Authentic deed: how does it work?
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In Switzerland, an authentic deed is a legal document drawn up by a public officer, which formalises the obligations of both parties – in the context of a real estate transaction, those of the seller and the buyer. The authentication of the sale contract is therefore a fundamental step, as it ensures the legal security of the transaction and guarantees that the transfer of ownership complies with current legislation. However, it can also apply to a preliminary sale agreement, with different implications. What should you know about the authentic deed? FGP Swiss & Alps gives you the keys to understanding it.
What is an authentic deed in the context of a real estate sale in Switzerland?
From a legal perspective, an authentic deed must always be drawn up in the presence of a public officer: in the French-speaking cantons (Vaud, Geneva, Fribourg, Valais, Neuchâtel, Jura), this is a licensed notary, and the choice of notary is free. The authentic form ensures that the sale of a house or apartment is legally valid, guarantees the legality of the contract, and protects both parties.
It is important to note that the authentic deed can apply both to a sale contract and to a preliminary sale agreement:
- In the case of a sale contract, the authentic deed is a legal requirement that validates the transaction and authorises the transfer of ownership (except in the specific case of real estate companies, where the sale takes place through a transfer of shares). In addition, the notary registers the new owner in the land register, an essential step for the transfer of ownership.
- In the case of a preliminary sale agreement (pre-contract), authentication is optional. Ownership is not immediately transferred: the preliminary agreement sets out the obligations of the parties, may include suspensive conditions, and commits both the seller and the buyer to conclude a future sale contract, which itself will be subject to authentication.
In short, drafting an authentic deed is essential for a real estate sale to be legally valid. Both parties (seller and buyer) confirm their agreement on all the terms of the transaction. Moreover, authentication carries significant legal weight (particularly regarding the date of execution of the contract) and allows each party to assert their rights if necessary: It is considered legally enforceable, like a court judgment.
What information must be included in an authentic deed of sale?
Since the authentic deed is a legal document, it must contain a certain number of mandatory details to comply with regulations. These details concern both the contracting parties (seller and buyer) and the property subject to the transaction:
- Identity and address of each contracting party.
- Designation of the property: most often, the legal term used is “immovable property”, whether it is a house, a condominium unit, a building with several apartments, or a plot of land. The notary generally attaches a copy of the land register extract.
- Description of the property: address, land area, cadastral number, building insurance number (if available), condition at the time of transfer (for an existing property), or construction description (for a new property).
- Type of transaction: direct sale or deferred sale (with pre-emption right). In the latter case, the actual transfer takes place at a later date than the signing of the preliminary contract.
- Sale price and the payment terms (including deposits and instalments where applicable). In a deferred sale, a 10% deposit is usually required from the buyer, customarily in Switzerland.
- Seller’s obligation to transfer ownership and buyer’s obligation to pay the agreed amount.
- Date of transfer of ownership.
- Any existing easements, as recorded in the land register.
- Taxes and duties payable by the seller (notably the real estate capital gains tax following the sale).
- Legal consequences in the event of default by either the seller or the buyer.
In practice, the notary is responsible for drafting the deed of sale and sending it to the parties for review. Both the seller and the buyer are entitled to request amendments. Once all parties agree, the public officer sets a date for signing.
How does the signing of an authentic deed take place at the notary’s office?
The signing of an authentic deed follows a well-defined process. Here is how it unfolds in the notary’s office:
- The contracting parties (seller and buyer) meet at the notary’s office.
- The notary reads the contract aloud in its exact terms. The parties may interrupt to ask questions or make comments.
- Once everything is clarified, the parties and the notary sign the document. Only one original authentic deed is signed. In the case of a sale contract, the transaction is then sealed and legally valid. Once the property is registered in the land register by the notary, the transfer of ownership is finalised, and the notary transfers the funds to the seller.
It should be noted that the signing of the authentic deed entails costs:
- Notarial fees, payable by the buyer, vary depending on the canton: generally between 0.5% and 0.6% of the sale price in the cantons of Bern, Geneva, Jura, Neuchâtel, Ticino, Valais and Vaud.
- Land register fees, also variable, are usually paid by the buyer and are included in the overall purchase costs (such as transfer duties).
In conclusion, the authentic deed is an essential step in any real estate transaction in Switzerland, whether it concerns the signing of a final sale contract or the validation of a preliminary agreement.
Frequently asked questions about the authentic deed in Switzerland
What is an authentic deed in the context of a real estate sale?
An authentic deed is a legal document drafted and signed before a notary (or another authorised public officer) that formalises the obligations of the seller and the buyer. It guarantees the legal validity of the transaction and secures the transfer of ownership.
Is the authentic deed mandatory in Switzerland?
Yes. For a final real estate sale, the authentic deed is a legal requirement: without it, the transaction cannot be considered valid. However, in the case of a preliminary sale agreement, authentication remains optional.
What information must be included in an authentic deed?
An authentic deed of sale must contain several mandatory elements:
- The identity and address of the contracting parties.
- The designation and description of the property (address, surface, cadastral number, extract from the land register).
- The type of transaction (direct sale or deferred sale).
- The sale price and the payment terms (deposits, instalments).
- Any existing easements and the tax obligations (such as capital gains tax).
- The legal consequences in case of default by either party.
How does the signing of an authentic deed take place?
The signing process is strictly regulated:
- The buyer and seller meet at the notary’s office.
- The notary reads the deed aloud, in its exact terms.
- Once validated, the parties and the notary sign the single original.
- The notary registers the property in the land register and transfers the funds to the seller.
What are the costs associated with an authentic deed?
- Notarial fees, paid by the buyer, vary depending on the canton (on average between 0.5% and 0.6% of the sale price).
- Land register fees are added and are also borne by the buyer, often grouped together with transfer duties.
Why is the authentic deed essential in a real estate transaction?
Because it gives the transaction a legal force equivalent to an enforceable judgment, protects both parties, and officially validates the transfer of ownership in full security.
