{"id":13720,"date":"2026-10-28T09:00:00","date_gmt":"2026-10-28T08:00:00","guid":{"rendered":"https:\/\/my-swiss-company.com\/?p=13720"},"modified":"2026-10-21T15:58:22","modified_gmt":"2026-10-21T13:58:22","slug":"real-estate-developer-switzerland","status":"publish","type":"post","link":"https:\/\/my-swiss-company.com\/en\/real-estate-developer-switzerland\/","title":{"rendered":"Becoming a real estate developer in Switzerland as a foreigner: Lex Koller, off-plan sales, warranties and VAT"},"content":{"rendered":"<div class=\"intro-box\">\n<p>To become a real estate developer in Switzerland when you come from abroad, the first question is not financing, and not the building permit either: it is whether your company is allowed to buy the land. The Lex Koller in principle bars a company controlled by persons abroad from acquiring land to build homes, while leaving it free to develop offices, shops or hotels. Then come the rules that bind the developer once the units are sold: the public deed, the warranty for defects tightened on 1 January 2026, the lien an unpaid subcontractor can register, and a VAT regime that works differently from the rest of Europe. This guide is written for the foreign developer who wants to set up a company in Switzerland, not for the employee looking for a development job.<\/p>\n<\/div>\n<div class=\"table-of-contents\">\n<h3>Contents<\/h3>\n<ol>\n<li><a href=\"#role\">Developer, broker, builder: who does what<\/a><\/li>\n<li><a href=\"#lex-koller\">Lex Koller: the question that decides everything<\/a><\/li>\n<li><a href=\"#commercial-housing\">Commercial property open, housing closed<\/a><\/li>\n<li><a href=\"#settling\">Settling in Switzerland as a foreign founder<\/a><\/li>\n<li><a href=\"#selling\">Selling: public deed and the 2026 warranty<\/a><\/li>\n<li><a href=\"#builders-lien\">The builders&#8217; lien<\/a><\/li>\n<li><a href=\"#vat\">VAT: property sales outside the tax<\/a><\/li>\n<li><a href=\"#company\">Legal form and capital structure<\/a><\/li>\n<li><a href=\"#mistakes\">Costly mistakes<\/a><\/li>\n<li><a href=\"#faq\">FAQ<\/a><\/li>\n<\/ol>\n<\/div>\n<h2 id=\"role\">Developer, broker, builder: who does what<\/h2>\n<p>A property developer in Switzerland buys land or an existing building, obtains the permit to build or convert, finances the project, hires the architects and contractors, then sells the units or the whole building. The developer is both the client on site and the seller, and carries the risk from start to finish. A broker only brings buyer and seller together for a commission, and a construction company carries out the work the developer orders. If building itself is your trade, our guide to <a href=\"https:\/\/my-swiss-company.com\/en\/start-construction-company-switzerland\/\">starting a construction company in Switzerland<\/a> covers what the contractor has to put in place.<\/p>\n<p>No federal licence is required to work as a developer. The federal professional certificate in real estate development and the courses run by the industry associations SVIT and USPI are optional. What frames the business is the law that applies to each project: buying the land, building, selling.<\/p>\n<h2 id=\"lex-koller\">Lex Koller: the question that decides everything<\/h2>\n<p>The Federal Act on the Acquisition of Immovable Property by Persons Abroad, known as the Lex Koller, sets the principle: persons abroad need an authorisation from the competent cantonal authority to acquire property in Switzerland (Art. 2(1)). The authorisation is refused in every case where the property would be a form of capital investment the Act does not allow (Art. 12(a)). Building homes in order to sell them falls into that category.<\/p>\n<p>The trap for a foreign founder is that the Act looks beyond the buyer&#8217;s passport to the company itself. A company with its registered office in Switzerland is treated as a person abroad when persons abroad control it (Art. 5(1)(c)). The Act presumes that control when persons abroad:<\/p>\n<ul>\n<li>own more than a third of the share capital;<\/li>\n<li>hold more than a third of the votes at the general meeting;<\/li>\n<li>have lent the company repayable funds exceeding half of its equity, as the Act calculates it (Art. 6(2)).<\/li>\n<\/ul>\n<p>Where you live matters as much as your nationality. A citizen of the European Union or EFTA who actually lives in Switzerland, or a foreign national with the right to reside permanently there (a settlement permit), is not a person abroad (Art. 5(1)(a) and (abis)). An Italian developer who moves to Lugano and owns her company alone is therefore under a different regime from the same developer running the same company from Milan.