A sole proprietorship is also called a one-man business or sole trader. Registering such a business guarantees your full independence as its owner and founder. The proprietorship can have more members working for it and employ staff, but its owner is only one.

Establish a Sole Proprietorship in the Netherlands

A sole proprietorship can be established without a deed prepared by a notary. It is mandatory, however, to register the business at the Trade Registry. Each private individual can establish only one sole proprietorship, but the proprietorship can have several trade names and perform various activities using the different names. These business operations can be performed at the registered address or at a branch of the sole proprietorship located elsewhere.

Company liability

The owner of a sole proprietorship carries the responsibility for everything relevant to the enterprise, i.e. all its legal acts, liabilities and assets. The law makes no distinction between business and private property. Therefore business creditors are free to require the recovery of any debts from personal property and vice versa – private creditors can require recovery from business property. In case the proprietorship faces bankruptcy its owner goes bankrupt as well. In case the owner is married under a regime of common property, the creditors are also eligible to claim the spouse’s property. Spouse liability may be avoided through an agreement prepared by a Latin notary and concluded before or after the marriage. Spouses, however, are generally asked to co-sign loan-related documents and the mentioned agreement may fail to provide the expected protection. Our agents in company incorporation can help you with further details regarding liability.

In order to decrease liability risk, many sole traders change their company type to a limited liability company, also known as B.V. Read our article: Establishing a Dutch company: Sole Proprietorship or B.V. 

Tax & social security

For taxation purposes, the profit of sole proprietorships is considered as income. If the Tax Service considers the owner an entrepreneur, then he is entitled to investment, entrepreneurship and retirement allowances. The owner is not entitled to benefits for sickness, income and work, and unemployment insurance. It is best to cover such risks by taking out insurances. Sole proprietorship owners can use any of the national schemes for insurance listed below:

Tax & social security

With sole proprietorship, the law makes no distinction between business and private property. If the owner of the sole proprietorship dies, both his/her private and business property will be inherited by the heirs. It is advisable to ensure the continuity of your business in advance. Our tax experts can give you more information on the matter. Our experienced incorporation agents can consult you on company formation Netherlands.

Characteristics of the Dutch Professional Partnership

In the context of the Dutch law, the “maatschap” or professional partnership is different from the other forms of partnership (general and limited) as it represents a cooperation of professionals, e.g. accountants, physicians, lawyers, dentists or accountants, and its main goal is not the joint performance of business activities. The partners in this form of cooperation are called “maten”. Each “maat” participates in the partnership by contributing personal assets, effort and/or capital. The aim of the cooperation is sharing both the earned income and the incurred expenses.

Establishing a Professional Partnership in the Netherlands

For the establishment of professional partnerships, the law does not require the conclusion of a contract between the partners. However, it is in the partners’ best interests to draft an agreement. The partnership agreement can include provisions related to:

• the contributions made by each partner;
• the profit distribution proportionally to the contributions (it is not possible to transfer all profits to a single partner);
• the distribution of powers: all partners can act as managers unless agreed otherwise. Since July, 2008, professional partnerships need to be listed in the Commercial Registry. This requirement is not relevant to internally acting partnerships, e.g. where expenditures are pooled together.

Partnership liability

Authorized partners can sign contracts binding the whole partnership. Each of the partners may be held equally responsible. Generally, if a partner acts beyond his authority, the remaining partners are not liable for his actions. Only the responsible partner is held liable. Professional partnerships do not have a capital that is separate from the partners’ personal assets. Creditors with claims towards the partnership may seek recovery of a proportionate part from each partner; such creditors are not ranked above ones with claims on the personal assets of any partner. Married professional partners are in the same position as general partners in VOFs or CVs. It is in their interest to conclude pre- or postnuptial agreements. Read more on Dutch bankruptcy law.

Social security and tax

Each partner is liable for income tax with respect to his/her share of the profit. If a partner is considered an entrepreneur by the Tax Service, then he/she can receive allowances for entrepreneurship, investment and retirement with deferred taxes. With respect to social security payments the rules for partners – entrepreneurs are the same as the ones for owners of sole proprietorships.

