Notification Obligations under the LETA: What Shareholders, Members and Beneficial Owners Need to Know Now

The Federal Act on the Transparency of Legal Entities and the Identification of Beneficial Owners (LETA) introduces new obligations for Swiss companies that go well beyond the existing framework of the Swiss Code of Obligations (CO). It is no longer only the companies themselves that are required to act — the persons standing behind them are now expressly addressed as well: shareholders of corporations, members of limited liability companies (GmbH), and beneficial owners. Anyone holding equity interests to an extent that enables ultimate control over a subject legal entity will be required to act proactively going forward.

This article explains who is covered by the law in detail, what specific obligations arise, how the notification flows between the persons involved and the company operate, what relief the transitional provisions offer for notifications already made under existing law, and what consequences follow from any breach of these obligations.

Table of Contents

1.    Who Is a Holder of Equity Interests?

2.    The Concept of the Beneficial Owner

3.    Obligations of Holders of Equity Interests

         3.1  Initial notification

         3.2  Duty to cooperate in the event of queries

         3.3  Duty to update

4.    Obligations of Beneficial Owners and Affected Third Parties

5.    Notification Flows between Holders of Equity Interests, Beneficial Owners and the Company

6.    Exemption from the Duty to Re-notify: What Applies to Existing Notifications under the CO?

7.     Legal Consequences and Sanctions for Breach of Obligations

8.    Operational Challenges for Holders of Equity Interests and Beneficial Owners

9.    How Konsento Can Help

10.  Conclusion

1.  Who Is a Holder of Equity Interests?

The LETA uses the term "holders of equity interests" as a collective designation for all persons holding participation rights in a subject legal entity. The law specifically covers the following categories of persons (Art. 13 para. 1 LETA):

• Shareholders of a corporation (Aktiengesellschaft / AG), including participants (Partizipanten)
• Members of a limited liability company (Gesellschaft mit beschränkter Haftung / GmbH)
• Members of a cooperative (Genossenschaft)

What matters is not solely the formal status as a holder of equity interests. The notification obligation applies only to persons who, alone or acting in concert with third parties, hold equity interests in an amount that enables ultimate control over the company (Art. 13 para. 1 LETA). The key threshold is a holding of more than 25 percent of the capital or voting rights, corresponding to the definition of beneficial owner in Art. 4 LETA.

A shareholder holding 30 percent of the shares in a corporation is therefore directly and immediately subject to the notification obligation. The same applies to a GmbH member holding a corresponding quota share. Where several persons hold their interests on the basis of a coordinated exercise of voting rights — for example through a shareholders' agreement or an informal arrangement — even persons holding a smaller individual stake may collectively reach the control threshold as a group and thus become subject to the notification obligation.

2.  The Concept of the Beneficial Owner

Under the LETA, the beneficial owner is any natural person who ultimately controls a company by holding at least 25 percent of the capital or voting rights, or who otherwise exercises effective control over it (Art. 4 para. 1 LETA). This definition corresponds to that used in the Anti-Money Laundering Act (AMLA). Indirect control through a chain of control — for example where a natural person controls a holding company which in turn holds an interest in the target company — is treated in the same way as direct control through a participation. Since the concept of the beneficial owner is addressed in detail in a separate blog article, this section is limited to the key points necessary to understand the obligations described below.

3.  Obligations of Holders of Equity Interests

3.1  Initial notification

Holders of equity interests who are subject to the notification obligation must notify the company of the beneficial owner. This notification must be made within one month of the acquisition of control (Art. 13 para. 3 LETA). It must include the following information concerning the beneficial owner (Art. 13 para. 1 LETA):

• Last name and first name
• Date of birth
• Nationality or nationalities
• Address and country of domicile
• Information on the nature and extent of the control exercised

The notification obligation is triggered only by reaching or exceeding certain thresholds — 25, 50, 75 or 100 percent — and not by every change in the number of shares or interests held. A person who increases their holding from 28 to 32 percent without crossing a further threshold is not required to make a new notification. Only a crossing of the next threshold triggers the obligation.

A simplified regime applies to shareholders or members that are themselves legal entities and whose participation rights are partially listed on a stock exchange: they need only disclose that fact, together with their company name, registered office, and listing details (Art. 13 para. 2 LETA).

