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The way we do business has changed significantly during the past few decades. Where there were once only physical stores, you can now shop for almost every imaginable trinket online. Artists have also started to offer their skills on the web, via websites, social media or international platforms like Etsy. One interesting development that clearly stands out, is that design is just as important as functionality nowadays.

One of the best examples to illustrate this is the smartphone we all use on a daily basis. Next to being chock-full of options that were once all separate devices (think in the likes of roadmaps, telephones, buzzers, the post office and gaming consoles), a modern day telephone also needs to be thin, sleek and slim. So it’s no wonder at all there are more and more companies that focus on both aspects.

The Netherlands is an excellent country for pioneering entrepreneurs

If you are active within one of these two areas, it might be extremely beneficial for you to open a branch office in the Netherlands or even move your company here: the Netherlands are at the forefront of innovation and design. The World Intellectual Property Organization awarded Holland with the 4th place worldwide in terms of innovative ideas and concepts, only preceded by Sweden, the US and Switzerland. You will have an ample amount of interesting sectors to choose from, highly accredited technical and art educational institutions like the TU Delft and the KABK and a vast array of pioneering freelancers to assist you with growing your business.

Design and services make up around 75% of the Dutch GDP

Designing services and technology both hold a strong position in relation to the Dutch GDP. Design can be subdivided in several different sectors like product development, strategic design, graphic design and comparable subjects. All of these together create a yearly turnover of around 200 million euro, whilst export products add up to 5 billion euro. Every year this sector grows a few %, also due to some interesting foreign startups and investments.

Opportunities in the Netherlands for your design or tech company

You will find a lot of tech opportunities in Holland, in the form of interesting international cooperations between professionals, freelancers and students. From universities like TU Delft and Universiteit Wageningen, both known for their innovative and excellent programs, concepts and graduates. You will find a lot of pilot projects aimed at the innovation of tech products, medical products and supplies but also experimental and completely new services and products.

The design sector is just as popular and flourishing. Especially cities like Amsterdam and Rotterdam offer you an excellent base of operations for your tech or design startup or company, with an amazing digital infrastructure, an open and artsy startup scene, lots of international talent and an ample amount of galleries and pop-up galleries to showcase your work. These two sectors work well together in social innovations like living labs and open work spaces, business models that include various different methods and partnerships that literally cross industries.

Intercompany Solutions can aid you in establishing your business in Holland

If you have an innovative idea and would like to take action, Holland is one of the best places to start. You will find that the Netherlands offer you huge benefits in terms of innovation, but also in more general and practical ways like low tax rates, an excellent bilingual workforce and a fantastic infrastructure with Rotterdam and Amsterdam never more than a moderate drive away. We can help you with registering a company in the Netherlands in just a few business days. We can also assist you with any questions you might have, just give us a call for more information.

If you are thinking about starting a freelance business, you might want to reconsider establishing a company in your own country. Especially if you already happen to reside here, for example when your spouse is an expat stationed in the Netherlands. More and more freelancers and entrepreneurs decide to found their businesses overseas. Why? Mostly due to the fact that multiple foreign countries offer substantial benefits for business owners, making it very profitable to start a foreign business.

The Netherlands is definitely one of those countries. With a very stable political climate, one of the lowest tax rates in Europe and many benefits that come with being a part of the European Union, you can very safely establish your business here for future success. Best of all: starting a company as a freelancer in the Netherlands is not difficult at all! There are some standard procedures you will have to follow of course. In this article you will find more information about the process.

Can anyone start a business in the Netherlands?

The answer to this question is yes. There are no limitations in terms of nationality. However, if you are residing in a country outside of the EU, the procedure will take a bit more effort and time, since you will need a certain permit in order to be able to stay in the Netherlands legally. This will either be a start-up permit, or a self-employed permit. You can find more info about the whole process of applying for the permits on this page about opening a Dutch company.

What do you need when you decide to register your freelance company?

There are several documents you will need to produce when you start the registration process. These contain necessary information regarding the identity of all people involved, as well as accompanying documents about the business itself, possibly an extensive business plan and also your preferred company name. It is advisable to hire a professional firm to guide you through the whole registration process, because it will substantially shorten the timeframe and probably also the total start-up costs.

You will need to think about the company form you will choose. In the Netherlands there is quite a large amount of legal entities to choose from, ranging from a sole trader business to a holding structure with multiple private limited companies. In general a private limited company is advisable, due to the many benefits and securities this legal entity offers. It is also the most chosen incorporated business form in the Netherlands, not just by Dutch entrepreneurs but also by almost all foreign investors.