In case you would like to read on the Dutch general partnership click here.

Franchising is a contractual mechanism through which an entity (franchisor) issues a paid license for use of its business practices and systems and/or its commercial name to another entity (franchisee).

Dutch laws on franchise agreements

The Dutch legislation does not address franchise agreements specifically, so the general provisions of the law on contracts and competition applies. Franchising agreements are usually complex and are therefore concluded in writing. One should consider the following common principles when preparing a franchise agreement under the laws of the Netherlands:

1. Franchise contracts are not a subject to specific national regulations.

2. The general Dutch law on agreements stipulates the guiding principle of fairness and reasonableness (“billijkheid en redelijkheid” in Dutch).

3. The party from the Netherlands has to provide information about its business to the Trade Registry (also known as the Commercial Chamber of Commerce).

Obligations and rights of the franchisee / franchisor

The franchisor carries specific obligations of care under the agreement because of the peculiar nature of the franchising mechanism. These obligations include the provision of some assistance and advice to the franchisee. The Dutch legislation does not require mandatory disclosure of pre-contractual information. The principles of fairness and reasonableness, however, still apply. As a consequence, the parties are required to take all reasonable measures to prevent the other contracting party to conclude an agreement on the basis of misleading information.

Furthermore, the franchisor does not have to provide exploitation forecasts to the franchisee. Please, keep in mind, that once provided, any information is deemed truthful by the other party. Thus the provision of exploitation forecasts that are overly optimistic or not substantiated by a thorough research of the market may result in franchisor liability.

The law in the Netherlands does not include specific provisions with respect to franchise fees, royalties, clauses to prevent competition, advertising and reporting obligations, so the contracting parties have the freedom to determine the extent of the franchisee’s obligations.

Example case study: Franchise

Some very well known examples of famous franchise chains include big names, such as Starbucks, Mcdonalds, KFC, Subway and Hertz. The big names have been featured in many media, articles, movies and are famous succes stories.

However, how often do we hear about the smaller franchises? The ones that fail, or the ones that never really take off?

One such example is Taxexpertz. Which was a small franchise chain for tax preparation that started in 2014 in the United States. The cost for startup of one branch was around 50.000 USD. Taxpertz is not an active franchise anymore, and halted its operations.

To start a Taxexpertz is a fraction of the cost of opening a McDonalds, which is between 1.000.000 USD and 2.200.000 USD for the initial investment (2019).  As well as a franchise fee of 45.000 USD per year, and a service fee of 4% of the sales turnover.

What is the difference between these two concepts? Why did McDonalds conquer the globe? Despite much higher investments?

Learning curve
The learning curve of managing a McDonald is arguably much lower than that of a Taxexpert. The relevant tax legislation in each state, country and year has to be known by the franchisees.

Quality management
Because of the specific knowledge required for each Taxexpertz branch, the managements task to create some uniform quality level, and build an expert name is much more difficult.

In the accounting and tax branch, we have seen that all multinationals in the big 4 are partnerships, not franchises.

Perhaps this indicates that it is much easier to work with a central structure in expert branches.

Brand name

With Mcdonalds, you are investing currently in a well known concept, a brand name that every household in (at least) the Western World knows. You are guaranteed to have a steady amount of customers. You profit from the collective marketing budget of McDonalds.

Succes rate
You can reliably predict beforehand how the franchise will perform. The franchise organisation will have market research statistics, branding, supply contracts and branding in place. Your succes with opening a Mcdonalds is nearly guaranteed before you even install the first grill.

Keep in mind before starting a franchise, what does the franchise bring to the table. And does it provide enough value for your business to succeed.

Agreement termination under the Dutch law

The contracting parties are free to determine the grounds on which agreement termination is allowed. If they have not drafted any rules for termination, fixed-term agreements cannot be cancelled unless unforeseen circumstances arise. Agreements concluded for indefinite periods can, in principle, be terminated with reasonable advanced notice. The period considered reasonable for advanced notification may vary depending on the particular circumstances.

Annulment is another way to terminate a contract. Art. 6:265 in the National Civil Code states that default by one of the parties gives the other the option to cancel the agreement if the nature of the default justifies annulment. Art. 6:228 of the same Code also gives the option to declare the contract void on the grounds of an error (“dwaling” in Dutch).