3.2  Duty to cooperate in the event of queries

If the company requests additional information or supporting documents in order to verify the identity of the notified person or that person's status as beneficial owner, the holders of equity interests are obliged to cooperate (Art. 13 para. 4 LETA). They must supply the documents requested. This is not a mere procedural obligation but a binding duty under public law.

3.3  Duty to update

If any of the notified details change — for example because the beneficial owner changes their place of domicile, acquires a new nationality, or because the holding crosses or falls below a threshold — the person subject to the notification obligation must inform the company within one month of becoming aware of the change (Art. 13 para. 5 LETA). This ensures that the company is at all times in a position to fulfil its own notification obligation vis-a-vis the transparency register.

4.  Obligations of Beneficial Owners and Affected Third Parties

The LETA does not limit obligations to the formally registered holders of equity interests. Art. 14 LETA establishes independent notification and cooperation obligations for beneficial owners themselves as well as for third parties forming part of a chain of control — such as indirect shareholders or trustees. Anyone who controls a company through a multi-level structure without being a formal holder of equity interests must, upon request by the subject company, supply the required information and cooperate in the verification process.

The duty to cooperate applies in particular where the company needs the information in order to fulfil its own identification and notification obligations vis-a-vis the transparency register. The chain of control encompasses the entirety of the legal and factual relationships through which the beneficial owner exercises effective control over the company. An estate community jointly holding shares in a company falls within the scope just as much as an informally coordinated group of shareholders operating without a formal shareholders' agreement.

5.  Notification Flows between Holders of Equity Interests, Beneficial Owners and the Company

The LETA provides for a tiered flow of information that begins with the beneficial owner and ends with the federal transparency register. It can be broken down into three sequential steps:

• The beneficial owner informs the holders of equity interests of their identity and the relevant details required for the notification. This is particularly significant where the holder of equity interests is itself a legal entity and the natural person ultimately exercising control is not readily identifiable. Art. 14 LETA establishes an independent duty to cooperate for the beneficial owner and for other third parties forming part of a chain of control: anyone who actually exercises ultimate control must proactively make available the information required, so that the holder of equity interests subject to the notification obligation can actually fulfil their duty at all.
• The holders of equity interests notify the company of the beneficial owner together with the required details, within one month of the acquisition of control (Art. 13 para. 3 LETA). The company may request supporting documents and is obliged to exercise this right where the information provided is incomplete or implausible (Art. 13 para. 4 LETA).
• The company verifies the information received with the due diligence required in the circumstances, documents it internally, and subsequently notifies the federal transparency register (Art. 9 LETA). Responsibility for this notification rests with the most senior member of the governing body — in practice the chairman of the board of directors or the managing director of the GmbH (Art. 12 para. 1 LETA). This task may be delegated, but responsibility remains with the senior governing body.

The first step — the transmission of information from the beneficial owner to the holder of equity interests — is frequently underestimated in practice. Yet it is the prerequisite for everything that follows: without complete and accurate information from the beneficial owner, the holder of equity interests cannot properly discharge their notification obligation vis-a-vis the company at all. A beneficial owner who remains passive not only jeopardises their own legal position but also places the holder of equity interests subject to the notification obligation in a difficult situation.

If the company is nonetheless unable to identify a beneficial owner or to verify the information received, it must enter in the transparency register the relevant information available to it together with the details of the most senior member of its governing body as a contact person. In doing so, the names of holders of equity interests who have failed to fulfil their notification obligation vis-a-vis the company will also be recorded — an effective incentive for cooperation at every level of the chain.

6.  Exemption from the Duty to Re-notify: What Applies to Existing Notifications under the CO?

Many shareholders and members have already acted under the existing law and notified the company of the beneficial owner pursuant to Art. 697j CO (for corporations) or Art. 790a CO (for GmbHs). The LETA recognises these existing notifications: anyone who has fully complied with their obligations under these CO provisions is deemed to be exempt from the notification obligation under Art. 13 para. 1 LETA — provided that the person notified is also the beneficial owner of the company under the new law (Art. 49 para. 1 LETA).

However, this exemption does not apply automatically and without reservation. The LETA places more extensive substantive requirements on the notification than did the CO. The new law requires additional identification details, namely:

• Date of birth of the beneficial owner
• Nationality or nationalities
• Details on the nature and extent of the control exercised

If these details are not contained in the existing CO notification, the company may require the missing information to be supplied within one month (Art. 49 para. 2 LETA). If a person other than the one who qualifies as beneficial owner under the new definition in the LETA was notified under the CO, a completely new notification is required. It is therefore advisable to review existing CO notifications promptly for completeness and conformity with the new requirements — before the entry into force of the LETA places the situation under a sharper spotlight.

