Practical Guide for NGOs

How to set up a non-governmental organisation in Geneva or Switzerland


1. DEFINITIONS AND LEGAL EXPLANATIONS

  1. Non-Governmental Organization (NGO)
  2. Foundation
  3. Non-Profit Association

2. ESTABLISHING A FOREIGN ORGANIZATION IN GENEVA

  1. Legal recognition and opening an office
  2. Visas for conferences
  3. Residence Permit
  4. Work Permit
  5. Useful addresses and assistance

3. SET UP AND FUNCTIONING OF AN ASSOCIATION IN SWITZERLAND

  1. Structure of an association
  2. Setting up an association
  3. Drawing up statutes

4. FUNCTIONING OF AN ASSOCIATION AND PRACTICAL ADVICE

  1. Rights and Obligations
  2. General Assembly
  3. Book-keeping / Accounting
  4. Taxation
  5. Recognition of charitable purposes and Tax Exemption
  6. Registering with the Trade Register
  7. Consultative status with International Organizations

5. ADDRESSES AND USEFUL CONTACTS


1. SOME DEFINITIONS AND LEGAL EXPLANATIONS

1. Non-Governmental Organization (NGO)

The concept of a non-governmental organization (NGO) was invented by the United Nations in order to define a State-independent organization with which the UN has a relationship.
As a rule, a non-governmental organization meets the following criteria:

  1. It has the structure of an organization, with statutes and a legal form.
  2. It was founded by individuals or organizations independent of the State.
  3. Its decision-making bodies are independent of government authorities.
  4. Its aims are non-lucrative and of public interest, which usually go beyond the interests of its own members.

It is, therefore, an organization founded on private initiative in order to fulfil aims of public interest. NGOs may have several legal forms. However, most NGOs are set up in the form of not for profit associations or foundations.

2. Foundation

A foundation is a legal entity responsible for managing an asset (money, buildings, etc.) for a given purpose. In Switzerland, foundations are regulated by articles 80 onwards of the Swiss Civil Code (in French, German or Italian). To be established, a foundation must have a minimum starting capital of CHF 50,000 if it operates nationally or internationally (or CHF 10,000.- if its activities are exclusively cantonal) and it must be formed in front of a notary. It is then submitted to an organ of federal or cantonal surveillance that will ensure that the foundation's resources are used in accordance with its goals. A foundation is a relatively rigid legal structure: once the aims are adopted on creation, they cannot, as a rule, be changed.

Information may be obtained from:

Office fédéral de surveillance des fondations
Tel.: + 41 (0)31 322 80 25
Website: www.edi.admin.ch

Service genevois de surveillance des fondations
Tel.: +41 (0)22 327 55 23
Website: http://ge.ch/fondations

3. Not-for-profit Association

The non-profit association is the most common legal form for NGOs. In Switzerland, the legal principles governing the establishment and functioning of these associations are found in Articles 60 to 79 of the Swiss Civil Code (in French, German or Italian). The aim of the association must be non-profit. This does not imply that the association must refrain from generating profit, but that any profits that are made may not be distributed to members and must be used by the association in order to achieve its aims. By law an association is considered to be a body in its own right. It can, therefore, employ personnel, make agreements, etc. Equally, it is liable for the actions carried out in its name. (see paragraph 5.1).

   
2. ESTABLISHING A FOREIGN ORGANIZATION IN GENEVA

1. Legal recognition and the opening of an office

Swiss Law is one of the most open on the subject. As far as Europe is concerned, Switzerland ratified the European Convention on the Recognition of the Legal Personality of Non-Governmental International Organizations of the European Council (Homepage for NGOs: www.coe.int/T/NGO). European NGOs with a recognised legal personality in a State party to this convention therefore automatically acquire a recognized legal personality in Switzerland. Organizations that were founded in other regions of the world must have an official address in Switzerland, and their aims, statutes and activities must conform to Swiss Law and in particular, they must be non-profit.

