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Frequently asked questions (FAQ)


What is the definition of a non-governmental organisation (NGO)?

 

A non-governmental organisation (NGO) is defined as an independent institution created under national private law. It is non-profit and pursues goals of international public utility, in two countries at least.

 

It is worth noting that there is no internationally recognized definition of an NGO.

 

The association is a moral person in law, has its own legal personality and enjoys all civic rights.

 

Non-profit does not mean the association cannot make a profit, only that any profits must be re-invested in the work of the association in order to fulfil the defined purposes.

 

For more information please go to the chapter: "Creation or transfer"

 

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Who can become a member?

 

Any person enjoying civic rights may join an association.

 

Membership conditions are in principle set out in the Statutes (see: "Model statutes"). A person is considered to enjoy civic rights when he/she has attained the age of majority and is capable of discernment.

 

A minor may join an association and have voting rights without the consent of his/her legal representative. A minor may not, however, take part in decisions which commit him/her financially beyond an amount authorised by the legal representative.

 

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What is the civil liability of the association?

 

The civil responsibility of a moral person is governed by the article 75a of the Swiss Civil Code.

 

The members of an association, as well as the Committee members, cannot personally be held responsible for debts and obligations contracted by the association in the pursuit of its activities.

 

The civil and criminal responsibility of members of the Committee cannot be invoked for offences committed by the association in its own name.

 

Criminal responsibility may, however, be considered to exist if they have deliberately been at fault or broken the law (theft, damages, sexual abuse, etc.)

 

Financial responsibility of members is limited to the amount of the membership fee. They cannot therefore be sued by creditors.

 

The association’s responsibility is engaged and it is legally responsible for negligence or fault or damages it causes to third parties. That is why it is obliged to take out insurance. (See: "What insurance coverage must an NGO have?")

 

There are three exceptions:

 

  • The Statutes can provide for the financial responsibility of members.
  • Committee members are personally responsible for any faults committed in the exercise of their duties that have caused damage to third parties (Art. 55, para 3).
  • A Committee member who has breached his/her obligations to the association can be sued for compensation. This is known as due diligence toward a moral person.

 

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What should be on the minutes of the constitutive general assembly (GA)?

 

«Name of the association», «date», «place»

 

  1. Welcome
    The future Chairperson welcomes participants, lists those who have excused themselves, and circulates an attendance list. Then:
  2. Presentation of the aims of the association
    Short description of the idea (raison d’être, background, why create the association…).
  3. Approval of the statutes
    The statutes are discussed article by article, and then approved, with or without amendment. At the end the Statutes are approved as a whole.
  4. Election of Committee members
    Candidates for membership in the Committee present themselves to the GA, which then votes according to the system that has been selected (e.g. simple majority).
  5. Election of the auditors
    Candidates present themselves to the GA, which then votes. Auditors may not come from among members of the Committee.
  6. Setting membership fees
    The GA votes on the amount of membership fees.
  7. Consideration of the activities of the association
    The newly elected Committee presents the future activities of the association.
  8. Approval of the budget of the association
    The Committee presents the budget for the current year.
  9. Diverse, individual propositions
    To discuss one after one.

 

You are invited to share a drink at the conclusion of the Assembly.


Secretary:                                               President:

 

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What should be on the minutes of an ordinary general assembly (GA)?

 

The invitation containing the agenda must be sent to each member at least 10 days prior to the meeting. There is no particular format mandated under Swiss law.

 

Agenda of the General Assembly of «name of the association», «date», «place»

 

  1. Welcome
  2. Adoption of the agenda
  3. Approval of the minutes of the previous GA
  4. Annual report
  5. Approval of the annual report
  6. Presentation of the financial report for the previous financial period by the Treasurer
  7. Approval of the accounts
  8. Adoption of the programme of action for the next year
  9. Optional: review of membership fees
  10. Approval of the budget, and clearance to the Committee and to the auditors.
  11. Elections:
    1. Committee members («list of members elected or re-elected»)
    2. Auditors («names of those elected»)
  12. Diverse, individual propositions.

 

 

When there are no more speakers, the chairperson adjourns the meeting, thanking everyone for their participation.

 

You are invited to share a drink after the close of the meeting.

 

 
Secretary:                                              President: 


Annexes:

  • Minutes of the last GA
  • Activity report
  • Financial report
  • Budget
  • Any other document which might facilitate the deliberations of the GA.