It should be noted that even when an agreement is legally terminated some losses may be considered outside of the margins of the franchisee’s acceptable business risk and may require compensation.

In case you have questions regarding franchise agreements under the law of the Netherlands, please, feel free to contact our Dutch law firm. We can assist you with company incorporation, tax preparation and drafting your franchise agreements.

You can also check our article on use and protection of intellectual property in the Netherlands. In the article, you will find information on patents, trademarks, trade names and copyrights in the Netherlands.

The Venootschap Onder Firma (VOF) or General Partnership is a company established by a minimum of 2 members through an agreement registered with the Commercial Chamber (Trade Registry). This entity is commonly translated as “company with partners”. The General Partnership should not be confused with the Professional Partnership which represents cooperations of professionals where the main goal is not the joint performance of business activities.

Main features of the Dutch VOF (General Partnership)

Each of the partners must make a contribution to the common business, e.g. goods, money, labour or knowledge. In contrast to other entities in the country, the VOF is not required to have a minimum capital to operate.

Another important feature of the Dutch General Partnership is connected with the liability of its members. Each involved partner is liable for the company’s debts even when they are created by another partner in the VOF. For this reason, the partnership contract needs to be drafted and concluded in the presence of a notary.

As regards taxes, the contract needs to be submitted to the Commercial Chamber. Each of the partners has to pay income tax with respect to their profit share much like an independent entity. Therefore each partner has separate tax deductions and allowances.

The VOF agreement must state the authority, contributions, shares and resignation arrangements with respect to the profits. It also needs to include a formula for profit allocation. Such contracts can be drafted by a notary or the members of the partnership with the help of a model agreement.

Dutch VOF: Company Liability

The partners in a VOF carry joint and several liability with respect to the debts of the company. If the partnership’s assets are insufficient to cover the debts, creditors have the right to claim its members’ personal assets.

If the partners are spouses with no marriage settlement, creditors have the right to claim the assets of both spouses. If a settlement exists, only the assets of the spouse in debt are considered to fall in the scope of the business. In a business partnership between a husband and wife, both spouses can claim allowances if they undertake to perform equal shares of the tasks.

If you would like to receive further details regarding the Dutch General Partnership, please, contact our local company advisors.

Dutch VOF: Records and accounts

With respect to records and accounts, the Dutch law states that all persons involved in business or exercising independent professions are obliged to keep financial records and accounts and to store documents, books and other information carriers connected to those records and accounts. In a VOF, each partner has to prepare a yearly balance table and a statement of income.

Read here if you would like to explore other company types, such as the sole proprietorship and the private limited company in the Netherlands.

When registering a Dutch company investors have the option to set up either a branch or a subsidiary.

The particular circumstances regarding the interests of the international firm may definitely determine the final choice of legal entity. However certain aspects have to be considered when choosing between a Dutch subsidiary and a Dutch branch.

The general characteristics of Dutch subsidiaries and branches are listed below.

Dutch branches

Branches are permanent establishments forming single entities with the international companies that register them.

This option brings advantages and drawbacks.

Advantages of opening a branch:

• it is fairly easy to incorporate and the involved costs are generally lower;
• remitted earnings are not subject to withholding tax;
• no requirement for publication of the branch’s financial statements (there are exceptions);
• losses of the branch in the Netherlands can be compensated by profits/taxes of the main office;
• no tax for capital registration.

Disadvantages of opening a branch:

• the branch does not have a Dutch identity and functions as an international company;
• the establishing company carries full liability with respect to the obligations and debts of its branch in the Netherlands;
• it may be more difficult to gain the acceptance of the locals due to the branch’s international identity;
• permanent branch establishment may lead to double taxation problems

Read more on Dutch branches.