2. Visas for conferences

For most nationalities no visa is required, as long as the person does not stay for longer than 3 months, and does not undertake any lucrative activity. For other nationalities, the conditions and documents required to obtain a visa vary. It is best to check in advance with the Swiss representation competent for your country of residence. If the case arises, you must present documents supporting your participation at a conference, as well as provide proof that you have sufficient means of subsistence while in Switzerland. Complete information on Swiss entry requirements is available on the website of the Federal Office of Immigration: www.bfm.admin.ch. You will also find a lot of useful information in the "Delegate's Guide".

Further information is available in the FAQ section.

3. Residence Permit

A foreigner who wishes to stay in Switzerland must apply for a residence permit. The conditions concerning entry into Swiss territory and the residence permit may vary according to nationality. The formalities for obtaining a residence permit vary according to the purpose of the visit, that is, whether the person intends to carry out a lucrative activity or not, if they are settling supported by their own means, or if they are visiting Switzerland without undertaking any lucrative activity. Simplified procedures exist for nationals of European Union and European Free Trade Association countries. For nationals from other regions the application for a residence permit must be made to the Cantonal Population Office (OCP) via the Swiss representation competent for your country of residence before entering Swiss territory.

4. Work Permit

An organization may employ Swiss or foreign personnel, who have a work permit. On the other hand, if the organization wishes to hire foreign personnel who do not yet hold a work permit, it must file an application for a work permit with the competent cantonal administration. In Geneva, this is the Cantonal Population Office (OCP). Information about wage conditions to be observed is available with the Office for the Inspection of Employment Relationships (OCIRT). A person is not authorised to work before having received the permit.

5. Useful addresses and assistance

Office cantonal de la population (OCP) - Service des étrangers
Route de Chancy 88
Case postale 265251
CH - 1211 Genève 2
T: +41 (0)22 546 48 88
F: +41 (0)22 546 48 10
Website: www.geneve.ch/ocp/ (in French only)

Office Cantonal de l'Inspection des Relations de Travail (OCIRT)
Rue des Noirettes 35
Case postale 1255
CH - 1227 Carouge
T: +41 (0)22 388 29 29
F: +41 (0)22 388 29 30
Site web: www.ge.ch/moe/uk

The NGO Service of the state of Geneva can help NGOs that wish to establish themselves in Geneva.

NGO Service of the Canton of Geneva
Villa "La Pastorale"
Route de Ferney 106
Case postale 103
CH - 1211 Genève 20
T: +41 (0)22 546 14 00
F: +41 (0)22 546 14 19

 
3. SET UP AND FUNCTIONING OF AN ASSOCIATION IN SWITZERLAND

1. Structure of an association

A non-profit organization is generally composed of three main organs:

  1. The General Assembly of members, which generally meets annually and which makes the most important decisions. This is the supreme organ.
  2. The Executive Committee of the association, which is responsible for managing the association throughout the year and must give a report to the members at the General Assembly. The Committee is elected by the General Assembly and is composed of a minimum of :
    1. A President, responsible for representing the organization and convoking the general assemblies;
    2. A Secretary, responsible for collating the documents and notably the minutes of the Committee;
    3. A Treasurer, responsible for managing the funds and other assets of the association.
  3. The Auditor, who is responsible for checking the accounts must report to the General Assembly. The Auditor is nominated by the General Assembly. He can be a member of the association, but not of the Executive Committee. The Auditor does not have to be a professional accountant, but must be sufficiently competent to be able to check the accounts objectively. Above a certain size of budget the appointment of a professional, or even a trustee, to perform the checking of the accounts, is strongly recommended.

2. Setting up an Association

In Switzerland, setting up a non-profit association is unrestricted and relatively easy. The people or organizations interested in forming an association must meet in a constitutive assembly in order to:

1. Adopt the statutes of the association, in accordance with Articles 60 to 79 of the Swiss Civil Code.
2. Nominate the members of the organs: the Executive Committee and the Auditor.