 

(See: "How to write minutes?")

 

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How to write minutes?

 

It is mandatory to prepare minutes of any constituent, ordinary, or extraordinary general assembly. There is no prescribed format under Swiss law.

 

Minutes of the GA of «name of the association», «date», «place»

Present: «List of those present»

Excused: «List of those excused»

Absent: «List of those absent»

Chairperson: «Name»

Rapporteur: «Name»

Start of the meeting (e.g.): 17.30                             End of the meeting (e.g.): 19.15
__________________________

Minutes should mention:

  • The agenda
  • Any decisions taken during the meeting.

 

Secretary:                                              President: 

PS: The address of the association is normally mentioned.

 

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How to redact a business plan?

 

Developing a business plan for an NGO helps to put the strategy of your organization. This is a reference document providing comprehensive information on the essential points of the activities of your NGO.

 

You can take examples given to the private societies. The SME portal of the Swiss Confederation proposes different modals of business plan.

 

The SME office of the canton of Geneva also gives you advices.  The guide's creator may also be useful.

 

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What does Swiss labour law say?

 

You can consult Swiss labour law on the CAGI site. It contains useful information about work contracts.

 

European and non-European nationals can get more information on the work permit page.

 

For a guide to salaries in Switzerland, you can consult the on-line salary calculator for the Canton of Geneva at the website of the Geneva Labour Market Observatory.

 

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What accounting requirements are there?

 

Since the 1st of January 2008, the authorities have clarified a number of rules, notably by making the requirement that there be formal accounts and an audit depending not on the legal form of the organisation, but on its size.

Association

 

The Committee must keep formal accounts. The books (inventory, operating account, and statement of account) must be complete, clear, and easy to consult, so that anyone interested has as accurate a picture as possible of the financial health of the association (art. 959 CO).

The accounts must be in Swiss francs (Art. 960, para 1 CO) and must be preserved at least 10 years. It is important therefore to keep all documentary evidence. The Code of Obligations applies, by analogy, to the provisions of  Code of Obligations relating to public companies.

  • An association may undergo a restricted audit, by an auditor, if a member demands it. Otherwise, the GA and the statutes govern how financial control will be carried out.

 

  • An association may undergo an ordinary audit if, over two successive exercises, two of the following values have been exceeded:

 

  • Balance > CHF 10 million
  • Turnover> CHF 20 million
  • Personnel > 50 full-time staff on average annually

 

  • During an ordinary audit, the auditors will check not only that the accounts are in conformity with the legal and statutory requirements, but also the existence of a system of internal control.

 

Foundation

 

Foundations must in all cases designate an external audit body. This organ has to be registered towards the Register of trade.

 

The audit organ can get a waiver from the Supervisory Authority if the following two cumulative conditions are met:

  • The total statement of account of two successive exercises is less than CHF 200'000,--
  • There has been no public collection of money.


The auditor must be particularly qualified if:

 

  • The foundation solicits public collection of money / donations from the public in excess of CHF 100'000, during two successive exercises
  • Two of the following values are exceeded:

  • Balance > CHF 10 million
  • Turnover> CHF 20 million
  • Personnel > 50 full-time staff on average annually

 

  • It has to have group accounts
  • It has raised money through a bond issue.


For more information, you may consult:

 

 

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Are the Swiss Gaap RPC standards applicable in Switzerland?

 

The aim of these standards is to provide a coherent and transparent framework for the presentation of annual accounts of small and medium entities, as well as non-profit organisations.

 

The recommendations are the work of the RPC foundation. NGOs are not obliged to apply them. Nevertheless, more and more NGOs do. The presentation gives a true picture of the wealth, financial situation, and the results of the NGO, in order to improve, in particular, communication with donors and other relevant entities, while making it easier to compare annual accounts / financial situations among entities and over time.

 

Each standard comprises a recommendation, followed by an explanation, and sometimes examples and a glossary.

 

Standard RPC 21 relating to the accounts of non-profit organisations of public utility will be of particular interest. You will find all the Swiss RPC standards on-line at RPC foundation.

 

You may also consult:

 

 

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Is an NGO subject to VAT?

 

VAT is governed by the Federal law on value-added tax (LTVA), of the 2nd of September 1999. There are various explanatory brochures on the website of the Federal Tax Administration. Your attention is drawn in particular to brochure No. 540-21 related to aid organisations, and social and charitable institutions.