Dutch subsidiaries

The most important advantage of opening a subsidiary in the Netherlands is that the liability of the shareholder(s) is limited. However other aspects should also be considered. Below is a list of some pros and cons with respect to establishing a subsidiary:

Advantages:

• the liability of the shareholders is limited to their actual contributions to the capital;
• the mother company does not carry liability for its subsidiary in the Netherlands unless specified otherwise;
• the amortization of any intangible asset can be allocated for tax purposes in the Netherlands;
• nationals are likely to prefer conducting business with subsidiaries rather than branches;

Disadvantages:

• more costly and complicated procedure for establishment;
• remitted earnings are subject to withholding tax;
• large and medium companies are required to publish financial results;
• the law requires the company to appoint a director.

Read more on Dutch subsidiaries.

International entrepreneurs are advised to consider the main pros and cons listed above before deciding whether to open a Dutch branch or subsidiary. In case you require further information or support to decide which option is best for you, please, get in touch with our incorporation agents in the Netherlands. If you would like to explore other company types in the Netherlands, please visit our designated article on the Dutch company types.

Dutch notaries are members of the KNB (The Royal Association of Latin Notaries). They provide specific services different from the ones offered by other law practitioners, including attorneys, lawyers and tax advisors. Their most important features are their independence and impartiality. They might also be referred to as Public Notary Netherlands or Notary Public.

Dutch notaries have university degrees in law and some of them specialize in particular areas, e.g. real estate, family or company law. If necessary the notaries can request services of other, more specialized law practitioners, including law firms. Notaries are not able to perform the duties of lawyers; hence they are not allowed to represent people in court. Furthermore, they cannot substitute Dutch attorneys.

Dutch notaries / Junior notaries

Notaries can sign deeds, while junior notaries are not entitled to this authority. Dutch notaries can also have personal offices, but the local law does not recognize them as entrepreneurs, regardless of this fact.

Junior notaries, in principle, are training to become notaries. They are required to complete a certain period of service at a duly accredited notary office. Junior notaries have a university degree in law but may prefer to remain working in accredited offices instead of opening personal offices.

Tasks of the Dutch Public Notary

Notaries act in the interests of parties concluding transactions or agreements. Similar to Dutch medical doctors or attorneys, they are bound by confidentiality clauses that do not allow them to betray their clients.

Notaries draft and execute deeds. They issue the respective papers to the involved parties, while also keeping copies of them in their office. After the preparation of notarial agreements, notaries have to update the respective registers (e.g. for private and public companies, marriage contracts, etc.)

Notaries have expert knowledge in particular fields and therefore may perform the functions of legal advisors. Even though they are unable to perform the services offered by attorneys or lawyers, they can provide advice with respect to signing deeds.

If you plan on signing contracts in the country it is appropriate to first seek professional advice. If you need more information regarding the local legislation or additional counselling, please, call our Dutch law company.

The central location of the Netherlands is one of the many assets that make the country perfect for setting up European and global offices. Holland has long been established as a main trading centre and is popular with its open economy. The country is highly developed and offers many opportunities to companies and people planning to stay or set up a business. There are also other important advantages to establishing a business in the Netherlands.

Dutch people are quite knowledgeable, most of them have a good understanding of English, while many are also fluent in French and German. The high educational standards undoubtedly play a role, but people are also aware that knowing foreign languages gives them a significant advantage in a small open country. Besides, the Dutch are interested in travelling abroad and frequently cross borders. The Netherlands is also multicultural. Amsterdam boasts the greatest variety of nationalities among the world capitals. Furthermore, the financial and political system of the country is perceived as exceptionally stable.

The Dutch tax regulations are comparatively advantageous for international companies and investors opening new businesses. The Dutch community and its government welcome international entrepreneurs. They offer various means of assistance and provide information to facilitate the registration process. Moreover, big cities are not far apart and the infrastructure is excellent. The same is true for the Information Technology infrastructure and the locals are quite good with technology. Finally, the Netherlands is perceived as the perfect test market to introduce new services and products in Europe.

These are just several of the many reasons to choose the Netherlands for establishing headquarters in EMEA, Europe or Benelux. If you would like to receive more information on the opportunities the Netherlands provides, please contact our experts. You can also read here for more information on setting up a business in the Netherlands.

Background information on the Netherlands

The Netherlands is the country’s official name, while Holland includes only two western provinces (South and North Holland) with large cities like Rotterdam, Amsterdam and The Hague.