The association then becomes a legal entity with rights and obligations. The constitutive assembly must normally be recorded in written minutes that must be kept by the association and which must contain a list of the members who participated in the creation of the association.
In Switzerland, there is no registry or compulsory registration of associations with the authorities. It is, however, recommended to register with the NGO Service of the Canton of Geneva in order to facilitate relations with authorities. Yet if the association develops a commercial activity, such as the sale of products, it is compulsory to register with the Trade Register, provided that its annual turnover exceeds CHF 100'000. Note that this registration has no effect whatsoever on the acquisition of legal personality.

3. Drawing up Statutes

The drawing up of statutes constitutes an obligatory and fundamental step in the setting up of an association. The statutes define the functioning of an organization and are the basis of all its activities. Thus it is worth taking the greatest care and reading Articles 60 to 79 of the Swiss Civil Code (in French, German and Italian only) closely when drawing up the statutes. Although they may depart from certain articles, the statutes must, in all cases, respect the following principles:

  • The executive organ, the committee, must be both nominated and revoked by a deliberating organ, which is the general assembly. (Article 65 SCC)
  • The general assembly is the only organ that is empowered to modify statutes. (Article 66 SCC)
  • Members must have the right to leave. (Article 70 SCC)
  • No alteration to the association's objectives can be imposed on its members. (Article 74 SCC)
  • The general assembly, the supreme organ, may be convened at any time at the request of one fifth of the members (or less, if the statutes provide for this) (Article 64 SCC)

Apart from these minimal rules, an organization is free to determine its functioning.

The statutes must include:

  • A definition of the purpose that defines the area of action and objectives of the organization.
  • Headquarters: State where the association has its Head Office. For example, it can be stated that: "The Headquarters of the Association is in Geneva. The Committee of the association will determine its postal address."
  • The organs: Indicate the organs of the organization (General Assembly, Committee, etc), as well as their prerogatives and their mutual relationship.
  • Decision-making mechanisms: State the decision-making process: simple majority vote, qualified majority vote, two-thirds vote, etc. Different majorities may be required according to the kind of decision to be made. For example, it is recommended that a decision on dissolution should require a two-thirds majority.
  • Manner of representation and signature: Who can sign for and who can commit the responsibility of the association towards a third party.
  • Resources: The organization's sources of finance, especially the question of subscriptions paid by members.
  • Members' status: State the terms of membership of the organization, as well as members' rights and obligations. It is also possible to envisage having different categories of membership, such as "associate" or "passive" members, etc. The possible exclusion of a member is a matter of equal importance.
  • Dissolution: The rules concerning dissolution and the use which could be made of the association's assets.

Sample statutes of an association can be found on the CAGI's website. The NGO Service of the Canton of Geneva can assist you in drawing up statutes.

NGO Service of the Canton of Geneva
Villa "La Pastorale"
Route de Ferney 106
Case postale 103
CH - 1211 Genève 20
T: +41 (0)22 546 14 00
F: +41 (0)22 546 14 19

 

4. FUNCTIONING OF AN ASSOCIATION AND PRACTICAL ADVICE

Once the statutes have been drafted and adopted, the organization exists as a legal personality and can begin to develop its activities.
 

1. Rights and Obligations

As a body, the association may hire staff, pass agreements, rent premises, and organize its activities and events.

Similarly the association has duties, notably:

  1. It has an obligation to respect Swiss legislation.
  2. It is responsible for the acts carried out in its name, and must honour its commitments.
  3. It is responsible for any possible damage it might cause to a third party, and in this case must provide compensation.
  4. It must hold an annual general assembly to which its members are convened.
  5. It must keep its accounts up to date.
  6. If it develops a commercial activity it must declare its income to the tax authorities.

The Committee members have a specific responsibility. They must see to the good management of the association. Thus, they can be personally prosecuted for mistakes, carelessness and damage caused to a third party. The Committee must also provide the Auditor with all the documents and supporting evidence requested by him.

