Incorporate a company
LEGAL FORMS
The legal form of your company determines the liability of the entrepreneur, the financial risks and the type of tax you will have to pay. The most common legal forms for a company in The Netherlands are:
1. One-man-business / sole trader (“Eenmanszaak”)
There is only one owner. There is no distinction between your personal assets and your company assets. This means that your creditors may put a claim your personal assets and on the assets of your partner’s assets as well, unless you are married under marriage settlements.
2. Limited partnership (“VOF”)
There are two or more owners. Still there is no distinction between your personal assets and your company assets. The partners are jointly and severally liable for the legal obligations of the VOF.
3. Private limited liability company (“BV”)
Most of the companies are incorporated in a private limited liability legal form. This legal form involves a legal person, which means that the company have its own rights and bears its own responsibilities. The capital is divided into shares, which are not freely transferrable. The shareholders are mentioned by name and are only liable for the invested amount. The creditors may not put a claim on the personal assets of the shareholders. The BV can be seen as the equivalent of the German “GmbH”, the English “Ltd” and the American “LLC”.
INCORPORATE A BV – THE PROCEDURE
The Dutch Civil Notary shall have to prepare a draft of the Articles of Association, in which several essential issues are stipulated like, the amount of the issued and paid up capital, the name of the incorporator, the representing authorities etc. The Dutch Civil notary will register the BV i.o., this means “BV to be incorporated” with the Trade Register of the Camber of Commerce. The Civil Notary will file all documents to the Dutch Ministry of Justice in order to obtain the “Certificate of No Objection”, for which the identity and historical background of the incorporators and directors will be screened. Those who have a criminal record of have been involved in earlier bankruptcy might be denied. The Certificate of No Objection is valid for three months. During these three months, a bank account must be opened in order to transfer the minimum paid up capital of € 18,000 (eighteen thousand euro). After the confirmation of the bank that the (minimum) capital is available on the bank account, the Articles of Associations can be executed and the “BV i.o.” will become a “BV” and can such be registered in the Trade Register of the Chamber of Commerce. The procedure of incorporation takes about 2-4 months in case one of the shareholders is located from outside the EU.
It is possible that the shareholder of the BV is not a person, but a legal entity, for example a Chinese Mother company who incorporate a 100% daughter in the Netherlands. In such cases the Chinese Mother company must apply for a “Certificate for Overseas Investment” in China as well. After having completed the incorporation of the BV, this Chinese Mother company can transfer employee(s) to The Netherlands in order to build up the business in The Netherlands.
The Netherlands has a competitive corporate tax regime that stimulates entrepreneurship and foreign investment in The Netherlands.