The form of government in Holland is constitutional monarchy where the sovereign is the Dutch king. The parliament is democratic: headed by a prime minister and composed of representatives of parties voted by the people. The capital, the popular city of Amsterdam, in fact, has only about 750 000 citizens. Rotterdam is the second largest city in the Netherlands. The Hague is where the government is located. It is also the third largest city in the country after the capital and Rotterdam. The Netherlands is famous for its windmills, tulips, wooden shoes and Gouda cheese, as well as for its open policy regarding cannabis and other matters.

The Netherlands is in the global top 10 of the most developed countries. It also ranks sixth in the Index of Human Development. The country is densely populated and has an extensive network of highways, railroads and roads. Its main port, Rotterdam, is among the largest worldwide and its airport, Schiphol, located near Amsterdam, is a major airline hub in Europe. The population of the Netherlands is about 16 500 000. The country shares borders with Germany (east) and Belgium (south). Football is considered the national sport, while field hockey and ice skating are also popular.

It is easy to start a Dutch business, but every entrepreneur has choices to make. First of all, one must choose the legal entity that will operate the business; this determines the taxes he or she will have to pay. The main question is whether to register a Dutch sole proprietorship (one-man company or Eenmanszaak in Dutch) or a BV (limited liability company or besloten vennootschap in Dutch). Which one is better?

To consider to open a Netherlands sole proprietorship, you would need to first be a tax resident in the Netherlands. It is not recommended for foreign residents. The Dutch BV can be opened by a foreign resident.

The difference between a Netherlands sole proprietorship and a BV

The best solution is the one that fits the aims of the business. The Dutch BV is a company with limited liability (LLC). This option is attractive, since, in theory, the responsibility of the company members is restricted. But is this really the case in practice? Is it possible to operate a business without carrying private responsibility for its outcomes? Not according to us. The general conditions with respect to liability insurance may actually even out the differences between the BV and the sole proprietorship.

Having registered as a BV, you show your clients and partners that you own a reliable business, even if you are still operating alone. The sole proprietorship in Netherlands is frequently associated with a business operated by a single person, but this perception is incorrect. The business’ capital is indeed owned by a single person, but the entity may have numerous employees.

The BV has a series of fiscal rules involving the shareholder(s) and managing director(s). They regulate the distribution of salaries, the use of funds and other matters that can reflect significantly on the final tax liabilities.

The sole proprietorship has few rules. The whole profit of the company is subject to tax, but significant credits are available. Therefore an entrepreneur can generate taxable profit of approximately 22 000 EUR per year and be exempt from income tax for the first 3 years after the company’s establishment. Subsequently, the threshold drops to 18 000 EUR. With BVs every earned euro is a subject to tax.

The BV offers more options than the Dutch sole proprietorship. for example, share transfer to another party if the business is sold. No tax on sales is due immediately for holding structures. Loan contracts can be concluded, internal pension obligations can be drafted and so on.

An entrepreneur can always switch from sole proprietorship to a BV in order to sell the company or take advantage of other opportunities.

Many international entrepreneurs establish their businesses in the Netherlands to benefit from the many offered advantages. The strategic location of the Netherlands provides access to many western European customers and the country boasts the biggest port on the continent: Rotterdam. The tax system offers numerous advantages for businesses in various sectors. Below is a description of the top five profitable industries currently suitable for opening a Dutch company.

1. Agriculture

The country is rated second in the global export of agricultural products and foods after the United States, mainly due to the adoption of innovative methods in the field. In 2015 local agricultural producers reported an unprecedented increase in food export reaching almost 82.5 billion Euro. Our lawyers can assist you in applying for the necessary licenses to open a company in the agriculture business.

2. Energy

The Netherlands is the top producer of green energy and gas in Europe. The gas technologies it uses are among the most developed in the world. International investors planning to open businesses in this sector can take advantage of different dedicated governmental programmes. Our Dutch lawyers can provide you with more information on the subsidies offered by the country in the field of energy.

