Swiss transparency register (LTPM): identifying your beneficial owners before a sale

The LTPM creates a Swiss register of beneficial owners from 1 October 2026.

Introduction: transparency of beneficial owners becomes a condition of the sale

Who really controls your company, and can you prove it within a few days to an acquirer ? From 1 October 2026, this question ceases to be theoretical for Swiss companies. The Federal Act on the Transparency of Legal Entities and the Identification of Beneficial Owners, or LTPM in its French acronym, establishes a central register of beneficial owners, kept by the Confederation. Backed by a revision of the Anti-Money Laundering Act, it requires every company to declare the natural persons who ultimately control it.

« The company must declare to the transparency register the identity of its beneficial owners. », Federal Act on the Transparency of Legal Entities, art. 9.

In 2026, three dynamics converge and make the LTPM a transaction matter, not a mere administrative one. First, pressure from the Financial Action Task Force pushes Switzerland to close its gap on beneficial ownership transparency. Second, the timeline is short: entry into force on 1 October 2026 leaves little time to map sometimes complex shareholdings. Third, in a record but selective mergers and acquisitions market, any compliance gap becomes a negative signal in due diligence, liable to weigh on the price or to delay the closing. This article defines the LTPM and the notion of beneficial owner, traces its origin, specifies who is concerned and which penalties apply, explains how and when to become compliant within a sale process, then illustrates the whole with two worked cases, an FAQ and a summary.

Secure your company's compliance before selling it

At Hectelion, we integrate LTPM compliance into the preparation of a sale, so that it becomes a strength of the file rather than a friction point in due diligence. To discuss it, book a thirty-minute call through our online calendar, and let us address together the mapping of your shareholding and its articulation with your transfer project. Our dual franco-Swiss expertise and our independence from traditional financial intermediaries guarantee support centred on the success of your transaction.

Definition: what is the LTPM and a beneficial owner ?

The LTPM is the federal act that creates, in Switzerland, a central register listing the beneficial owners of legal entities. It complements the commercial register and the obligation to keep a share register by adding a new requirement: to identify, beyond the apparent shareholders, the natural person or persons who exercise ultimate control. The register is not public. Its access is reserved for the competent authorities, in a logic of combating money laundering and terrorist financing.

The beneficial owner is the natural person who, directly or indirectly, holds at least 25% of the capital or voting rights of a company, or who controls it in another way. This notion, familiar from the banking world, now extends to all the companies concerned. It requires tracing the ownership chains, including through holdings or foreign structures, up to the individual who pulls the strings. For a company with a simple shareholding, the exercise is trivial; for a group interposing several holdings, it can prove delicate.

Origin: from FATF pressure to a Swiss central register

The LTPM extends a long-standing international movement. The Financial Action Task Force, the reference intergovernmental body for combating money laundering, has for years recommended that every State establish a register of beneficial owners accessible to the authorities. The European Union preceded Switzerland with its successive anti-money-laundering directives. Long criticised for the opacity of some of its structures, Switzerland chose to strengthen its framework in order to preserve the reputation and international access of its economy.

Parliament adopted the act on 26 September 2025, for entry into force set at 1 October 2026, alongside a revision of the Anti-Money Laundering Act. The latter also extends certain due diligence obligations to advisors involved in higher-risk transactions. The LTPM therefore does not come out of nowhere: it translates a global standard into Swiss law, with a lag that explains the particular attention foreign investors examining a Swiss target now pay to it.

Who is concerned, which thresholds and which penalties

The scope of the LTPM is broad and the penalties are dissuasive. The table below summarises the key parameters that every executive and every acquirer must know before approaching a transaction.

Indicative table based on the published texts. The precise arrangements and transitional deadlines must be verified case by case with legal counsel.

Why LTPM compliance is a transaction issue

First, compliance conditions the serenity of the closing: an informed acquirer will require proof that the target has correctly declared its beneficial owners, failing which it inherits a fine risk. Second, it protects value: a non-compliance discovered in due diligence becomes a renegotiation point, on the same footing as a latent tax liability. Third, it speeds up the process: an already documented shareholding map spares weeks of back-and-forth in the middle of a transaction. Fourth, it reduces the criminal exposure of executives, personally targeted by the penalties in the event of an intentional breach. Fifth, it sends a governance signal: a company able to demonstrate its transparency inspires confidence in investors, particularly foreign ones, sensitive to reputational risk.