<\/p>\n<p>Buying shares does not escape the test either. Acquiring shares in an unlisted company whose real purpose is to hold property counts as acquiring the property itself (Art. 4(1)(e)).<\/p>\n<h2 id=\"commercial-housing\">Commercial property open, housing closed<\/h2>\n<p>The Lex Koller leaves one door wide open: no authorisation is needed when the property serves as a permanent establishment for a business (Art. 2(2)(a)). The Federal Office of Justice, in its instructions to land registry offices, lists what that covers: factories, warehouses, offices, shopping centres, shops, hotels, restaurants, workshops and medical practices. It adds that the business may be run by a tenant, so a person abroad may buy such property purely as an investment.<\/p>\n<div class=\"msc-table-wrap\">\n<table class=\"msc-table\">\n<thead>\n<tr>\n<th>Project of a company controlled by persons abroad<\/th>\n<th>Regime<\/th>\n<th>Reference<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Office building, retail space, hotel, warehouse<\/td>\n<td>No authorisation, checked by the land registry<\/td>\n<td>Art. 2(2)(a) Lex Koller; Federal Office of Justice instructions, 41.1<\/td>\n<\/tr>\n<tr>\n<td>Residential building, houses, apartments for sale<\/td>\n<td>Authorisation refused: prohibited capital investment<\/td>\n<td>Art. 12(a) Lex Koller; Federal Office of Justice instructions, 41.2<\/td>\n<\/tr>\n<tr>\n<td>Building land held for a future project, even in an industrial zone<\/td>\n<td>Prohibited capital investment<\/td>\n<td>Federal Office of Justice instructions, 41.2<\/td>\n<\/tr>\n<tr>\n<td>Homes required by residential quota rules within a commercial project<\/td>\n<td>Allowed by way of exception<\/td>\n<td>Art. 2(3) Lex Koller; Federal Office of Justice instructions, 41.3<\/td>\n<\/tr>\n<tr>\n<td>Purchase of shares in an unlisted property company<\/td>\n<td>Treated as buying the property<\/td>\n<td>Art. 4(1)(e) Lex Koller<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p class=\"msc-caption\">Sources: Lex Koller (SR 211.412.41); Federal Office of Justice, instructions to land registry offices on the acquisition of property by persons abroad, 1 July 2009 (French).<\/p>\n<\/div>\n<p>The instructions are explicit on the point that surprises developers most. Before entering the purchase, the land registry checks that the buyer is not acquiring homes (detached houses, rental buildings, apartments) and does not plan to build any, exceptions aside. Holding building land in reserve is a prohibited pure capital investment, even when the land lies in an industrial or commercial zone rather than a residential one (instructions, 41.2). A foreign-controlled developer can put up an office building, but cannot bank a plot for later.<\/p>\n<p>Do not try to work around these rules through a nominee, a trust arrangement or disguised financing. The Act refuses authorisation to anyone who has attempted to circumvent it (Art. 12(c)), and a purchase concluded without the required authorisation has no effect, then becomes void if authorisation is refused (Art. 26). The only sound route is to structure the company correctly from the outset, with specialist advice, or to focus on commercial property.<\/p>\n<h2 id=\"settling\">Settling in Switzerland as a foreign founder<\/h2>\n<p>An EU or EFTA citizen who moves to Switzerland to work on a self-employed basis receives a residence permit valid for at least five years, provided they show they are settling for that purpose (Agreement on the Free Movement of Persons, Annex I, Art. 12). A citizen of any other country is admitted only if the project serves the interests of the Swiss economy and the financial and operational requirements are met (Art. 19 of the Foreign Nationals and Integration Act). Whatever your nationality, the Code of Obligations requires that your GmbH or AG &#8220;must be able to be represented by a person who is resident in Switzerland&#8221; (Art. 814(3) and 718(4) CO).<\/p>\n<p>For a developer, your place of residence therefore works twice: it determines your right to stay, and it changes how the Lex Koller classifies your company.