Why choose the Netherlands to establish your freelance business?

The Netherlands is an extremely safe and stable country for entrepreneurs and foreign investors, with a very high success rate for most innovative businesses. Some of the benefits for your business you can expect here:

The Netherlands will offer you a safe and promising environment to establish and grow your business to success. If you want to know more or would like more information about the procedure of starting a business as a freelancer, you can contact https://intercompanysolutions.com and ask them all your questions. They can assist you every step of the way and offer many extra services.

The present article considers the steps leading to company mergers or acquisitions in Holland. One such step is an investigation called “due diligence” (or DD). It aims to elucidate the actual state of the respective company.  DD allows for the assessment of potential risks with the aim to inform the final decision about the transaction and also to adjust the purchase conditions.

Agreement of confidentiality / non-disclosure

During the negotiation phase of merger and acquisition the parties often sign an agreement of confidentiality (non-disclosure), so that any confidential information shared with respect to the tentative purchase remains secret. In this way, the vendor reduces the risk of public disclosure of the supplied information. To minimize the risk further, sometimes penalty clauses are included in the agreement.

Declaration of intent (DoI)

After the agreement of confidentiality has been signed, the (eventual) purchaser has completed due diligence and the initial negotiations have been closed, the parties prepare a declaration of intent (DoI) that provides the conditions for further negotiations regarding the company’s acquisition. The DoI generally contains the following (the list is not exhaustive):

Due diligence

During the second phase the purchaser performs an audit called due diligence examination (“DD”). This is an investigation intended to elucidate the state of the respective company and the possible risks, thus allowing the purchaser to make an informed decision on the potential transaction. The DD results are usually reflected in the conclusive purchase agreement terms and also in the statements and guarantees of the seller.

The following (non-comprehensive) list presents some common subjects to DD investigations:

These details are key to assessing the company and setting its purchase price. They can serve as a basis for indemnities and guarantees in the agreement for purchase. In addition to the legal DD investigation, it is important to perform financial and fiscal (tax) DD examinations.

Vendor DD

Every so often vendors also carry out their own DD investigations (or vendor DD) even before the start of the negotiations for takeover. Company problems can be fixed in time to prevent unpleasant surprises in the process of negotiation.

Agreement of purchase

After the DD examination is completed and the results are in, the parties start negotiating on the provisions of the purchase contract. This contract includes clauses on the risks related to uncertain events, financial and other, and their distribution among the parties. If, for instance, the DD examination has shown that claims are expected from pension funds or tax authorities, the purchaser can request specific guarantees or warranties from the seller (or a change in the price of purchase).

Agreement of share/asset purchase

Company acquisition usually involves a share transaction. The purchaser acquires the company shares held by the vendor by means of an agreement on share purchase. Sometimes it is necessary to conclude a different form of transaction, e.g. if the company to be acquired is a general partnership or a sole proprietor, rather than a legal person. In such cases the companies are subject to transfer of liabilities and assets by virtue of agreements of asset purchase.

Signing the agreement of share or asset purchase

After the parties agree on the transaction conditions (incl. the legal transfer date and the basis of the transaction), they sign an agreement of share or asset purchase (or another form of agreement, such as a merger contract). This phase is often referred to as “signing”. Usually the legal title transfer takes place weeks or even months later for a number of reasons, e.g. to give the purchaser enough time to fund the transaction. Agreements of share or asset purchase can also include resolutive or necessary conditions that must be met and can specify the period before title transfer.

Concluding the transaction

The transaction is concluded after all the necessary papers have been prepared and all requirements therein have been fulfilled or have expired. Then the documents related to the transfer are signed and, if a share purchase is taking place, the actual shares are transferred. Most commonly transfers take place against purchase price payment (or a part of it, if there is an earnout provision). In the Netherlands transfers of company shares are performed via transfer deeds prepared by Latin notaries.

If you are interested in buying or selling company shares for a company acquisition, find our articles below:

Holland has a well developed regulatory framework for private businesses, partnerships and corporations. The main elements of the framework consist of: clear rules on financial statements, auditing, and the publication of audits.

Because of the clarity and relative simplicity of the regulations, corporations are able to have a stable base of operations where they can plan for the long term. In this article, we lay out a summary of the requirements for accounting, auditing and publication in the Netherlands. If you would like to receive more detailed information, please contact us.

Mandatory preparation of financial statements

Practically all corporate entities registered in Holland are obliged to present financial statements. The requirement is statutory and often included in the entity’s Articles of Association (AoA).

Foreign companies are obliged to submit their yearly accounts in their home countries and provide a copy to the Dutch Commercial Chamber. Branches are an exception to this rule as they are not obliged to prepare separate financial statements.

