Stock corporation law reform - After the marathon into the additional round
The starting signal for the reform of company law was given an incredible 27 years ago. After a number of bifurcations, aberrations and detours, the Swiss parliament was finally able to pass a balanced and modernized law on 19 June 2020. Unfortunately, anyone wishing to implement the changes immediately will have to be patient for a while yet: The amendments to the law will probably not come into force before January 1, 2023 due to the necessary implementing provisions.
While the area of accounting and auditing had already been made independent in earlier stages, various social demands and initiative requests that had arisen in the meantime, such as the Minder Initiative ("rip-off artist initiative"), gender equality and commodity transparency, were incorporated into the bill during the legislative process. For political reasons, the latter two points were the only ones to be brought forward with partial enactments.
The revision of company law supplements or amends the existing law, i.e. a large part of the current provisions will remain in force in the future.
Separate provisions for large
Company law must cover a broad spectrum of companies and organizational forms, from the smallest one-man company to large multinationals such as Nestlé. In order to allow for differentiation, individual provisions explicitly only apply to listed companies.
Examples:
Gender benchmarks for the Board of Directors and Executive Board
Supplemented/amended provisions on the remuneration of governing bodies (replacement of VegüV)
Disclosure obligations for commodity companies
New regulations on proxy voting
Is there also something for SMEs?
The majority of the remaining changes apply in principle to all public limited companies. Nevertheless, some of them will hardly ever be relevant in small, manageable circumstances, such as holding the general meeting at several venues.
The most important changes that should also be of interest to SMEs:
Introduction of a capital band: The AGM can authorize the Board of Directors to increase or reduce the share capital within 5 years
Share capital can now be paid up and managed in foreign currency
Interim dividends are now officially permitted
Strengthening of shareholder rights in various points
The Articles of Association may now provide for the holding of a virtual or written AGM
In the event of imminent insolvency, the Board of Directors must take measures to restore solvency and, if necessary, take additional restructuring measures.
If half of the capital is lost, an AGM no longer has to be convened, but the Board of Directors must decide on restructuring measures
In the event of over-indebtedness, the court may not be notified if there is a short-term prospect of restructuring.
In return, the law no longer provides for a stay of bankruptcy
This list is not exhaustive and the selection is somewhat subjective.
In an upcoming newsletter, we will go into more detail about the new features, with a focus on SMEs.
What next?
Only some of the changes will come into force directly by law. As a rule, the articles of association will need to be amended in order to make use of the various options. If you want to be involved right from the start, you should initiate the amendment of the articles of association in good time. On the other hand, amendments to the articles of association may not even contain the provisions of the new law before it comes into force. It is therefore advisable to implement only the mandatory amendments to the articles of association during this period and to wait with any amendments and new provisions until the new company law can also be integrated. However, this will probably cause a major backlog at the commercial register offices. Patience will therefore also be required in the future!
