the better credit risk. Read the legal form as an indicator of what evidence is available to you — accounts, payment behaviour, the register history — not as a verdict.

Can a GmbH quotaholder be asked for more money than the quota cost?

Possibly, and this is where the two forms genuinely differ. Towards creditors, only the company's assets are liable in both forms. But a GmbH's articles can impose ancillary duties or an obligation to make further contributions beyond the subscribed capital, within the limits the law sets; these are owed to the company, not to its creditors. An AG shareholder never carries such obligations, so read the articles of association before treating a quota as a purely passive financial interest.

Does the legal form decide whether a company needs an auditor?

No, and this is one of the most persistent misconceptions about the two forms. Whether a company is subject to an ordinary audit, a limited audit, or has validly opted out of an audit follows its size and the consent of its shareholders, not whether the extract says AG or GmbH. In practice that means the absence of an auditor in a register entry tells you the company is small and its owners agreed to the opt-out — it is not in itself irregular.

AG, SA, GmbH, Sàrl, Sagl: which abbreviation means what?

The same two forms carry different names across the language regions. An AG is a société anonyme (SA) in French and a società anonima (SA) in Italian; a GmbH is a société à responsabilité limitée (Sàrl) in French and a società a garanzia limitata (Sagl) in Italian. The abbreviation is part of the registered company name, which makes it the quickest way to read the legal form off any Swiss entry, whichever canton registered it. One trap worth knowing: a Swiss stock corporation is an SA in Italian — never SpA, which is the Italian form, not the Swiss one.