The members of the association can also be held personally responsible if the association has debts that it cannot pay. However, it is possible and strongly recommended to limit the risk for members by limiting their responsibility in the statutes of the association.

Given the legal responsibilities of the association, it is highly recommended to take out a company style "legal liability" insurance policy. Such insurance generally costs around a hundred Swiss Francs a year and offers comprehensive cover.

2. General Assembly

The General Assembly has to meet at least once a year. The Executive Committee should, on this occasion, present its report on the activities of the association during the past year, as well as the financial situation. At the same time, the auditor must also present his report and recommend whether the accounts should be approved or not. The members may then vote on the dissolution of the Committee and nominate a new Committee (which may be composed of the same persons).

It is useful to reread the statutes of the association and the decisions made at the last general assembly regularly. Make good use of the general assembly to bring the statutes up to date, in a such a way as to account for the evolution of the association.

3. Book-keeping / Accounting

As soon as an organization has a commercial activity, it must be in a position to present clear and complete accounts. The book of accounts, as well as supporting documents, must be kept for a minimum of ten years. The Committee, and the Treasurer in particular, are legally responsible for the correct keeping of the accounts. The Auditor is likewise held responsible for checking the accounts carefully and must report possible irregularities. In the case of misappropriation of funds, civil and penal proceedings may be started. The accounts and finances must therefore be managed with the greatest care.

Certain principles help in risk limitation:

  1. Nominate a competent Treasurer.
  2. Have recourse to a professional auditor when the budget exceeds CHF 50'000 per year (recommended)
  3. Use a quality accounting programme, but one that is adapted to the accountancy workload.
  4. Keep the books up-to-date.
  5. Never refund any expenditure without evidence.
  6. Use a postal cheque account www.postfinance.ch or bank account to manage the funds of the organization and to effect all payments.
  7. Use the double signature principle for all important movements of money.

4. Taxation

Associations are considered to be bodies and consequently are subject to several taxes, such as the federal, cantonal and local council taxation if the commercial volume exceeds a certain threshold. This threshold can vary from one canton to another. For taxation in Geneva, you may consult the following pages of the Department of Finance: legislation and www.ge.ch/df (in French only).

Associations are likewise required to pay Value Added Tax (VAT) as soon as their annual turnover exceeds CHF 75'000.

5. Recognition of charitable purposes and Tax Exemption

An association or foundation may apply for tax exemption. Such exemption is linked to the pursuit of charitable objects and can exempt the association or foundation from all or part of the taxes due.

  • Its objective is of public interest.
  • It carries out a disinterested activity and is clearly non-profit making.

It can then file a request for tax exemption with the cantonal tax authority by presenting a file containing the activities, accounts, statutes and a list of committee members of the organization during the previous years. The same procedure is valid for the VAT exemption application (it is advisable to speak to the Swiss Federal Tax Administration, the only competent authority in this field).

For the Canton of Geneva (cantonal taxes and direct federal taxes):

Administration fiscale cantonale
Hôtel des finances
26 rue du Stand
Case Postale 3937
CH - 1211 Geneva 3
T: +41 (0)22 327 70 00
F: +41 (0)22 327 55 97

The statutes must contain a clause foreseeing that, in the event of the dissolution of the organization, funds are not returned to the founders, but are awarded to an institution having an analogous objective. The authorities concerned reserve the right to check the evolution of the activities and objectives of the organization and can revoke tax exemption.

Persons who make donations to tax exempt public interest organizations can usually deduct these donations from their taxes.

6. Registering with the Trade Register

Only organizations or associations, which carry out a commercial activity and have an annual turnover in excess of CHF 100'000 are required to register. For other organizations registration is optional. All registration applications must be presented to the Trade Register of the Canton in which the organization is based.

