KNOWLEDGE BASE

KEY CORPORATE FEATURES

GENERAL INFORMATION

The Netherlands, generally known as Holland, is situated at the estuaries of the Rhine and the Mass and is bordered by Germany in the East and Belgium in the South. The country is small and just 37,000 square Kilometres with almost all of the coastal areas below sea-level, the highest point only being 320 meters above sea level. The capital of the Netherlands is Amsterdam. The Hague is the seat of the Dutch Government. Rotterdam is the largest port in the world.

Population

The population of the Netherlands is approximately 16 million, with the majority of these living in the west of the country.

Political Structure

The Netherlands is a constitutional monarchy, but political power rests with a democratically elected parliament and is based on a written constitution safeguarding individual liberties. The Netherlands is a member of the EU, OECD, the GATT, the International Monetary Fund, the World Bank, The United Nations and the North Atlantic Treaty Organisation.

Infrastructure and Economy

A leading international trading centre since the 16th century, the Netherlands is within easy reach by land, sea and air of the 300 million people in the European market. Due of its location, it has an impressive transportation infrastructure and has become a favoured site for international companies in a wide range of industries, particularly for warehousing and distribution.

The Netherlands has a free-market economy and is one of the richest nations in the world. Dutch prosperity has always been based on international trade and industry. The country also benefits from rich agricultural land; much of it reclaimed from the sea and significant natural gas resources. Financial services, as well as the transportation and distribution sectors, are also particularly significant. Trade is critical to the Netherlands; both exports and imports account for more than 50% of GDP.

Language

The official and spoken language is Dutch. However most people also speak English and German.

Currency

The Euro €.

Exchange Control

Virtually no exchange controls are imposed in the Netherlands although formal reporting requirements are required by the Central Bank these are mainly for statistical purposes.

Type of Law

Civil Law.

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NETHERLANDS COMPANY INFORMATION

Principal Corporate Legislation

Commercial Code of the Netherlands

The Flex-BV Act 2012

Procedure to Incorporate
  • A Public Notary is provided with the information and documentation in order to prepare the draft Articles of Association which are then filed with the Dutch Ministry of Justice.
  • Before the actual incorporation can take place the Duty Ministry of Justice must first issue a “Certificate of No Objection”.
  • Upon receipt of the “Certificate of No Objection” the notary executes the Articles of Incorporation
  • The newly incorporated BV must then be registered in the Trade Registry of the Chamber of Commerce.

The deed and articles are prepared in Dutch but an English translation can be obtained.

Restrictions on Trading

Yes, specified groups, which include for example, banking, insurance, financial services, consumer credit related services and employment agencies.

Powers of Company

A Company incorporated in the Netherlands has the same powers as a natural person.

Language of Legislation and Corporate Documents

Dutch.

Registered Office Required

Yes, must be maintained in the Netherlands.

Shelf Companies Available

No.

Time to Incorporate

Three to Four weeks.

Name Restrictions

A name that is similar to or identical to an existing company. A well-known name that is known to exist elsewhere. A name that implies illegal activities. A name, which in the opinion of the Registrar is considered undesirable, obscene or offensive. A name that implies royal or government patronage.

Language of Name

The name of the company can be expressed in any language using the Latin alphabet. The Registrar may request a Dutch or English translation to ensure that the proposed name does not contravene name restrictions.

Names Requiring Consent or a Licence

Bank, building society, savings, loans, insurance, assurance, reinsurance, fund management, investment fund, trust, trustees, Chamber of Commerce, co-operation, council, municipal or their foreign language equivalents or any name in English or a foreign language that may suggest association with the banking or insurance industries.

Suffixes to Denote Limited Liability

Besloten Vennootschap (BV) and the new Flex-BV.

Disclosure of Beneficial Ownership to Authorities

No, although if the company has a single shareholder this is a matter of public record.

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NETHERLANDS COMPLIANCE

Authorised and Issued Share Capital

From 1st October 2012 the minimum authorised share capital is Euro 1 cent and the share capital can be denominated in any currency.

Classes of Shares Permitted

Registered shares with restrictions on their transferability.

From 1st October 2012 the following changes will apply:

  • Shares with no or limited entitlement to distributions are permissible
  • Shares with or without voting rights are permissible
  • Share transfer restrictions are no longer mandatory
  • Bespoke transfer restrictions, as agreed between shareholders, may be included in the articles.
Taxation

Taxation is paid by companies in the Netherlands based upon annual accounts, which are submitted to the Dutch tax authorities at the end of the company's financial year. A company is free to choose its own year-end.

Corporate Tax Rates are:

  • 20% for taxable income up to €200,000
  • 25% for taxable income above €200,000

Dividends are subject to withholding tax at 15%.

Value Added Tax

From 1st October 2012 the standard VAT rate will increase from 19% to 21%.

Double Taxation Agreements

The Netherlands is party to more than 95 double tax treaties.

Licence Fee

None.

Annual Return

An Annual Return which provides details of those who have held shares throughout the year and the current directors must be filed each year.

Financial Statements Required

All Dutch companies are required to file accounts with the Chamber of Commerce. There is a requirement for Dutch private limited companies to be audited if it meets two of the following three requirements;

  • Assets greater than Euro 6m,
  • Turnover greater than Euro 12m,
  • And average number of employees greater than 49.
Directors

One. They may be natural persons or bodies corporate. They may be of any nationality and need not reside in the Netherlands but in order to obtain relief under the taxation treaties signed by The Netherlands it is likely that the company would need to be seen to be Dutch resident and therefore have a majority of the directors based in The Netherlands.

Company Secretary

Not applicable.

Shareholders

The minimum number of shareholders is one.

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HOW TO PROCEED

A bespoke 'offshore' solution can be complex and requires careful planning and execution. We therefore encourage our clients to contact us directly, without obligation, for a Free Initial Consultation.

Our experienced consultants will gladly assist with advice on how to approach your particular challenge.

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