Thanks to the free movement of persons, Permit B EU/EFTA for entrepreneurs is sufficient to establish their own businesses in Switzerland. They receive the residence permit if they can prove that they are self-employed. To do so, they must report to their commune of residence within 14 days of their entry and apply for a residence permit. They must submit the following documents:

• A valid identity card or a valid passport
• Documents that confirm that they are or will be engaged in self-employed activity that provides a livelihood for themselves and their family. Eligible documents are: a business identification number (UID number), entry in a trade register, registration for social insurance (Cantonal Insurance Court) as a self-employed person, a business plan or entry in the Commercial Register.

The cantonal migration and labour market authorities issue the residence permit and provide detailed information on the procedure and formalities. In a first step, the residence permit is valid for five years and allows EU/EFTA nationals to be engaged in self-employed activity throughout Switzerland. However, some professions are subject to restrictions. These are listed in the database of the Federation.

The right of residence is lost if the step into self-employment fails and the founder becomes dependent on social assistance. But even then, the foreign nationals concerned are permitted to seek employment in Switzerland.

EU/EFTA nationals with Permit C EU/EFTA can easily set up businesses in Switzerland – just like Swiss nationals. Nationals from the EU-15/EFTA states who have lived here continuously for five years are granted a permanent residence permit C. These are persons from Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and Sweden. Persons from the other EU countries receive this permit only after ten years.

Cross-border commuters from EU/EFTA countries are subject to the same rules as all EU/EFTA citizens. You can set up a business in Switzerland and become self-employed. However, they must return to their main foreign residence at least once a week. The cantonal authorities responsible for the Swiss place of work issue the cross-border commuter permit G EU/EFTA, which is valid for five years.

The Federal Council applied a so-called safeguard clause as of 1 January 2023. It states that Croatian nationals who want to work in Switzerland will need a permit as of that date, which is subject to quotas. This means that only a limited number of permits are issued each year.

Persons with a permanent residence permit for third-country nationals can set up a company in Switzerland without requiring a separate permit. The same applies if they are married to a Swiss citizen or to a person who has a C permit. Nationals of third countries receive the C permit after an uninterrupted stay in Switzerland of five or ten years. The cantonal migration and labour market authorities provide detailed information on the procedure and formalities.

Persons with an S permit must apply for a work permit before establishing a business. Such application must be submitted in the canton of their future place of work. The relevant canton checks whether the financial and operational requirements for the intended activity are met.

Third-country nationals who live in the Swiss border region can set up a business in Switzerland and become self-employed if they have a cross-border commuter permit. They must meet two conditions: They must have an unlimited residence permit in a country neighbouring Switzerland and must have also lived in the external border area for at least six months. In addition, they must return to their main foreign residence at least once a week. The cross-border commuter permit is issued by the cantonal authorities. This G permit is generally initially valid for one year, and only for the border area of the canton that issued the permit.

They are not allowed to set up a company in Switzerland and become self-employed. This is why they must submit an application to the cantonal authorities and prove that their company or business will have a sustained positive effect on the Swiss labour market. What does that mean exactly? They must prove that:

• Their business will diversify the regional economy
• They will create or maintain jobs for local workers
• They will make significant investments in the region
• They will generate business for the Swiss economy

An elaborated business plan is a good starting point for this. In addition, it must be demonstrated that the entrepreneur has sufficient start-up capital and already has organisational links to other enterprises. And finally, the application must include a certificate of incorporation and/or an extract of the entry in the Commercial Register.

If the authority approves the application, the entrepreneur will receive either the L permit or the B permit. Both categories are subject to annual quotas and are therefore only available for a limited period:

• Short-term residence permit for third-country nationals: The L permit is valid for one year and can be extended by no more than a further 12 months.
• Residence permit for third-country nationals: The B permit is valid for one year and can be extended each year – provided the conditions continue to be met.

Important: The work permit does not necessarily give you the right to enter Switzerland. Depending on your nationality, you may also need a visa. You can obtain more information on the web page on ID and visa provisions according to nationality. After arriving from abroad, you must register with the Residents’ Registration Office of your Swiss commune of residence within 14 days. Only then are you allowed to start working.

The sole proprietorship belongs to the founder and is not a legal entity in its own right. It is a popular legal form for small, personal businesses. Foreign nationals who set up a sole proprietorship generally require a residence and work permit in Switzerland. The cantonal migration offices are responsible for this. To check the requirements in your specific case, it is best to contact directly the cantonal authorities. We have summarised the most important advantages and disadvantages of sole proprietorships.

The limited liability company is a legal entity. Therefore, one person must have their place of residence in Switzerland in order to represent the limited liability company, i.e. at least one managing director with a sole signature authorisation or alternatively two managing directors with joint signature authorisation. Accordingly, these persons must have a residence and work permit for Switzerland. The place of residence is irrelevant for all other members of the executive committee. We have summarised the most important advantages and disadvantages of limited liability companies.

When establishing a joint stock company, you must expect relatively high start-up capital and considerable administrative effort compared to a sole proprietorship or a limited liability company. The joint stock company is a legal entity. Therefore, one person must be resident in Switzerland to represent the joint stock company, i.e. at least one member of the board of directors with sole signature authorisation or alternatively two members of the board of directors with joint signature authorisation. Accordingly, these persons must have a residence and work permit for Switzerland. The place of residence of irrelevant for all other members of the board of directors and shareholders.