Changing the share capital of a Swiss company — whether increasing it to fund growth or decreasing it to return surplus capital — requires a formal procedure under the Code of Obligations. The 2023 corporate law reform introduced the capital band (Kapitalband), giving AG boards more flexibility to adjust capital without repeated shareholder votes. For an overview of how capital structures differ across company types, see our guide to Swiss business structures.
When would you change share capital?
| Reason | Direction | Typical Scenario |
|---|---|---|
| Fund new investment or expansion | Increase | Company needs CHF 500,000 for a new product line |
| Admit a new shareholder or investor | Increase | Investor subscribes to new shares at a premium |
| Employee stock option plan | Increase (conditional) | Options vest and employees exercise their right to shares |
| Convertible loan conversion | Increase (conditional) | Lender converts debt into equity |
| Return surplus capital to shareholders | Decrease | Company has excess cash and no use for the capital |
| Offset accumulated losses | Decrease | Losses exceed reserves; capital is reduced to restore a clean balance sheet |
| Restructuring (accordion) | Decrease + increase | Capital reduced to zero and simultaneously re-increased with fresh funds |
How does an ordinary capital increase work?
An ordinary capital increase (ordentliche Kapitalerhöhung) is the standard method. New shares (AG) or new Stammanteile (GmbH) are created and subscribed by existing shareholders or new investors.
Step 1 — General meeting resolution. The shareholders pass a resolution to increase the share capital. Required majority:
- AG: simple majority of votes represented (unless articles require more)
- GmbH: two-thirds of votes represented AND an absolute majority of the total capital represented (OR Art. 808b)
The resolution must specify: the amount of the increase, the number and nominal value of new shares, the issue price, the type of contribution (cash or in kind), and any restrictions on pre-emptive rights.
Step 2 — Subscription and payment. New shares are offered first to existing shareholders (pre-emptive right, Bezugsrecht, OR Art. 652b). Shareholders who do not exercise their right within the set period (typically 14-30 days) lose it. The capital contribution must be:
- Cash contributions: paid into a blocked account (Sperrkonto / Kapitaleinzahlungskonto) at a Swiss bank. The bank issues a confirmation (Kapitaleinzahlungsbestätigung).
- Contributions in kind (Sacheinlagen): independently valued and confirmed by a licensed auditor in a capital increase report (Kapitalerhöhungsbericht).
Step 3 — Notarisation. The notary authenticates the amended articles of association reflecting the new capital amount, the shareholder resolution, and the board’s declaration that all contributions have been made.
Step 4 — Commercial register filing. The board files the amendment with the cantonal commercial register within three months of the shareholder resolution (six months if the increase has multiple tranches). Required documents:
- Authenticated shareholder resolution and amended articles
- Board declaration (Feststellungserklarung) confirming full payment
- Bank confirmation (cash) or auditor report (in kind)
- Updated shareholder list (GmbH)
Step 5 — Registration. The register office reviews the filing (one to two weeks) and publishes the amendment in the Swiss Official Gazette of Commerce (SOGC/SHAB). The increase is legally effective from the date of registration.
What is authorised capital?
Note: Since the 2023 reform, the classic authorised capital (genehmigtes Kapital) has been replaced by the capital band for AGs. Companies that had authorised capital before 1 January 2023 could continue using it until it expired. New authorisations must use the capital band.
For GmbHs, authorised capital was never available — the capital band is also not available for GmbHs. A GmbH must use the ordinary capital increase procedure for every change.
What is conditional capital?
Conditional capital (bedingtes Kapital, OR Art. 653-653i) reserves a specific number of shares for future issuance when a triggering event occurs. The shares are not issued immediately — they are created automatically when the right is exercised.
Common uses:
- Employee stock option plans (ESOP): employees exercise vested options and receive shares
- Convertible bonds: bondholders convert their debt into equity
- Warrant bonds: warrant holders exercise the right to buy shares
Limits: Conditional capital may not exceed 50% of the existing share capital (OR Art. 653(2)).
Process:
- General meeting approves the conditional capital (two-thirds majority for AG)
- Articles are amended to specify the maximum conditional amount, the beneficiaries, and the conditions for exercise
- When rights are exercised, the board registers the actual increase with the commercial register
- Existing shareholders have no pre-emptive right on conditional capital (the purpose is to serve the specific beneficiaries)
Practical note: For small private companies, conditional capital is rarely used. It becomes relevant when the company has more than a handful of employees receiving equity compensation or when raising debt with conversion features.