<\/p>\n<div class=\"msc-cta-inline\">\n<p class=\"msc-cta-kicker\">Your property development company in Switzerland<\/p>\n<p class=\"msc-cta-title\">A structure designed before the land is bought<\/p>\n<p>Choice of canton and legal form, split of capital and votes, incorporation and commercial register entry, resident director, project-by-project accounting, VAT and year-end closings: My Swiss Company SA incorporates and administers your development company from Geneva, Lucerne or Zug.<\/p>\n<p>    <a class=\"msc-cta-btn\" href=\"https:\/\/my-swiss-company.com\/en\/contact\/\" target=\"_blank\" rel=\"noopener\">Scope your project<\/a><br \/>\n    <span class=\"msc-cta-note\">Swiss Corporate Services Provider in Geneva, Lucerne and Zug, serving clients in more than 20 countries.<\/span>\n<\/div>\n<h2 id=\"selling\">Selling: public deed and the 2026 warranty<\/h2>\n<p>Under Swiss law, &#8220;a contract for the sale of immovable property is valid only if done as a public deed&#8221; (Art. 216(1) CO). A preliminary contract and any right of pre-emption, purchase or repurchase must take the same form (Art. 216(2) CO). A reservation agreement signed privately with a buyer does not validly bind either side, which matters for any off-plan sale in Switzerland.<\/p>\n<p>Since 1 January 2026, the warranty owed by the seller of property has been tightened, and developers are its first target. The new Art. 219a CO, introduced by the Federal Act of 20 December 2024 on construction defects, provides that &#8220;the period for reporting defects when purchasing immovable property is 60 days&#8221;, counted from discovery for hidden defects, and that &#8220;an agreement on shorter periods is invalid&#8221; (Art. 219a(1) CO). The buyer of property with a structure &#8220;that has yet to be built or was newly built less than two years prior to the sale may also demand rectification free of charge&#8221;, under the rules on contracts for work (Art. 219a(2) CO). The buyer&#8217;s rights prescribe five years after acquiring ownership, and that period may not be shortened to the buyer&#8217;s detriment (Art. 219a(3) CO).<\/p>\n<div class=\"conseil-msc\">\n<h4>My Swiss Company&#8217;s view<\/h4>\n<p>Align your construction contracts with your sale contracts. If you must repair defects in an apartment sold off-plan for five years, your contractors should guarantee you at least as long and on the same reporting periods. Any gap between the two leaves the risk on your company&#8217;s balance sheet.<\/p>\n<\/div>\n<h2 id=\"builders-lien\">The builders&#8217; lien<\/h2>\n<p>The Civil Code protects those who build, sometimes at the developer&#8217;s expense. Tradesmen and building contractors who have supplied labour and materials may register a statutory lien on the property they worked on, &#8220;whether the debtor is the owner of the property, tradesman or building contractor&#8221; (Art. 837(1)(3) CC). A subcontractor your general contractor failed to pay can therefore encumber your land even though you settled the general contractor&#8217;s invoice in full.<\/p>\n<p>The application for entry &#8220;must be made within four months of completion of the work&#8221; (Art. 839(2) CC), and &#8220;the beneficiary may not waive such statutory mortgage rights in advance&#8221; (Art. 837(3) CC). The lien is not entered if the owner provides adequate security for the claim (Art. 839(3) CC). For a developer selling units, a lien registered at the wrong moment blocks a signing at the notary&#8217;s office, so checking payments down the subcontracting chain is part of the job.<\/p>\n<h2 id=\"vat\">VAT: property sales outside the tax<\/h2>\n<p>The VAT Act exempts the transfer and creation of rights in rem in immovable property (Art. 21(2)(20)). A developer may opt to tax certain exempt supplies, but not where the buyer uses or intends to use the property exclusively for residential purposes (Art. 22(2)(b)). On a housing project, the VAT paid on construction work therefore becomes, in principle, a cost of the project.<\/p>\n<p>The line between selling a property and supplying taxable construction work depends on how the contract is drafted and when it is signed relative to the works. Have it confirmed by a specialist before you sign your first deeds. Gains on resale fall under the cantonal real estate gains tax or the profit tax, depending on the canton and the structure, a point best settled when you choose the canton of the registered office.