3. Information Technology (IT)

The local legislation is favourable for investors planning to open IT companies in the country. Their businesses can take advantage of different governmental incentives granted in the field of high technology. Our law firm can help you obtain the necessary license for opening an Information Technology company in the Netherlands.

4. Logistics

The huge volume of goods in transport worldwide has had a significant effect on the Dutch logistics sector. Currently, the country is among the most advanced logistic centres on a global scale. Therefore setting up a company operating in the field of logistics will bring significant profits. Our firm can assist you with setting up a logistics company in the Netherlands.

5. Creative sector

The creative industry is turning into a lucrative ground for investment in the country. International entrepreneurs are welcome to open companies operating in the field of architecture, design and online gaming. Our Dutch lawyers can give you details on the requirements for opening such a company.

If you would like to set up a Dutch business, you can get in touch with our local attorneys to receive legal assistance.

The Netherlands is welcoming foreigners intending to work and live on its territory and start private businesses. The country offers an ideal environment for setting up a branch or establishing the headquarters of a big company, but smaller businesses also develop well. The Netherlands is among the European member states where motivated investors and entrepreneurs can set up new businesses with comparatively small initial capital. Below is a list of five sectors suitable for opening a small company:

1. The Dutch food industry

Many people in the Netherlands are too preoccupied to cook at home. Therefore opening a restaurant or an agency for catering is an excellent option for a small business. Food storage, production and sale in the Netherlands require special licenses and permits.

2. Handmade Goods

The production of handmade goods requires a small initial capital and mostly depends on the ingenuity and talent of the entrepreneur. Original handmade clothing, bags, leather goods and jewellery can be offered to locals and tourists alike.

3. Online Sales

It is easy to open a Dutch website and turn it into a platform to facilitate online purchases or offer direct access to different providers of goods and services.

4. Mobile applications / IT business

Developers of mobile applications are discovering new useful and exciting solutions. The huge variety of apps covering areas from social productivity to finance attracts a broad range of customers. Read more on the high-tech industry of the Netherlands.

5. Childcare in the Netherlands

A lot of Dutch parents work full time and need babysitting services. Opening a centre for childcare is a good option for development of investors with previous experience (for example babysitters). This business requires special permits, mostly connected to the safety of children.

International entrepreneurs are treated in the same way as the locals and have the option to open any type of company. Regardless of the chosen field of operations, investors must complete the procedure for company registration and respect the national rules for taxation.

Some runner up ideas:

• Technical jobs such as plumbers, locksmiths, engineers, mechanics and much more are in high demand in The Netherlands. Due to a shortage of qualified personnel in these fields.

If you would like to receive more information on Dutch company registration, please, get in touch with our law firm.

Read here for more ideas on business opportunities in the Netherlands.

The Netherlands qualifies among the most progressive countries worldwide in regards to financial technology. The sector has a branch that uses blockchain wallets for buying and selling cryptocurrencies. Furthermore, the country has established WestHolland: a centre for development and research employing innovations to provide new technology for all areas of the economy. In the summer of 2017, the National Bank of the Netherlands officially announced the establishment of a new department for blockchain technology development.

If you are planning to open a business with cryptocurrency in the Netherlands our company incorporation agents can help you throughout the registration process.

The Netherlands as a top destination for cryptocurrency businesses

International investors, who consider opening a company that operates in the sector of finance, and particularly in the field of blockchain technologies can benefit from the fact that the country is among the few states worldwide that accept the usage of virtual currencies. Furthermore, the Dutch Central Bank has created a digital currency called DNBCoin. And the Dutch town Arnhem is famous as the ''Bitcoin City'' because all of its companies operating in the field of electronic commerce accept cryptocurrency payments.

The Dutch central authorities also recognize the potential contribution of cryptocurrency technologies to the future of the finance industry. Our consultants in company formation can provide you with detailed information on the procedure for starting a business with cryptocurrencies in the country.

Incorporation of a cryptocurrency company in the Netherlands

The opening of a cryptocurrency business in the country is not regulated by special requirements. Nevertheless, you need to register a company in the Commercial Registry in order to start operation. Our Dutch consultants in company incorporation can help you register your cryptocurrency business.

