Authorized Signatory vs. Board Member: Understanding the Distinctions in Swiss Company Law

In the realm of Swiss corporate governance, distinguishing between an authorized signatory and a board member is crucial. While both roles involve representing the company, their responsibilities, authority levels, and legal implications differ significantly.

Authorized Signatory:

● Definition: An individual granted the authority to legally bind the company in specific transactions.

● Appointment: Designated by the board of directors and registered in the Swiss Commercial Register.

● Responsibilities: Limited to the scope defined by the company; does not partake in strategic decision-making.

● Liability: Generally limited to the actions within their authorized scope.(FDEAER)


Board Member:

● Definition: An individual elected to the board of directors, responsible for overseeing the company's strategic direction.

● Appointment: Elected by shareholders during the general assembly.

● Responsibilities: Includes setting company policies, overseeing management, and ensuring legal compliance as outlined in Article 716a of the Swiss Code of Obligations.

● Liability: Holds fiduciary duties and can be held personally liable for breaches of duty, as specified in Article 754 of the Swiss Code of Obligations.


📌 Importance of Local Representation

Swiss law mandates that at least one individual with signing authority resides in Switzerland. This requirement ensures effective communication with Swiss authorities and compliance with local regulations, as per Article 718 of the Swiss Code of Obligations.(FDEAER)

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