How to become compliant before a sale

Becoming compliant follows a methodical sequence. The first step is to map the real shareholding, tracing each ownership chain up to the natural persons, including through holdings and foreign structures. The second step applies the 25% and control criterion to formally identify the beneficial owners. The third step gathers the supporting documents: share register, articles of association, shareholders' agreements, ownership chart and identity documents.

The fourth step carries out the declaration itself, via the EasyGov platform, ensuring consistency with the commercial register and the share register. The fifth step sets up monitoring: any change in the shareholding must be reflected in the register, which requires an internal procedure. The sixth step, decisive in a sale perspective, is to integrate all these elements into the data room, in the form of a compliance file ready to be audited. This approach naturally articulates with a well-conducted due diligence and vendor due diligence.

When to address the LTPM in a sale process

The right moment is as early as possible, ideally from the preparation phase, well before entering due diligence. A company that anticipates presents itself with a clean file, which strengthens its credibility and its negotiating position. Conversely, discovering a compliance problem in the middle of a transaction, under the pressure of the timeline, places the seller in a weak position.

In the course of a sale process, LTPM compliance is addressed ahead of drafting the information memorandum, at the same time as the review of registered shares and of the ownership structure. For groups using a holding, the exercise deserves heightened attention, since the control chain is longer there. Finally, for a foreign acquirer examining a Swiss target, verifying LTPM compliance becomes an obligatory checkpoint of its own due diligence.

The LTPM in the sale contract: warranties and condition precedent

LTPM compliance does not play out only at the register: it is negotiated in the sale contract. It first appears in the form of a representation and warranty, by which the seller affirms that the company has correctly identified and declared its beneficial owners, and that no proceeding or fine is pending on that account. It then takes the form of a condition precedent: the acquirer subordinates its commitment to the delivery of proof of compliance, generally before signing or before the closing. A company that has prepared its file in advance lifts this condition without difficulty, whereas a seller caught off guard ends up having to regularise under the pressure of the timeline, in a weak position.

The central question is the allocation of the risk of a past non-compliance. In principle, the seller answers for it, either through a specific indemnity or within the framework of the asset and liability warranty covering all liabilities prior to the closing, LTPM fine included. When the uncertainty is significant, notably on complex ownership chains, a warranty and indemnity insurance (W&I) can take over and transfer that risk to an insurer, which smooths the negotiation. Treating the LTPM as a full warranty item, and not as a mere administrative box, is precisely what distinguishes a well-prepared sale file from one exposed to a last-minute renegotiation.

Whom to call on to prepare your compliance

Three criteria should guide the choice of a partner.

The first is understanding the transaction issues: LTPM compliance is not handled as an isolated formality, but as a component of the preparation for the sale.
The second is mastery of ownership structures, often cross-border, which requires being able to read a complex chart and trace up to the beneficial owner.
The third is the articulation with the other components of the file, from the family transfer to the qualified participation.

Hectelion supports executives and shareholders in this preparation, in connection with their legal counsel. An independent boutique firm, franco-Swiss, we act on transactions ranging from 2 to 500 MCHF and integrate compliance into the sale strategy. The declaration itself falls to the company and its legal counsel; our added value is to make this compliance a strength of the sale file. Note that Hectelion is not FINMA-authorised and does not act on transactions involving listed companies falling under such authorisation.

Advantages: legal security, credibility, transaction fluidity

The first advantage of anticipated compliance is legal security: the company and its executives guard against the fine risk, which can reach CHF 500,000. The second is credibility: a transparent file reassures acquirers, notably foreign ones, and makes governance a selling argument. The third is transaction fluidity: an already documented shareholding map avoids delays and blocking points in due diligence. To these benefits are added a better readability of the structure for the company's own steering needs and an alignment with international standards, a guarantee of access to investors.

Limitations: administrative burden, chain complexity, constrained timeline

The first limitation lies in the administrative burden: identifying, declaring then keeping the beneficial owners up to date mobilises time and resources, particularly for evolving structures. The second is the complexity of ownership chains: when control passes through several holdings or foreign entities, identifying the beneficial owner may raise questions of interpretation. The third is the constrained timeline: entry into force on 1 October 2026 requires acting without delay, while many companies are only discovering the scale of the task. To this is added the need to articulate the LTPM with the existing registers and with the revision of the AMLA, on pain of inconsistencies.