<\/p>\n<h2 id=\"company\">Legal form and capital structure<\/h2>\n<p>Development projects involve large sums and bank guarantees. The AG, with CHF 100,000 of share capital of which at least CHF 50,000 is paid up, is the most common choice. A GmbH, with CHF 20,000 fully paid up, can carry a modest first project. Our guide to <a href=\"https:\/\/my-swiss-company.com\/en\/incorporation-of-a-company-in-switzerland\/\">company incorporation in Switzerland<\/a> walks through the steps.<\/p>\n<p>For a foreign founder, the split of capital, votes and shareholder loans is not a detail of the articles of association: under the Lex Koller, it decides whether the company may buy residential land. It has to be settled before incorporation, not at the notary&#8217;s office.<\/p>\n<h3>A worked case: a US investor and a Zurich partner<\/h3>\n<p>A New York investor and a Swiss partner who lives in Zurich set up an AG in Zurich to develop a five-storey office building near a suburban railway station. The investor holds 70% of the shares and the partner 30%. With more than a third of the capital in the hands of a person abroad, the company is presumed foreign-controlled, which does not matter for this project: offices are a permanent establishment, so no authorisation is needed, and the land registry only checks that no homes are planned. The partner sits on the board and gives the AG the Swiss-resident representative the Code of Obligations requires.<\/p>\n<p>Two ideas from the first business plan had to go. Adding four apartments for sale on the top floor would have turned part of the project into a prohibited investment, unless a residential quota rule imposed them. And buying the neighbouring plot for a second phase in five years&#8217; time would have meant holding building land in reserve, which the Federal Office of Justice treats as prohibited even in a commercial zone. The partners also counted the investor&#8217;s shareholder loan, because repayable funds above half of the equity create a presumption of control on their own.<\/p>\n<h2 id=\"mistakes\">Costly mistakes<\/h2>\n<ul>\n<li><strong>Signing a preliminary contract for land<\/strong> before checking the company&#8217;s status under the Lex Koller.<\/li>\n<li><strong>Buying land in reserve<\/strong> for a future project, which the Act treats as a prohibited investment.<\/li>\n<li><strong>Selling off-plan on a simple reservation agreement<\/strong>, without a public deed.<\/li>\n<li><strong>Giving buyers a longer warranty<\/strong> than the one obtained from contractors.<\/li>\n<li><strong>Paying the general contractor without checking<\/strong> that subcontractors are paid, then discovering a builders&#8217; lien.<\/li>\n<li><strong>Calculating the margin on a housing project<\/strong> on the assumption that VAT on the works will be recovered.<\/li>\n<\/ul>\n<section id=\"faq\">\n<h2>FAQ: becoming a real estate developer in Switzerland<\/h2>\n<div class=\"question\">\n<h3>Can a foreigner be a property developer in Switzerland?<\/h3>\n<p>Yes, no licence is required to work as a developer. However, a company controlled by persons abroad cannot buy land to build homes, because the Lex Koller treats it as a prohibited capital investment (Art. 12(a)). It can develop commercial property: offices, shops, hotels, warehouses.<\/p>\n<\/div>\n<div class=\"question\">\n<h3>Can a foreign-controlled company buy building land?<\/h3>\n<p>Only to use it for a business activity in the short term. The Lex Koller presumes foreign control above one third of the capital or votes (Art. 6(2)). According to the Federal Office of Justice, holding building land in reserve, even in an industrial zone, is a prohibited capital investment.<\/p>\n<\/div>\n<div class=\"question\">\n<h3>What warranty does a developer owe since 2026?<\/h3>\n<p>The buyer has 60 days to report a defect, and for a building yet to be built or completed less than two years before the sale, can demand rectification free of charge (Art. 219a CO, in force since 1 January 2026). The buyer&#8217;s rights prescribe five years after the transfer of ownership.<\/p>\n<\/div>\n<div class=\"question\">\n<h3>Can an unpaid subcontractor register a lien on the developer&#8217;s land?<\/h3>\n<p>Yes. Tradesmen and building contractors may register a statutory lien on the property even when their debtor is the general contractor (Art. 837(1)(3) CC), within four months of completing the work. The developer can avoid the entry by providing adequate security.<\/p>\n<\/div>\n<div class=\"question\">\n<h3>Is the sale of a new home subject to VAT?