7.  Legal Consequences and Sanctions for Breach of Obligations

The LETA provides for significant sanctions. Anyone who wilfully breaches the notification obligation under Art. 13 or Art. 14 LETA is liable to a fine of up to CHF 500,000 (Art. 43 lit. a LETA). Anyone who knowingly fails to comply with a legally binding order of the supervisory authority, which is affiliated with the Federal Department of Finance, risks an additional fine of up to CHF 100,000 (Art. 44 LETA). These sanctions apply not only to the company and its governing bodies but also to holders of equity interests and beneficial owners who fail to fulfil their notification and disclosure obligations or who provide false information. The Federal Department of Finance is the prosecuting and adjudicating authority. Since the Federal Act on Administrative Criminal Law (ACLA) applies, Art. 6 para. 1 ACLA governs the determination of the liable natural person. A separate blog article will address the sanctions regime under the LETA in detail.

8.  Operational Challenges for Holders of Equity Interests and Beneficial Owners

What appears manageable on paper is a genuine challenge in practice. Most shareholders and GmbH members are not aware that the LETA places a personal legal obligation on them that is independent of the company. The notification must be initiated proactively — nobody actively reminds the person subject to the obligation. And where interests are held through holding companies or intermediate entities, the question of who is subject to the notification obligation and what information must be provided is anything but straightforward.

In addition, there is the ongoing duty to update. Each of the following events triggers a new notification obligation to the company within one month:

• Change of address or name of the beneficial owner
• Change of nationality
• Transaction that causes a relevant threshold (25%, 50%, 75% or 100%) to be crossed or fallen below

Anyone who has not established structured processes to capture such changes and pass them on in good time risks missing deadlines without realising it. For companies on the receiving end of notifications, there is a mirror-image challenge: they must carefully review, document, and forward the incoming information to the transparency register within the prescribed time limits. This is only achievable with a structured process and a reliable instrument for managing shareholder data.

9.  How Konsento Can Help

Konsento is designed precisely for this core task. Konsento's digital share register is built from the outset to capture in a structured manner all the information that the LETA requires in relation to beneficial owners — from identity and nationality through to the nature and extent of control. As soon as a notification is received from a shareholder or member, it can be recorded directly and comprehensively in the platform and assigned to the relevant holding.

Because Konsento documents changes in shareholdings in an audit-proof manner and makes threshold crossings traceable, it automatically creates a basis for the ongoing assessment of whether a new notification obligation has been triggered. The company is at all times in a position to assess whether the information held in the share register is complete and up to date — and whether a new notification to the transparency register is required. This significantly reduces the burden on the responsible person within the governing body. Konsento's digital share register is available free of charge for companies with up to 150 shareholders.

10.  Conclusion

The LETA tightens the existing notification obligation for holders of equity interests vis-a-vis their company — and, through the company, indirectly vis-a-vis the state transparency register. Anyone holding more than 25 percent of the capital or voting rights in a subject company bears a personal legal obligation that must be fulfilled proactively, completely, and within the prescribed time limits. Existing CO notifications are recognised under certain conditions but do not release the person from the obligation to supply missing details or, where there are discrepancies, to make a new notification. Anyone who fails to take these obligations seriously is exposed to significant criminal risk.

Being prepared early pays off

The LETA is expected to enter into force in autumn 2025. Depending on the legal form of the entity, transitional periods range from three months to two years — meaning the time available to clarify the situation is shorter than it may appear at first glance.

If you act as a board member, managing director, or other responsible person within a company's governing body, it is worth getting your share register in good order now: anyone who has properly documented their ownership structure and fully recorded the relevant details on beneficial owners will be able to fulfil the new notification obligations vis-a-vis the transparency register without significant additional effort. Use Konsento's free share register function and get the clear overview you need right now.

And if you yourself hold an interest as a shareholder, GmbH member or beneficial owner in a company subject to the LETA: you bear a personal notification obligation — regardless of whether the company itself has everything under control. The best way to ensure that your notification reaches the company on time and in full is for the company to maintain its shareholder data in a structured way. Recommend that the company use Konsento — it is just as much in your interest as it is in theirs.