The 5 mistakes to avoid with the LTPM

Mistake 1: confusing registered shareholder and beneficial owner

The most frequent error is to declare the shareholders appearing in the share register without tracing up to the natural persons who control them. A shareholding holding is not a beneficial owner: the individual who owns it must be identified. Neglecting this tracing exposes the company to an inaccurate declaration, sanctioned on the same footing as an absence of declaration.

Mistake 2: handling compliance at the last moment

Postponing compliance until the opening of a due diligence turns a manageable formality into an emergency under pressure. Mapping a complex shareholding takes time, especially when documents are missing. Anticipating from the preparation phase avoids negotiating in a weak position.

Mistake 3: ignoring foreign ownership chains

When an acquirer or a shareholder passes through a foreign structure, some executives wrongly assume that the LTPM does not apply. Yet the obligation targets the Swiss company, whatever the nationality of its owners. Omitting the beneficial owner located abroad constitutes a non-compliance in its own right.

Mistake 4: forgetting the update after a change of control

The declaration is not a one-off act: any change in the shareholding, including on the occasion of a sale, must be reflected in the register. A company that declares correctly at a given moment, but neglects subsequent changes, falls back into non-compliance. An internal monitoring procedure is indispensable.

Mistake 5: dissociating the LTPM from the rest of the sale file

Treating LTPM compliance as an isolated box to tick, without linking it to the ownership structure, the shareholders' agreement and the data room, leads to inconsistencies. Transparency only has value, in a transaction, if it fits into a coherent file. An overall approach is the only rigorous one.

Case 1: bringing a family industrial SME into compliance before its sale

A Swiss industrial SME, incorporated as a public limited company, held by a family and valued at around 25 MCHF, is preparing its sale. Three family members hold respectively 40%, 35% and 25% of the capital. Under the LTPM, these three natural persons each exceed the 25% threshold and therefore constitute beneficial owners to be declared. Management gathers the share register, the articles of association and the ownership chart, then proceeds with the declaration via EasyGov, several months before the opening of the process.

The benefit is immediate during due diligence. The acquirer, a European industrial group, obtains without delay the proof of compliance, integrated into the data room in the form of a dedicated file. No reservation is raised on this point, and the condition precedent relating to the transparency of beneficial owners is lifted as early as the audit phase. This case illustrates a simple rule: compliance prepared in advance costs only a few days of work, whereas the same compliance improvised in the middle of a transaction could have delayed the closing and weakened the price. Transparency, here, becomes an argument of seriousness serving the seller.

Case 2: identifying the beneficial owner through a foreign holding

A Swiss services SME, incorporated as a limited liability company, is the subject of an acquisition by an investment fund. The fund does not acquire the target directly: it interposes a Luxembourg holding, itself held by the fund's vehicle. The control chain thus comprises three levels, and the beneficial owner is not the Luxembourg holding, but the natural person who ultimately controls the fund's management company. Identifying that person requires tracing the entire structure and applying the control criterion.

The issue is twofold. On the one hand, the Swiss target company must, once the operation is completed, declare its new beneficial owner in the register, failing which it exposes itself to a fine of up to CHF 500,000. On the other hand, the acquirer includes in the contract a condition precedent: the prior verification of the target's LTPM compliance over the earlier period. The seller who neglected this point ends up having to regularise under constraint, with a discount risk. This case shows that, in cross-border structures, the LTPM does not boil down to a form: it requires a careful reading of the ownership chain, exactly where the risks of a franco-Swiss sale lie.

A word from the founder

« Transparency is no longer a compliance option, it is a transaction asset. A company that can prove who controls it sells better, and faster. »

« The trap of the LTPM is not the declaration itself, but the tracing of ownership chains. That is where the bad surprises hide, often abroad. »

« Our role is not to substitute for legal counsel, but to make compliance a strength of the sale file, prepared well before the acquirer asks the question. »‍

Aristide Ruot, Founder and Managing Director of Hectelion SA.

FAQ: the 10 essential questions on the LTPM

Introduction: what to remember before the questions

The questions that follow gather the most frequent queries of executives and shareholders of Swiss SMEs faced with the entry into force of the LTPM, particularly in view of a sale. They cover the scope, the notion of beneficial owner, the penalties and the articulation with a transaction. Each answer aims for operational clarity, without substituting for personalised legal advice.

