Abolition of bearer shares (Switzerland)

Since 30 April 2021, every remaining Swiss bearer share has been automatically converted into a Registered share (Switzerland), as part of the tightening of transparency rules on ownership of unlisted companies.

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Two exceptions remain: companies whose shares are listed on a stock exchange may keep bearer shares, as can securities issued as intermediated securities within the meaning of the Swiss Federal Intermediated Securities Act (FISA), a regime distinct from the simpler one governing Uncertificated securities (Wertrechte).

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This reform is part of a broader move toward transparency on the beneficial owners of Swiss companies, whose central register is covered in our article on the Swiss transparency register. A company that failed to carry out this mandatory conversion faces, beyond the governance risk, a concrete practical obstacle at any later sale of its shares.

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In financial due diligence of an unlisted Swiss company, finding traces of old, unconverted bearer shares, or a Commercial Register (Switzerland) not updated since 2021, is a governance red flag that deserves to be resolved before any negotiation.