What is the capital band?
The capital band (Kapitalband, OR Art. 653s-653v) is the most significant innovation of the 2023 corporate law reform for capital management. It is available only for AGs (not GmbHs).
How it works:
The general meeting authorises the board to increase or decrease the share capital within a defined range:
- Upper limit: up to 50% above the current share capital
- Lower limit: up to 50% below the current share capital (but never below the legal minimum of CHF 100,000)
- Duration: maximum five years from the shareholder resolution
Example: An AG has share capital of CHF 200,000. The general meeting approves a capital band of CHF 100,000 to CHF 300,000 for five years. The board can now:
- Issue new shares up to CHF 300,000 total without a new general meeting
- Reduce capital down to CHF 100,000 without a new general meeting
- Make multiple adjustments within the band during the five-year period
Requirements for board action within the band:
- Increases: the board must ensure contributions are fully paid, file with the register, and respect any pre-emptive rights (unless the general meeting authorised their exclusion)
- Decreases: a licensed auditor must confirm that creditors’ claims are fully covered after the decrease. The creditor call procedure (two-month publication in the SOGC) applies
Key advantage: Speed. An ordinary capital increase requires a general meeting (4-8 weeks of notice and preparation). With a capital band, the board can act within days — critical for time-sensitive investments or funding rounds.
How does a capital decrease work?
A capital decrease (Kapitalherabsetzung) reduces the company’s registered share capital. This is subject to creditor protection rules because the capital serves as a liability buffer.
Step 1 — General meeting resolution. Same majority requirements as a capital increase. The resolution specifies the new capital amount and how the decrease is implemented (cancellation of shares, reduction of nominal value, or repayment to shareholders).
Step 2 — Auditor confirmation. A licensed auditor must confirm that creditors’ claims remain fully covered after the decrease (OR Art. 732(2)).
Step 3 — Creditor call. The company must publish a notice in the SOGC three times, calling on creditors to file their claims within two months (OR Art. 733). Creditors who come forward must be satisfied or secured before the decrease can proceed.
Step 4 — Notarisation and registration. After the two-month creditor period expires and all claims are settled, the notary authenticates the amended articles. The board files with the commercial register.
Timeline: Minimum four months from resolution to registration (due to the two-month creditor call plus processing time).
Exception — simultaneous decrease and increase (accordion): If the capital is decreased and simultaneously re-increased to at least the previous amount, the creditor call can be waived (OR Art. 735). This is commonly used in restructurings where the company needs to write off accumulated losses and then inject fresh capital.
What are the GmbH-specific rules?
GmbH capital changes follow the same principles but with key differences:
| Aspect | AG | GmbH |
|---|---|---|
| Minimum capital | CHF 100,000 (20% paid in, min CHF 50,000) | CHF 20,000 (fully paid in) |
| Capital band | Available (since 2023) | Not available |
| Authorised/conditional capital | Conditional capital available | Neither available |
| Required majority for increase | Simple majority (unless articles say otherwise) | Two-thirds of votes + absolute majority of capital |
| Transfer restriction after increase | Depends on share type | Notarised transfer required for new Stammanteile |
| Shareholder list | Not in register (AG) | Updated in register (GmbH) |
| Minimum nominal value per unit | CHF 0.01 per share | CHF 100 per Stammanteil |
GmbH increase process: Identical to the AG ordinary increase, but the shareholder resolution requires a qualified majority and the notary must also record the updated shareholder list. New Stammanteile are registered with the commercial register showing each shareholder’s holding.
GmbH decrease process: Same creditor protection steps as AG. The minimum capital of CHF 20,000 must be maintained. Each Stammanteil must retain a nominal value of at least CHF 100 after the decrease.
