The Karpeo guide · Business formation
Cooperative society in Switzerland: formation, capital and governance
A Swiss cooperative brings people or businesses together around a shared economic interest or a public-interest purpose. It can trade, employ staff and earn a profit. Its distinguishing feature is member participation, rather than control in proportion to invested capital. Here is what to consider before forming one.
By Romain Prieur · Swiss certified accountant
Key takeaways
- A Swiss cooperative normally needs at least seven founding members, who may be individuals or legal entities.
- There is no fixed statutory minimum capital, but the project still needs sufficient funding.
- The basic governance principle is one member, one vote.
- The cooperative form does not automatically make the organisation tax-exempt or remove accounting obligations.
What is a Swiss cooperative?
A cooperative society is a legal form governed by the Swiss Code of Obligations. In French it is a société coopérative; in German, a Genossenschaft. It is designed for members pursuing common interests through joint action, or for a qualifying public-interest purpose.
Typical projects include shared premises, purchasing, housing, energy production or marketing services for members. The essential question is what the members will do together and how the cooperative will meet their needs.
A cooperative may run a commercial business and generate a surplus. It is not automatically an association, a charity or a tax-exempt organisation. Choosing the name “cooperative” does not by itself define the tax treatment of its activity.
Founders and membership
At least seven members are required to establish a cooperative. They can be natural persons or legal entities. The structure is intended for a membership that can evolve, subject to the law and the objective admission and withdrawal conditions in the articles of association.
Set out who can join, what participation means, what members must contribute and how they may leave. A shared mission is not enough if expectations about access, prices, work or financial commitments differ.
Membership does not automatically create an employment relationship. A person can be a member, an employee, a customer or several of these at once. Keep the rights and obligations arising from each relationship distinct.
Capital and startup funding
A cooperative has no fixed share capital and no statutory minimum incorporation capital. The articles may provide for cooperative shares; where share capital exists, members subscribe in accordance with the relevant requirements. The absence of a legal minimum is not evidence that the project can operate without cash.
| Funding item | Example for a shared workshop |
|---|---|
| Initial member contributions | 8 members × CHF 1,000 = CHF 8,000 |
| Equipment, fit-out and startup cash required | CHF 45,000 |
| Remaining funding gap | CHF 37,000 |
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In this example, the founders need to explain how they will finance the CHF 37,000 gap. Member loans, external borrowing or other confirmed funding have different repayment, governance and accounting implications. An anticipated subsidy should not be treated as cash already secured.
Build a budget around the services members will actually buy or use. Specify recurring charges, maintenance, insurance and reserves for replacing shared assets. Cheap member pricing is only sustainable if it covers the economic model.
Member liability and commitments
As a general rule, the cooperative answers for its debts with its own assets. However, the articles may provide for personal member liability or additional contribution obligations within the legal framework. Read the actual clauses before joining or founding a cooperative.
Limited statutory liability does not cancel a separate personal guarantee given to a bank or landlord. Nor does it remove potential liability for breaches of management duties. A departing member should also check the rules governing remaining commitments and any continuing exposure.
Make financial obligations understandable. Members should know whether their risk is limited to paid contributions, whether further payments can be required and how a withdrawal affects their share or claims.
Governance: one member, one vote
| Body | Role | Main point to organise |
|---|---|---|
| General meeting | Member decisions and oversight | One member, one vote as the basic principle |
| Board / administration | Management and representation | At least three members; statutory composition requirements apply |
| Auditor, where required | Independent audit or review of accounts | Assess the audit regime and whether a lawful opting-out is possible |
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The board must have at least three members. The majority must be cooperative members, with the statutory rules allowing representatives of member legal entities. Appoint people who can oversee finance, operations and the interests of the membership.
Voting is not normally weighted by the number of shares held. This makes a cooperative attractive for shared use and democratic participation, but less suited to investors expecting control proportionate to their capital.
An audit opting-out is not automatic because the cooperative is small. The applicable conditions include, for a limited-audit waiver, no more than ten full-time equivalent positions on annual average and unanimous consent, together with the other legal requirements. Member protection rights and any obligation to have an ordinary audit must also be considered.
How to form the cooperative
Define the common purpose, founding membership, financial plan and governance before preparing the articles. The name, registered office, purpose, member obligations, communication rules and organisation must be coherent.
Since 1 January 2023, the incorporation resolution requires a public deed. The notarial and commercial register requirements should therefore be included in your schedule and budget. The cooperative acquires legal personality through entry in the commercial register.
- Agree the project, services and startup budget.
- Prepare the articles and membership rules.
- Choose the board, signatories and audit arrangements.
- Complete the notarial incorporation and commercial register filing.
- Open or finalise banking arrangements and establish a member register.
- Set up accounting, invoicing, insurance and employer registrations where relevant.
If the project is mainly a business run by two founders, compare an LLC or another suitable form before trying to fit it into a seven-member cooperative. Our Swiss business formation guide provides a broader starting point.
Accounting and tax obligations
A cooperative keeps accounts under the Swiss Code of Obligations. Record member shares, loans, membership dues, sales and grants according to their actual nature. A contribution to equity is not treated like a fee for a service, and a member loan remains a financing transaction.
Cooperatives are generally subject to corporate income tax and cantonal and communal capital tax. Reinvesting a surplus does not automatically exempt it. A public-interest tax exemption requires the relevant conditions and recognition; serving members’ economic interests is not by itself sufficient.
VAT depends on activities and the applicable liability rules, rather than the cooperative label. Review taxable supplies, exemptions, thresholds and input-tax recovery. Read our Swiss VAT guide and corporate tax guide to distinguish these obligations.
If the cooperative employs staff, it must address payroll and social insurance obligations like other employers. Member status does not replace that assessment.
When is a cooperative a good fit?
| Potentially suitable | Consider another form when… |
|---|---|
| Members share equipment, premises or purchasing | The main objective is proportional investor control |
| The project benefits from participation and open membership | Decision-making must remain with a small fixed founder group |
| Members accept democratic governance and long-term funding responsibilities | The only motivation is avoiding minimum capital or tax |
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The articles should support the way the project will actually operate. Think through admission, withdrawal, financial pressure and disagreements while relationships are good. That preparation is more valuable than choosing the form simply because it sounds collaborative.
Frequently asked questions
Can two people form a Swiss cooperative?
No. At least seven founding members are required. If the project only has two founders, assess another legal form.
Is minimum capital required?
There is no fixed statutory minimum capital for a cooperative. A realistic financing plan remains necessary to cover setup, operations and commitments.
Does incorporation require a notary?
Yes. Since 1 January 2023, the incorporation resolution must be recorded in a public deed. Commercial register entry is also required.
Can a cooperative distribute profits?
Distribution is not automatic. The articles must permit it and the legal rules, reserves and other applicable conditions must be respected. Otherwise the surplus generally strengthens the cooperative’s assets.
Are members personally liable?
The cooperative normally answers with its assets, but the articles can introduce member liability or additional payment obligations. Separate personal guarantees and management liability must also be considered.
Does a cooperative pay less tax?
There is no automatic exemption just because the organisation is a cooperative. Tax treatment follows the relevant rules, activity and any formally recognised exemption.
Sources and further reading
About the author
Romain Prieur
Romain Prieur is a Swiss certified accountant and founder of Karpeo. He supports SMEs, self-employed professionals and entrepreneurs with accounting, tax and business decisions. A former audit manager at PwC Switzerland, he also teaches at EXPERTsuisse and CREA.
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