Friday, October 4, 2019
The Swiss Federal Council will bring into force legislation on the implementation of recommendations made by the Global Forum on Transparency and Exchange of Information for Tax Purposes.
The OECD's Global Forum conducts peer reviews of member countries in two phases. Phase 1 covers the legal and regulatory framework of the country concerned. Phase 2, to which Switzerland was admitted in 2015, assesses the efficiency of the exchange of information in practice.
In June, legislation was passed to implement the recommendations made by the Global Forum to Switzerland in its phase 2 report.
This legislation will enter into force on November 1, 2019, if a referendum is not called.
Under the legislation, the issue of bearer shares will only be permitted if the company has equity securities listed on a stock exchange or if the shares are structured as intermediated securities. Eighteen months after the legislation's entry into force (May 1, 2021), impermissible bearer shares will be converted into registered shares.
The legislation introduces a new procedure for the identification of shareholders who have not complied with their duty to report to the company and whose shares have been converted. Shares held by non-registered shareholders will become void five years after the entry into force of the Act.
Fines can be imposed on shareholders or companies that fail to report beneficial owners or fail to maintain a share register and list of beneficial owners of shares. The Act requires legal entities headquartered abroad with effective administration in Switzerland to keep a register of owners at the effective place of administration.
The federal government will publish guidance on adhering to the act when it enters into force.