What does it cost?
| Cost Item | Typical Range |
|---|---|
| Notary fee (articles amendment) | CHF 1,000–3,000 |
| Commercial register fee | CHF 600–1,200 |
| Bank capital confirmation | CHF 200–500 |
| Auditor report (contributions in kind) | CHF 2,000–5,000 |
| Auditor confirmation (capital decrease) | CHF 1,500–3,000 |
| Federal stamp duty (Emissionsabgabe) | 1% on new equity above CHF 1 million |
| Legal/fiduciary advisory | CHF 1,000–5,000 |
| SOGC publication (creditor call, 3×) | CHF 300–600 |
Total for a simple cash increase (small GmbH): CHF 1,500–3,000. Total for a capital decrease with creditor call: CHF 3,000–8,000. Total for a complex restructuring with in-kind contributions: CHF 5,000–15,000+.
Why you can trust this guide
This guide is written by Florian Rosenberg, a former fiduciary office manager who has managed capital increases and restructurings for Swiss AGs and GmbHs. Legal references cite OR Art. 650-653i (capital increases), OR Art. 732-735 (capital decreases), and OR Art. 653s-653v (capital band). Verify any point against the primary source.
Frequently asked questions
How much does a capital increase cost in Switzerland?
The main costs are the notary fee for amending the articles of association (CHF 1,000-3,000 depending on the canton and transaction size), the commercial register fee (CHF 600-1,200), and the federal stamp duty (Emissionsabgabe) of 1% on new equity exceeding CHF 1 million. For a small GmbH increasing capital from CHF 20,000 to CHF 50,000, the total cost is typically CHF 1,500-3,000. No stamp duty applies because the new equity is below the CHF 1 million threshold.
How long does a capital increase take?
From the shareholder resolution to the updated commercial register entry: approximately three to six weeks. The general meeting passes the resolution (or uses circular resolution for small companies), the notary authenticates the amended articles, the capital is paid in (verified by bank confirmation or auditor report for contributions in kind), and the commercial register processes the filing. The register office typically takes one to two weeks after receiving a complete filing.
Is a notary required for a capital increase?
Yes. Any amendment to the articles of association — including a capital change — requires notarisation (öffentliche Beurkundung). The notary authenticates the shareholder resolution and the amended articles. This applies to both AG and GmbH. The notary must be licensed in the canton where the company has its registered office.
What is the difference between authorised capital and conditional capital?
Authorised capital (genehmigtes Kapital) allows the board to issue new shares within a set amount and timeframe (maximum five years since 2023) without calling a new general meeting. Conditional capital (bedingtes Kapital) reserves shares for specific purposes — typically employee stock option plans or convertible bonds — that are issued automatically when option holders or bondholders exercise their rights. Both are limited to 50% of the existing share capital.
What is the capital band (Kapitalband) introduced in 2023?
The capital band is a new instrument under OR Art. 653s-653v that allows the general meeting to authorise the board to increase or decrease the share capital within a defined range — up to 50% above and 50% below the current capital — for a maximum of five years. The board can adjust capital within this band without a new shareholder vote, provided it follows the procedural requirements (auditor confirmation for decreases, payment verification for increases). The capital band replaces the old authorised capital mechanism but can coexist with conditional capital.
Can you increase GmbH capital without new shareholders?
Yes. Existing shareholders can subscribe to the new capital contributions (Stammanteile) in proportion to their existing holdings. Each existing shareholder has a pre-emptive right (Bezugsrecht) by default. If all new Stammanteile are taken up by existing shareholders, no new shareholders are added. The process requires a shareholder resolution (two-thirds majority), notarised amendment of the articles, payment of the new capital, and filing with the commercial register.
Is stamp duty payable on a capital increase?
The federal issuance stamp duty (Emissionsabgabe) of 1% applies to new equity (share capital plus any premium/agio) exceeding a cumulative lifetime threshold of CHF 1 million. For most small and mid-size companies, the first CHF 1 million of equity is exempt. Example: if a company has CHF 100,000 in share capital and increases by CHF 200,000 (total CHF 300,000), no stamp duty is owed. If a company raises total equity above CHF 1 million, the 1% duty applies only to the amount exceeding CHF 1 million.
Can you decrease share capital below the legal minimum?
No. The share capital after a decrease must remain at or above the legal minimum: CHF 100,000 for an AG and CHF 20,000 for a GmbH. A decrease to zero is only possible as part of a restructuring where the capital is simultaneously re-increased (Herabsetzung und gleichzeitige Wiedererhöhung, also called an accordion or concertina). This is used when the company has accumulated losses exceeding its equity and needs to reset.