Introduction
Carrying out a capital increase is a crucial step for any Swiss stock corporation (AG). However, with the increase in capital, new shareholders join, changing ownership and control structures. In such cases, the company’s share register must be updated promptly.At the same time, it is essential for the board of directors to reassess the beneficial owners of the shareholders. Furthermore, the board may need to provide the bank with a new declaration of the controlling person of the AG. But what exactly does this mean, and what obligations arise from it?
Table of Contents
- Why is identifying the beneficial owner necessary?
- Obligations of shareholders and the board of directors
- Declaration of the controlling person to the bank
- Digital solutions for declaring the controlling person
- Conclusion
Why is identifying the beneficial owner necessary?
Identifying the beneficial owner after a capital increase is a legal requirement and thus a crucial step for transparency and compliance in an AG. According to the Swiss Code of Obligations (CO), shareholders who, alone or in concert with others,hold at least 25% of the voting rights or share capital of an AG must disclose their beneficial owner to the company (Art. 697j CO). The criterion of “acting in concert” is met, according to Swiss legal practice, in particular when shareholders sign a shareholders’ agreement or are pooled in a syndicate.
Missed or incorrect notifications can have serious consequences: shareholders who do not report their beneficial owner on time temporarily lose their membership and financial rights. In addition, the board of directors is required to monitor compliance with these rules (Art. 697l CO and Art. 697m CO) and may be fined up to CHF 10,000for non-compliance (Art. 327a lit. a Swiss Criminal Code).
Obligations of shareholders and the board of directors
Obligations of shareholders
- Obligation to report within one month of reaching the 25% threshold.
- Provide the beneficial owner’s full name and address.
- Update the information in case of changes.
Obligations of the board of directors
- Review notifications and maintain a register of beneficial owners.
- Ensure that shareholders who fail to comply cannot exercise membership or financial rights.
- Declare the controlling person to the bank.
Declaration of the controlling person to the bank
Banks are required to identify the beneficial owners of their corporate clients. To this end,companies must complete the so-called “Form K,” in which they indicate the controlling person of their AG. This document is part of anti-money laundering measures and ensures that banks correctly record the economic ownership of the assets provided.
By initially signing Form K, the company or its board of directors commits to proactively notifying the bank of any changes regarding the beneficial owner or the controlling person of the AG. If changes result from the reassessment of beneficial ownership after a capital increase, these also affect the controlling person as defined by the banks and must likewise be reported to the company’s bank.
Digital solutions for declaring the controlling person
When updating the share register and when identifying and declaring the beneficial owner and the controlling person, digital management comes into play: modern share register solutions such as Konsento enable efficient documentation and management.
With Konsento’s digital share register platform, the declaration of the beneficial owner can be carried out easily and in full legal compliance. The Konsento share register is free of charge for up to 150 shareholders and provides a user-friendly solution to efficiently handle capital increases and the related reporting obligations.Updated data can be exported as a PDF at the click of a button and shared with the bank.
A particular advantage is Konsento’s digital full-service solution for capital increases: from documenting the capital increase to the final update of the share register, allrelevant steps are handled on one platform. This ensures that all reports are legally compliant and that boards of directors fulfill their obligation to identify the controlling person.
Conclusion
After a capital increase, identifying the controlling person and declaring them again to the bank is an essential duty for stock corporations. Shareholders must disclose their beneficial owner, while the board of directors is responsible for proper implementation. With digital solutions such as Konsento’s share register, these processes can be handled efficiently and in full compliance with the law.
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