New rules regarding solvency, capital loss, and over-indebtedness
The New Swiss Company Law
The new Swiss company law came into force on 1 January 2023.
New rules exist in particular with regard to solvency, loss of capital and over-indebtedness (Article 725 of the Swiss Code of Obligations).
The board of directors in the case of a joint-stock company or the management of a limited liability company is obliged to take steps to reorganise the company in the case of "imminent insolvency". These steps should also be well documented.
Companies that are not subject to a regular audit and have waived a limited audit are now also obliged to have their last ﬁnancial statements audited by an auditor in the following cases:
- In the event of underfunding of half of the capital (capital loss)
- In the event of over-indebtedness
This applies to all annual and interim ﬁnancial statements prepared after 1 January 2023, i.e. also to financial statements as of 31 December 2022.
The affected companies have a specific deadline of a maximum of 90 days from the determination of a capital loss or over-indebtedness to restructure or to conduct a limited audit.
Initial reorganisation measures can be:
- Letters of subordination
- Transfer of loans into equity capital
- Transfer of loans to a capital contribution reserve
- Other measures
Depending on the restructuring measure chosen, any tax consequences must be examined. Concrete procedure:
As your accounting office, we will proactively inform you in the speciﬁc case of a possible audit obligation as explained above. We are at your disposal at any time for questions and advice.