Investors planning to open Dutch companies involved with Financial Technologies with the aim of trading in virtual currencies need to be informed that the Netherlands has an established framework of such transactions.

If you need assistance in registering a virtual currency company in the Netherlands, please, do not hesitate to contact us.

Starting a crypto exchange in the Netherlands

The Netherlands has experienced a lot of Bitcoin and crypto initiatives in the early days of the new Digital currencies. The Netherlands is home to several Bitcoin and crypto vendors, who buy and sell cryptocurrency, as well as a Bitcoin exchange.

The platform has offered some insight into the regulatory framework of the Dutch Central Bank (The Financial Markets regulator).  The position of the Dutch Central Bank, according to the platform is that a crypto exchange does not need a license, as long as general KYC practices are met. Customers need to be adequately identified, and Anti Money Laundering policy and compliance need to be met, which is more or less comparable to the customer identification standards of Dutch law firms.

The lenient stance on cryptocurrency exchanges has not been noticed by the main crypto platforms to date. Not only the Dutch regulators are open to Crypto platforms, a variety of Dutch banks have- and are currently facilitating the Dutch Crypto vendors- and exchanges.

The Netherlands could be an easy access to the European market, with a warm stance on crypto companies and a stable investment climate and clear regulations.

Intercompany solutions can provide you with the practical know-how to start your Dutch Cryptocurrency business or exchange. Contact us for a free consultation on your case.

Crypto taxation related articles:

• Can Tax Authorities Identify Cryptocurrency Owners?
• How Developed Countries Collect Taxes on Bitcoin
• New Crypto exchange regulations (2019-2020)

The Netherlands is among the top business destinations for international investors because of its stable developed economy and open policies with respect to commerce and investments. Therefore it is a wise decision to open a Dutch NV company. Local businesses have the advantage of a flexible tax regime allowing corporate tax exemptions for income from capital gain and dividends.

NV is the abbreviation of Naamloze Venootshap, a type of company with limited liability. If you plan to incorporate an NV in the country, first you need to understand the general features of the entity. Most importantly, the minimum required share capital amounts to 45 000 EUR and no less than 20% of it has to be issued. NVs are most suitable for investors who plan to raise public capital.

The mandatory requirements for opening an NV include a minimum of one shareholder plus established boards of supervisors and managers. Also, the company must have a local registered address. A Dutch NV company has freely transferable bearer shares, registered shares or share certificates and can repurchase 10% of outstanding shares.

NV formation requires the services of a local lawyer and a Dutch notary with experience in preparing and executing incorporation deeds.

An important step in the formation of a Dutch NV company is its inclusion in the Dutch Commercial Register. The following documents are necessary for this registration procedure: a personal identity document, a statement from the bank, not more than thirty days old and a reference paper for a residential address or alternatively a copy of the contract for rent of the local property. These papers are needed to receive a registration number that is unique for the company.

Incorporators of a Dutch NV

The first stage in starting a Dutch NV is to establish the incorporators or founders of the company. These may be a single or multiple legal entities of any nationality, residing anywhere in the world. If for any reason the founders are unable to stay in the Netherlands during the process of incorporation, a Power of Attorney is sufficient for their representation.

Procedure for incorporation of a Dutch NV company

A Latin notary is able to execute the Incorporation Deed of the company containing the AoA.

If the newly opened NV owns registered shares, then it must also keep a register of shareholders. After the process of registration of the company is completed, the Latin notary shall prepare the register of shareholders to be maintained by the Managing Board in the official office of the company. Every shareholder is included with complete name, address, type and number of shares, currency and issue date, amount of paid-in capital per share, pledges, and other hindrances. Also, if the above details change the registration should be updated. This is a responsibility of the Managing Board and its representatives.

Procedure for Dutch NV registration

Within a period of 8 days after successful incorporation, some of the company’s details need to be included in the Registry at the Chamber of Commerce located in the same district as the NV’s registered office.

If you need more details on Dutch NV formation, please call our local incorporation agents. They will provide you with thorough information on the matter and will offer you personalized advice depending on your case and specific requirements. We also assist with the incorporation of private limited companies in the Netherlands. Read here on the difference between private and public liability company (BV vs. NV).