Opening a Restaurant, Café or Hotel in Geneva: Licence, Diploma and the LRDBHD

The Geneva act and the operating licence

The Geneva framework is the act on catering, the sale of beverages, accommodation and entertainment, of 19 March 2015, in force since 1 January 2016, together with its implementing regulation. Its article 8 sets the principle: operating any business devoted to catering, the sale of beverages or accommodation requires a prior operating licence issued by the department. In practice, the authority that examines and issues is the trade and undeclared work police.

The same article lists the situations that trigger a fresh application, and the list is broader than mere opening: every creation, change of category or location, extension, conversion, change of operator or of owner of the business, or modification of the conditions of the previous licence. A share purchase that changes the real owner, an extended terrace, a shift from café to bar with entertainment are therefore not neutral events.

The procedure begins with an application filed with the department, together with the documents needed to examine it. The department then submits the file, for consultation, to the other authorities concerned, each within its own field of competence. That consultation mechanism explains the real duration of a file: it does not depend on the trade police alone.

Categories of establishment

The act distinguishes several categories, and the choice is not cosmetic: it determines the diploma required, the conditions to be met and the scope of the licence. They include cafés-restaurants and bars, dance venues and cabaret venues, permanent refreshment outlets, limited-service refreshment outlets, association refreshment outlets, and hotels.

Two practical consequences. First, a partial diploma is enough to run a permanent limited-service outlet or an association outlet: a small-format project does not necessarily need the full diploma. Second, one-off events fall under municipal competence, the municipality where the business is located being the authority for that type of operation, a regime distinct from that of a permanent establishment.

Personal conditions applying to the operator

The licence is issued provided the operator meets a set of cumulative conditions, all of which concern the person rather than the business.

• Being a natural person of Swiss nationality, a national of a state with which the Confederation has concluded an agreement on the free movement of persons, or considered a worker in Switzerland under the Foreign Nationals Act.
• Having capacity to act.
• Holding the diploma certifying the ability to operate and manage a business subject to the act, subject to the partial diploma and to exemption.
• Offering, through their record and conduct, every guarantee that the business will be operated in accordance with the act and with the rules on foreign nationals, social security and employment law, as well as the criminal provisions on offences in bankruptcy and debt enforcement; where the operator is an employer, providing an official certificate showing no arrears in contributions.
• Offering every guarantee of personal and effective operation, having regard in particular to residence and availability, and to compliance with the prohibition on using or acting as a front man during the 36 months preceding the application.
• Being designated by the owner of the business, where the operator does not hold that capacity.

The availability condition deserves careful reading: residence and availability are assessment criteria. A candidate who already operates another establishment, or who lives far away, faces closer scrutiny of their ability to ensure effective operation.

The diploma: examinations, exemptions, fees

The diploma is obtained by passing examinations designed to verify that candidates have the knowledge required in the light of the act’s objectives. The department organises those examinations and may delegate operational tasks: in Geneva, the ifage handles that organisation, with two sessions each year.

Preparation is not a state fee. Providers on the official list set their own prices, a full course typically ranging from CHF 1,300 to CHF 2,200 depending on the format. Two forms of relief are provided by law and often forgotten: the partial diploma for limited-service and association outlets, and exemption from all or part of the examinations for holders of an equivalent qualification. An exemption request must be filed before the examination registration deadline; once that deadline has passed, no exemption is accepted.

Company and operator: what the law requires

The act is explicit on three points that shape the legal architecture of the project. The business may be operated only by the person holding the licence. The operator must manage the business effectively, exercising actual control over it, the Council of State setting out the requirements as to presence and responsibilities. Where the operator is temporarily absent, a competent replacement must be appointed and instructed, and that replacement also bears responsibility for the operation.

A broad liability comes with it: the operator answers for the conduct of everyone taking part in running or entertaining in the establishment in the course of their work. And where the operator or the owner is an employer, they must comply with the provisions on social protection of workers and with the working conditions customary in Geneva in their sector, the department being entitled to ask at any time for a formal undertaking to that effect.

Nothing prevents a Sàrl or an SA from owning the goodwill, the lease and the equipment: the act expressly provides for the operator to be designated by the owner of the business where the owner does not operate personally. The line not to cross lies elsewhere: the designated person must genuinely perform the essential tasks. We frame that interface through our company incorporation service in Geneva.

Front men, measures and fines

The sanctions regime goes further than that case. Where an infringement occurs, the department may impose additional training, suspend the operating licence for up to six months, or withdraw it, taking account of the seriousness and any repetition. A business operated without a valid licence is ordered to cease trading immediately and, failing voluntary compliance, the department closes it and affixes seals. In the event of a serious and manifest disturbance of public order, a police commissioner may close the establishment immediately for up to ten days, the department being able to extend the measure to four months.

An administrative fine of CHF 300 to CHF 60,000 may be added, cumulatively with those measures. One point deserves the partners’ attention: where the offence is committed in the management of a legal entity, the penalty applies to the persons who acted or should have acted on its behalf, and the company is jointly liable for the fines.