 

For further information, please contact the Principal Division for VAT.

 

Liability

 

What does the law say? "Is subject to tax anyone who operates a business, even non-profit, whatever its legal form and purpose, if not released from liability under paragraph 2". (art. 10 al. 1 LTVA).

 

Exempt from tax liability under paragraph 1 is anyone who:

 

" carries on Swiss territory, under non-profit and voluntarily managed company sporting or cultural institution or public utility, a turnover of less than 150,000 francs from taxable benefits it provides, as long as it does not renounce to be released from liability. The turnover is calculated on the basis of agreed contreprestations (excluding tax). " (art. 10 al. 2c LTVA)

 

The association must be to the benefit of tax exemption.


Is the turnover taxable?

 

Taxable turnover includes all income received for outputs and which are subject to VAT. If the outputs are paid for in kind (goods or services) the value of the goods or services is part of turnover.

 

If it is a public-interest institution or a private person that gives rise to the earnings, this is considered as a donation and is not taken into account, even if that donor is mentioned, in a neutral way, or is thanked, in a publication, or if its logo is made public.

 

Membership fees are not subject to VAT. Proceeds from entrance tickets to cultural or sporting events are also not subject to VAT, in principle.

 

Subsidies and other contributions from the public authorities are also not considered part of earnings, even when they are based on performance mandate. Such subsidies and contributions are defined as any money or service that has a monetary value that is not paid in an exchange of services.

 

If the association does not have annual turnover of at least CHF 150,000.-- per annum, it is not subject to VAT.

Turnover > 150'000 CHF

 

If the association has annual turnover of more than CHF 150,000.-- per annum, you must declare so in writing to the VAT Division of the Federal Tax Administration, unless you have a tax exemption.

 

You may order the questionnaire for registering for VAT on the website of the Federal Tax Administration.

 

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What social insurance is obligatory in Switzerland?

 

Sickness insurance (AMal) and accident insurance (AA) are obligatory in Switzerland and payable by every person living in Switzerland. (See: "Social insurance")

 

For more information, please contact the sickness insurance service (DGAS).

 

Contributing to the following social security schemes is obligatory in Switzerland:

 

  • Maternity insurance (Amat)

 

Contribution AVS/AI/APG/AC/AF/Amat:

Indicative rate, valid from the 1st of January 2011: 

(reference: Caisse cantonale genevoise de compensation)

 AVS  8,40%  4,20% at the charge of the employee and 4,20% of the employer
 AI  1,40%  0,70% at the charge of the employee and 0,70% of the employer
 APG  0,50%  0,25% at the charge of the employee and 0,15% of the employer
 Sub-total  10,30%  so 5,15% at the charge of the employee
 AC  2,20%  1,10% at the charge of the employee and 1,00% of the employer
 AF  1,40%  at the exclusive charge of employer
 Amat  0,09%  0,045% at the charge of employee and 0,02% of employer
 Administration fees
  0,27%

 On the amount of the salary paid
 at the exclusive charge of employer


The Administration fees on the amount of the salary paid is at the exclusive charge of employer and the amount varies.


Military insurance is financed from the federal budget.

A work-related pension scheme (PP) is obligatory for anyone earning more than CHF 20,880.-- per annum.


Besides the AVS and 2nd pillar, there are still private provision, the 3rd Pilliar.

 

For more information, please visit the sites of the following institutions:

 

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What insurance coverage must an NGO have?

 

The most important is third-party liability coverage (RC), which is mandatory. An organisation’s RC covers, in principle, the risk of damage to third parties due to operations, premises, faulty products, etc.

 

An extension of RC coverage for a particular event can be requested or included in the policy.

 

An NGO is free to choose complementary insurance, which is not mandatory:

 

For more information, you should contact the the Swiss Association Insurance. You may also consult the chapter regarding the responsability and guide of social insurance on the website of the Federal Social Insurance Office (FSIO).

 

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How to protect the name, abbreviation and logo of a  Swiss NGO?

The name, the abbreviation and the logo are considered as a mark. A trade mark is not protected unless it is registered as a trade mark. The administration and registration of Swiss marks depend on the decision of the Federal Institute of Intellectual Property (IPI).

 

WIPO GOLD is a free public resource which provides a one-stop gateway to WIPO’s global collections of searchable IP data. It aims to facilitate universal access to IP information.

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