For the Canton of Geneva contact :

Registre du Commerce de Genève
Rue du Puit Saint-Pierre 4
Case postale 3597
CH - 1211 Geneva 3
T: +41 (0)22 327 28 92
F: +41 (0)22 327 05 05
Website: www.ge.ch/ecohrcmatic (in French only)

Registration applications must be made by the representatives of the organization and must be accompanied by several documents. The conditions for Geneva are available on the Internet: www.ge.ch/ecohrcmatic (in French only). The application for registration is transmitted to the Federal Office of the Trade Register, which must approve the registration in order for it to be valid. It is also the Federal Office that is responsible for publishing the registration of the association with the Trade Register in the "Feuille officielle Suisse." Between CHF 500 and CHF 600 must be allowed for administrative fees.

Note that any modification to statutes, or any change of persons sitting on the committee, must be declared to the Trade Register within thirty days and will entail a fee.

7. Consultative status with International Organizations

Non-Governmental Organizations that wish to establish cooperative links with certain international organizations, such as the UN, the WHO, the HCR or the ILO, have several possibilities:

  1. Numerous organizations cooperate with international organizations on an informal basis. You can inform these organizations of your activities. You can generally also take part in certain activities, or even some meetings by requesting one-off accreditation to them.
  2. If your organization is interested in having a closer, cooperational relationship with one of the international organizations, it can request consultative status with the organization concerned. The criteria for obtaining consultative status vary from one organization to another.

In all cases we recommend that you contact the international organization concerned and make an appointment with the officer in charge of NGO relations. You can also consult our Guide on working with International Organizations.

Office des Nations Unies à Genève
Bureau de liaison chargé des relations avec les ONG (bureau 153)
Palais des Nations
CH - 1211 Geneva 10
T: +41 (0)22 917 21 27
F: +41 (0)22 917 05 83
E-mail : ungeneva.ngoliaison@unog.ch

  
5. ADDRESSES AND USEFUL CONTACTS

Mandat International:

The aim of Mandat International is to facilitate the participation of non-governmental delegates at International Conferences in Geneva. The Mandat International website offers much useful information in French, English, Spanish and Arabic: useful links, a delegate's guide, diary of conferences, and an information platform among others. Feel free to drop by our office any time.

E-mail: contact (at) mandint.org
Website: www.mandint.org

The Geneva Welcome Centre

The Geneva Welcome Centre responds to the demands of international personnel taking up residence in Geneva. It has an NGO Service, notably responsible for receiving and dealing with NGOs requests for help in setting up in Geneva: tax exemption, work permits and so forth. International NGOs and their personnel have also access to the other services offered by the Welcome Centre.

The Geneva Welcome Centre
Villa "La Pastorale"
Route de Ferney 106
CP 103
CH - 1211 Genève 20
T: +41 (0)22 546 14 00
F: +41 (0)22 546 14 19
Website: www.cagi.ch

 

Geneva Federation for Cooperation and Development (GFCD)

The GFCD comprises around fifty associations working in the area of cooperation in development in the Canton of Geneva. The GFCD promotes cooperation between its members and facilitates the financing of development projects.

Geneva Federation for Cooperation and Development
rue Amat 6
1202 Genève
T: +41 (0)22 908 02 80
F: +41 (0)22 908 02 89
E-mail: secretariat@fgc.ch
Website: www.fgc.ch

 

La Maison des Associations

The Foundation for Associative Expression manages the House of the Associations, which consists of several buildings in the very centre of the city. It provides associations with moderately-priced office space, as well as premises for archiving, meeting rooms, etc.

Maison des Associations
15 Rue des Savoises
CH - 1204 Genève
T: +41 (0)22 329 20 22
F: +41 (0)22 329 20 23
Website: www.lafea.org (in French only)


  
Useful links on the Internet

Useful links are available on our own websites : www.mandint.org and www.welcomedesk.org.

 

Publications

Among other publications we recommend Marie-Chantal Collaud's book "Comment créer et animer une association" (How to found and drive an association) (Editions Réalités sociales, Lausanne, 2002). It contains numerous examples and practical advice.