5 June 2025
Since 1 January 2025, attention is required. Failure to adapt the articles of association may lead to legal risks and uncertainty.
The most recent revision of Swiss company law has brought significant modernisation, aligning the legal framework more closely with practical business needs. Companies limited by shares (LTD) and limited liability companies (LLC) that existed prior to 1 January 2023 were granted a transitional period until 31 December 2024 to bring their articles of association into compliance with the new legal requirements.
Where certain provisions of the articles of association are no longer compatible with the revised law, they will automatically cease to be valid from 1 January 2025 by operation of law. For shareholders, this means that from that date onward, they can no longer rely on the existing content of the articles of association. At the same time, this poses a risk for the affected companies that certain provisions lost their legal effect or resulted in unintended changes from 1 January 2025 – changes which could have been avoided. Either way, this leads to legal uncertainty.
One illustrative example of this is the delegation of executive management. Under the revised law, the board of directors may delegate executive management duties to individual members or third parties unless the articles of association explicitly provide otherwise. Under the previous law, such delegation was only permitted if the articles of association explicitly authorised the board of directors to do so. In practical terms, this means the following: if the board of directors is not to be permitted to delegate executive management, it was sufficient until 31 December 2024 that the articles of association did not contain an explicit authorisation for such delegation. However, from 1 January 2025 onwards, any prohibition on delegation must be expressly set out in the articles of association in order to be effective.
This example clearly demonstrates how a failure to update the articles of association may fundamentally alter a company’s structure and governance. Given this, and in view of numerous other amendments introduced by the revised company law, we recommend a thorough review of your current articles of association for compliance. The same applies to related corporate documents, such as organisational regulations.
A full review of the articles of association and related corporate documents also presents an opportunity to explore how your company might benefit from the new possibilities and modernisations introduced by the revised company law. The revised company law offers a range of options for making corporate governance more straightforward, flexible, and digital. For instance, general meetings can be held virtually or abroad. There is also the option to define the share capital within a so-called capital band or to include arbitration clauses in the articles of association.
To avoid unpleasant surprises, we recommend reviewing your articles of association for compatibility with the revised company law.