Three VAT rates and a binding national agreement

A Geneva establishment handles three VAT rates. The standard rate of 8.1% applies to all catering services, alcoholic beverages included. The reduced rate of 2.6% covers food taken away or delivered, alcohol excluded, but only where appropriate organisational measures have been taken to distinguish those supplies from catering; without such measures, the standard rate applies. The special rate of 3.8% covers accommodation, understood as lodging with breakfast even if invoiced separately, and applies until 31 December 2027 at the latest.

That requirement translates directly into the till: separate items for takeaway, receipts that say so, and a written procedure known to staff. Without it, the reduced rate falls away for the entire audited period. Liability starts at CHF 100,000 of turnover, with registration within 30 days.

On the staffing side, the national collective agreement for the Swiss hospitality industry has been declared generally binding by the Federal Council: it applies to every establishment in the sector, member or not. It brings together six social partners, GastroSuisse, HotellerieSuisse and the Swiss Catering Association on the employer side, Hotel & Gastro Union, Unia and Syna on the employee side, and covers roughly 250,000 employees. The 2026 monthly minimums, up by around 0.2%, run from CHF 3,713 without vocational training and CHF 3,943 with a Progresso certificate to CHF 4,528 with a federal VET diploma and CHF 5,293 with a federal professional examination, trainees at CHF 2,390. They take effect on 1 January 2026 for year-round establishments and on 1 May 2026 for seasonal ones. We run that payroll within our general administration service.

Pitfalls of a Geneva project

The first pitfall is signing the lease before holding the diploma. There are two examination sessions a year, the convocation arrives three weeks ahead, marks follow two to three weeks later, and the licence file then goes through consultation with other authorities. Premises paid for while the file progresses cost more than the training itself.

The second is de facto management, the arrangement where the investor runs the business and the diploma holder signs. That is precisely the legal definition of a front man, and the sanction strikes both, plus the company. The third is category drift: a café that becomes a bar with entertainment changes regime and must apply for a new licence. The fourth is a till misconfigured on takeaway, which retroactively turns 2.6% into 8.1%.

The fifth concerns takeovers: the licence does not pass with the goodwill, a change of operator or owner requires a fresh application, and the licence lapses when it has not been used for twelve consecutive months. Taking over premises closed for more than a year means starting from a complete file. As with the electrical company in Geneva, the difficulty is rarely the rule itself: it is the order in which it is executed.

FAQ: opening an establishment in Geneva

Who issues the operating licence in Geneva?

The competent department, through the trade and undeclared work police. The application is filed with the required documents, then circulated for consultation to the other authorities concerned, each within its field. A licence must be applied for on every creation, change of category or location, extension, conversion, change of operator or owner, or modification of the previous conditions.

Can my company hold the licence?

No. The licence is issued to a natural person who must exercise actual control over the establishment. The company may own the goodwill, the lease and the equipment, and the act provides for the operator to be designated by the owner where the latter does not operate personally. But the designated operator must effectively and personally perform the essential tasks, failing which the arrangement is a front man structure.

What are the consequences of a front man arrangement?

Suspension of the diploma for 36 months for the person acting as a front man, withdrawal of the licence and immediate closure of the business, and a 36-month bar on any new application for the front man, the owner of the business and anyone who resorted to the arrangement. An administrative fine of CHF 300 to CHF 60,000 may be added, with the company jointly liable where the offence is committed in its management.

How much does the diploma cost and how often can it be retaken?

The examination fee for the full diploma is CHF 500, and an exemption request costs CHF 80 with no reduction on the examinations sat. Two sessions are held each year and, in the event of failure, the examinations may be retaken twice within a window of five sessions. Preparation courses are not charged by the state: providers on the official list set their own fees.

Is the full diploma required for a refreshment outlet?

No. The act provides that a partial diploma is enough to run a permanent limited-service refreshment outlet or an association outlet. One-off events fall under municipal competence, which is distinct from the licence to operate a permanent establishment. The category should therefore be settled before the file is prepared.

Which VAT rate applies to takeaway?

The reduced rate of 2.6% applies to food taken away or delivered, alcohol excluded, only where appropriate organisational measures distinguish those supplies from catering. Without such measures, the standard rate of 8.1% applies to everything. A till that separates the items, explicit receipts and a procedure known to staff are the evidence expected at inspection.

Sources

• Act on catering, the sale of beverages, accommodation and entertainment (LRDBHD, rsGE I 2 22), of 19 March 2015
• Implementing regulation of the LRDBHD (RRDBHD, rsGE I 2 22.01)
• Canton of Geneva, Applying for a licence to operate a public establishment
• Canton of Geneva, Obtaining the cafetier diploma
• Federal Act on Value Added Tax (SR 641.20), articles 10, 25 and 66
• National collective agreement for the Swiss hospitality industry (CCNT, L-GAV)