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Open a SICAF in Switzerland

Open a SICAF in Switzerland

When setting up investment funds in Switzerland, investors must first choose the vehicle under which the fund will operate. As one of the most important financial centers in the world, Switzerland provides for various types of investment vehicles that can be used, among these the SICAF, short from société d’investissement à capital fixe or investment company with a fixed capital, is one of the most sought.

Below, we invite you to read about the creation of a Swiss SICAF company if you want to set up an investment fund in this country. Our company formation agents in Switzerland can help you open an investment fund under a SICAF and can explain the legislation on investment funds in this country.

The Swiss SICAF – main characteristics

The SICAF will take the form of a limited liability company which will operate as a joint stock company in Switzerland. Moreover, the SICAF is a corporate form often employed for the creation of an investment fund by local and foreign professional investors.

The following aspects need to be considered when opening a SICAF in Switzerland:

  1. the company can be registered as an investment company with the Swiss authorities;
  2. it required approval from the Financial Markets Supervisory Authority in Switzerland;
  3. it is usually employed for the creation of closed-ended investment funds;
  4. it is not allowed to issue shares that offer special rights to specific categories of shareholders;
  5. it must be audited by an external auditor and the assets must be entrusted with an external custodian;
  6. it must be able to issue shares with a minimum value of 500,000 CHF at the time of incorporation.

Another important aspect to consider about the SICAF is that its share capital must be fixed and must be maintained so during the entire period it is created for. As a matter of fact, this is the main difference between the Swiss SICAF and SICAV, which is an investment company with a variable capital.

If you want to open a company in Switzerland with the purpose of setting up an investment fund, our local consultants can help with the incorporation of a SICAF.

Registration requirements for a SICAF in Switzerland

The SICAF will undergo registration as any other type of company in Switzerland with the Trade Registrar. For this purpose, the following aspects need to be considered:

  • – the company must have a trading name which must bear the abbreviation SICAF or the description of the selected legal entity;
  • – its minimum share capital must be 500,000 CHF, as mentioned above;
  • – it must be incorporated based on its Articles of Association.

Once it is registered, the Swiss SICAF must undergo authorization with the Financial Markets Supervisory Authority in Switzerland (FINMA).

Our company registration advisors in Switzerland can offer more information on the formation requirements for a SICAF.

Authorization of SICAFs in Switzerland

Once registered with the Trade Register, the Swiss investment company with a fixed capital must undergo authorization with FINMA. The operating license must be obtained prior to the SICAF starting its activities. In order to obtain its license, the following aspects need to be considered:

  • – FINMA must approve the SICAF’s statutory documents;
  • – the company must also prepare the investment regulations under the form of a prospectus which must also be approved;
  • – the company must have an appropriate ratio of equity capital and total assets;
  • – proof that the share capital is fully paid up must be filed with FINMA;
  • – information about the custodian bank and external auditor must also be provided.

Other aspects that need to be taken into account upon the creation of a SICAF in Switzerland is that the main purpose of the company is to obtain returns and/or capital gains and that it cannot provide any type of service to other companies.

The SICAF must also define its investment regulations, policies and restrictions. Apart from these, a document providing for risk diversification and risks associated with the investments must be filed with FINMA.

Our Swiss company formation specialists can offer more information on the authorization requirements imposed in SICAF companies.

Taxation of SICAFs in Switzerland

From a taxation point of view, the Swiss SICAF or better said the investors must consider the following levies:

  • – a 35% withholding tax is imposed to SICAFs on the distribution of profits provided that these are not accumulated profits;
  • – an issuance stamp tax of 1% is also levied upon the issue of shares in a SICAF;
  • – a transfer stamp tax is imposed at a rate of 0.15% if the interests or shares are issued to foreign collective investment schemes;
  • – a 0.075% transfer stamp tax is levied per party if a Swiss security dealer handles the transaction.

For assistance in setting up a SCIAF in Switzerland, please contact our company formation representatives.