Q1: Which companies are concerned by the LTPM ?

The act targets Swiss private-law legal entities, foremost among them public limited companies, limited liability companies and cooperatives, as well as certain foreign entities with a substantial link to Switzerland. The scope is therefore very broad and concerns the vast majority of SMEs.

Q2: What is a beneficial owner ?

It is the natural person who, directly or indirectly, holds at least 25% of the capital or voting rights of a company, or who controls it in another way. The notion requires tracing beyond the apparent shareholders up to the individual who exercises real control.

Q3: When does the LTPM enter into force ?

The act was adopted by Parliament on 26 September 2025 and enters into force on 1 October 2026, alongside a revision of the Anti-Money Laundering Act. The timeline leaves little time to map complex shareholdings.

Q4: Is the register public ?

No. The transparency register is not accessible to the public. Its access is reserved for the competent authorities, in a logic of combating money laundering and terrorist financing, and not of general publicity of the shareholding.

Q5: What are the penalties for non-compliance ?

The intentional violation of the declaration obligations is punishable by a fine of up to CHF 500,000, and up to CHF 100,000 in the event of negligence, according to article 43 of the LTPM. Executives may be personally targeted, which heightens the stakes.

Q6: How to declare your beneficial owners ?

The declaration is made via the Confederation's EasyGov platform. It requires having first identified the beneficial owners and gathered the supporting documents, then ensuring the update of the register at each change of shareholding.

Q7: How does the LTPM affect a company sale ?

An acquirer will require proof that the target has correctly declared its beneficial owners, since it would otherwise inherit a fine risk. A non-compliance becomes a renegotiation point in due diligence, liable to weigh on the price or to delay the closing.

Q8: How to identify the beneficial owner through a holding ?

Each level of the ownership chain must be traced, including through foreign structures, up to the natural person who exercises ultimate control. A shareholding holding is never itself the beneficial owner: it is an intermediary to be traversed.

Q9: Does the LTPM concern foreign acquirers of a Swiss SME ?

The obligation falls on the Swiss company, whatever the nationality of its owners. A foreign acquirer will therefore, after the operation, have to declare its own beneficial owner status, and will verify upstream the target's compliance over the earlier period.

Q10: Should you wait for the entry into force to act ?

No. The mapping of the shareholding and the constitution of the file can and must begin without delay, all the more so as the EasyGov platform allows the declaration to be prepared upstream. Anticipating is the best way to approach a sale from a position of strength.

Conclusion: making transparency a transaction asset

The LTPM marks a turning point for Swiss companies: from 1 October 2026, knowing how to prove who really controls one's company is no longer optional. For an executive contemplating a sale, this constraint can turn into an advantage. Anticipated compliance legally secures the company and its executives, reassures acquirers, particularly foreign ones, and smooths due diligence. Conversely, a gap discovered in the middle of a transaction becomes a costly renegotiation point. The issue is not only administrative: it is strategic, since the transparency of the shareholding now participates in the value and the saleability of a company. In a franco-Swiss environment where ownership structures are often cross-border, this mastery makes the difference between a fragile file and a file that inspires confidence.

Article summary

The Federal Act on the Transparency of Legal Entities and the Identification of Beneficial Owners establishes, from 1 October 2026, a Swiss central register listing the natural persons who ultimately control companies. Adopted on 26 September 2025 in the wake of FATF standards and a revision of the Anti-Money Laundering Act, it targets public limited companies, limited liability companies, cooperatives and certain foreign entities linked to Switzerland. The beneficial owner is the natural person holding at least 25% of the capital or votes, or exercising control, and its omission exposes the company to a fine of up to CHF 500,000.

For an executive preparing a sale, LTPM compliance is a transaction issue before being a formality. It requires mapping the shareholding, identifying the beneficial owners, gathering the supporting documents, declaring via EasyGov, ensuring the monitoring and integrating the whole into the data room. The two cases presented, a family SME and an acquisition by a fund through a foreign holding, show that anticipation turns a constraint into an asset, whereas improvisation weakens the price and the timeline. The register being not public and its access reserved for the authorities, the objective remains combating money laundering, not the publicity of the shareholding. Hectelion supports executives and shareholders in making this transparency a strength of the sale file, in France as in Switzerland.