Practitioner's note: issuing tokenised shares in a Zug company

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A Zug company that wishes to issue its shares as ledger-based securities should consider the following points. The articles of association must provide for the issue of shares as ledger-based securities and must refer to the registration agreement, an amendment that the general assembly must adopt. The company must choose a ledger that meets the requirements of Article 973d of the Code of Obligations and document its functioning. Most companies use a public blockchain together with a smart contract provided by a specialised platform. The company must also keep a share register and a register of beneficial owners as required by company law. The ledger can serve as the share register only if it contains the required information or if the company links it to a separate record.

The transfer of registered shares is often restricted by the articles. A company that wishes to restrict transfers must implement the restriction in the smart contract, for example by requiring the company's approval of each transfer. Because holders of ledger-based securities have the same rights as other shareholders, the company must provide for the exercise of voting rights and the payment of dividends, including the deduction of withholding tax. The company should inform its shareholders about the functioning of the ledger and the risks of losing access to their tokens, since its liability under Article 973i depends on the quality of that information. Finally, the company should consider whether the offer of its shares triggers the prospectus requirement of the Financial Services Act, although in most cases the exemptions for small offers or offers to a limited number of investors will apply.

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.

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Dr Alexander Ressos, TEP

Rechtsanwalt/Attorney-at-Law

I am a Swiss attorney-at-law and also admitted as a solicitor in Hong Kong and in England & Wales, with almost 25 years of experience.

Together with my multilingual team, including Chinese, Japanese, Korean, Russian, Ukrainian and French native speakers, I advise companies and their owners from around the world on the full range of banking, corporate, commercial and tax law matters in Switzerland, including international tax planning, fiduciary services, and legal family office services including immigration & relocation or real estate investments. My practice has a particular focus on clients from growth and frontier markets in Greater China, Central Asia and the Caucasus, the rest of Asia, the Middle East, Africa and Latin America, and I equally advise clients from Europe and North America. Through an affiliated Swiss trust company, we also take care of the incorporation and ongoing administration of their companies and other structures, including accounting, tax returns and corporate secretarial services, and I serve as a professional director where required. With the support of a network of first-class cooperation partners, I also implement solutions worldwide.

My approach is to act as a trusted advisor who works directly with decision-makers, on an equal footing: I start from what you want to achieve and shape every structure, contract and tax decision around your commercial goals and how it improves your after-tax return. As “lawyers who make it happen”, my team and I stay involved until your company is set up, your structure is in place and your transaction has closed, and we remain available for any follow-on work that may be required. You benefit from bespoke solutions and personal attention, and sound, friendly and practical advice. We are not the lowest-cost provider in the market, nor do we intend to be; our aim is to deliver well-founded, proper solutions and excellent value for money.

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Practitioner's note: issuing tokenised shares in a Zug company

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