<\/h3>\n<p>No. The transfer of property is exempt from VAT (Art. 21(2)(20) of the VAT Act), and opting for taxation is not possible when the buyer uses the property for housing. The line with taxable construction work should be checked before signing.<\/p>\n<\/div>\n<div class=\"question\">\n<h3>Which legal form suits a development company?<\/h3>\n<p>The AG is the most common, with CHF 100,000 of capital of which CHF 50,000 is paid up. A GmbH, with CHF 20,000, is enough for a modest first project. For a foreign founder, the split of capital and votes matters more than the form, because of the Lex Koller.<\/p>\n<\/div>\n<\/section>\n<section id=\"sources\">\n<h2>Sources<\/h2>\n<ul>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/1984\/1148_1148_1148\/en\" target=\"_blank\" rel=\"noopener\">Federal Act on the Acquisition of Immovable Property in Switzerland by Foreign Non-Residents (Lex Koller), SR 211.412.41<\/a><\/li>\n<li><a href=\"https:\/\/www.bj.admin.ch\/dam\/fr\/sd-web\/BcDacmrqDb8y\/weisung-grundstueckerwerb-ausland.pdf\" target=\"_blank\" rel=\"noopener\">Federal Office of Justice, instructions to land registry offices on the acquisition of property by persons abroad, 1 July 2009 (French)<\/a><\/li>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/27\/317_321_377\/en\" target=\"_blank\" rel=\"noopener\">Code of Obligations (CO), SR 220, Art. 216, 219a, 718 and 814<\/a><\/li>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/24\/233_245_233\/en\" target=\"_blank\" rel=\"noopener\">Swiss Civil Code (CC), SR 210, Art. 837 and 839<\/a><\/li>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/2009\/615\/en\" target=\"_blank\" rel=\"noopener\">Federal Act on Value Added Tax (VAT Act), SR 641.20, Art. 21 and 22<\/a><\/li>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/2002\/243\/fr\" target=\"_blank\" rel=\"noopener\">Agreement on the Free Movement of Persons, SR 0.142.112.681, Annex I (French)<\/a><\/li>\n<li><a href=\"https:\/\/www.fedlex.admin.ch\/eli\/cc\/2007\/758\/en\" target=\"_blank\" rel=\"noopener\">Federal Act on Foreign Nationals and Integration, SR 142.20, Art. 19<\/a><\/li>\n<\/ul>\n<\/section>\n<div class=\"conclusion-box\">\n<h2>Conclusion<\/h2>\n<p>Becoming a real estate developer in Switzerland from abroad starts with a check most guides skip: the Lex Koller, which closes housing to companies controlled by persons abroad and leaves commercial property open. Then come the public deed, the warranty tightened in 2026, subcontractors&#8217; liens and a VAT regime that weighs on housing projects. My Swiss Company, a Swiss Corporate Services Provider in Geneva, Lucerne and Zug, helps entrepreneurs from more than 20 countries incorporate and run their companies, from the capital structure to the accounts of each project.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>To become a real estate developer in Switzerland when you come from abroad, the first question is not financing, and not the building permit either: it is whether your company is allowed to buy the land. The Lex Koller in principle bars a company controlled by persons abroad from acquiring land to build homes, while [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":13736,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","inline_featured_image":false,"footnotes":""},"categories":[30,9],"tags":[],"class_list":["post-13720","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-company-formation","category-creation-dentreprise"],"rank_math":{"rank_math_title":"Real Estate Developer in Switzerland: A Guide for Foreigners","rank_math_description":"Real estate developer in Switzerland from abroad: Lex Koller, housing closed and commercial open, the 2026 defects warranty, builders' lien and VAT.","rank_math_focus_keyword":"real estate developer in Switzerland"},"_links":{"self":[{"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/posts\/13720","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/comments?post=13720"}],"version-history":[{"count":1,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/posts\/13720\/revisions"}],"predecessor-version":[{"id":13721,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/posts\/13720\/revisions\/13721"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/media\/13736"}],"wp:attachment":[{"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/media?parent=13720"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/categories?post=13720"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/my-swiss-company.com\/en\/wp-json\/wp\/v2\/tags?post=13720"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}