China Desk

Switzerland and Greater China

Switzerland was the first continental European country to conclude a free trade agreement with China, and Swiss banks, trading houses and industrial companies have long-standing relationships with partners in mainland China and Hong Kong. For Chinese groups, a Swiss company offers a neutral and respected base for their business in Europe, for trade with Africa and the Middle East, and for holding international investments.

Switzerland does not restrict foreign ownership of most companies, a company can be formed within a few weeks, and dividends can be paid abroad without exchange controls. The double taxation treaties with China and Hong Kong reduce Swiss withholding tax on dividends, which is why the Swiss holding company has long served Asian groups as their European hub.

What Swiss counterparties will ask

Swiss banks review Chinese groups with particular care. Ownership chains through Hong Kong, the British Virgin Islands or the Cayman Islands have to be explained down to the natural persons, and the source of the funds must be documented. State ownership, links to sanctioned entities or trade in dual-use goods lead to further questions.

A group that prepares these answers before it approaches a bank, a notary or a partner moves faster and on better terms. Board resolutions, translated and certified corporate documents and a clear account of the business model are the basis on which a Swiss company is opened, banked and trusted.