Importance of the financial reports for Dutch businesses

Financial statements constitute the foundation of corporate governance and, as such, are a vital element of the legal system in Holland.

Their main purpose is to report to shareholders. Once the shareholders accept the statements, they discharge the directors’ board for its performance. Their equally important secondary purpose is to protect creditors. Practically all corporate entities are obliged to register at the Trade Registry of the Commercial Chamber and publish annually particular financial data. The Registry is publically accessible and represents an important information source with regard to the national market.

Financial statements also have to do with taxation. Even though the tax law provides independent rules for determining the tax basis, the first step of the process is to consider the statements.

Contents of Dutch financial statements

As a minimum, the statements contain a profit/loss account, balance sheet and notes on the accounts.

Generally Accepted Principles in Accounting (GAAP) in Holland

The Dutch rules for accounting are regulated. The accounting principles are primarily based on European directives.

The GAAP apply to private and public companies with limited liability and to other entities, e.g. some partnership forms. Companies listed on the stock market, insurance companies and financial institutions are subject to special rules.

The Dutch accounting principles differ from the international standards for financial reporting (IFRS) but they are continuously harmonized. As of 2005 all companies listed in the European Union are obliged to follow the IFRS. This rule also applies to the Dutch insurance companies and financial institutions. The question whether private limited liability companies (BVs), non-listed public limited liability companies (NVs) and other local business entities can follow the IFRS is still being discussed.

The Dutch accounting principles

According to the principles of accounting all financial information has to be understandable, reliable, relevant and comparable. All financial statements have to reflect realistically the position of the company in line with the principles.

The profit & loss account, balance sheet and notes must present truthfully and dependably the equity of the shareholders on the date of the balance sheet, the annual profit and, if at all possible, the liquidity and solvability of the company

Companies participating in international groups may choose to prepare their statements in compliance with accounting standards accepted in another member of the EU, if a reference to these standards is included in the attached notes.

The principles of accounting need to be presented in the statement. Once implemented, these principles can be changed only if the change is well justified. The reason for the change must be explained in the respective notes, together with its consequences with respect to the company’s financial position. The Dutch legislation lays out specific requirements for disclosure and valuation that must be respected.

The official reporting currency is the Euro, but depending on the specific company activities or its group structure, the report may involve another currency.

Consolidation, audit and publication requirements in Holland

The consolidation, audit and publication requirements depend on company size: large, medium, small or micro. The size is determined using the criteria below:

The following table summarizes the parameters used for classification. The asset values, staff and net turnover of group companies and subsidiaries qualifying for consolidation must also be included. Companies qualifying for the large or medium category must meet at least 2 of the 3 criteria in two consecutive years.

Criterion Large Medium Small Micro
Turnover > 20 M Euro 6 – 20 M Euro 350 K – 6 M Euro < 350 K Euro
Assets > 40 M Euro 12 – 40 M Euro 700 K – 12 M Euro < 700 K Euro
Employees > 250 50 - 250 10 – 50 < 10

Dutch requirements for consolidation

In principle, corporations must include the data of any subsidiaries and companies in their group in their financial statements in order to present a consolidated report.

According to the law in Holland controlled subsidiaries are legal entities in which companies can exercise indirectly or directly >50 percent of the rights to vote at the meeting of shareholders or are authorised to dismiss or appoint >50 percent of the supervisory and managing directors. Partnerships where companies are full partners also fall within the scope of the subsidiary definition. Group companies are legal entities or partnerships in the structure of company groups. The decisive consolidation factor is the control (managerial) over the subsidiaries, regardless of the percentage of held shares.

The financial information of subsidiaries or group companies does not need to be presented in the financial statements (consolidated) if:

1. It is insignificant compared to the whole group:

2. Consolidation can be excluded if the group company or subsidiary:

3. Consolidation can also be excluded under the following circumstances:

Requirements for audit in Holland

The law in Holland requires that large and medium companies have their yearly reports audited by qualified, registered and independent local auditors. Auditors are appointed by shareholders, members of the general meeting, or, alternatively by the managing or supervisory board. In principle, audit reports should include points clarifying whether:

The appointed auditor reports to the supervisory and managing boards. The competent institution should first consider the audit report and then approve or determine the financial statements.

If it is not mandatory to carry out an audit, the parties may do so voluntarily.

The Dutch publication requirements

All financial statements should be finalized and accepted by the members of the managing board within 5 months following the financial year’s end. After that the shareholders have two months to adopt the statements after their approval by the management directors. Also, the company has to publish its yearly report within 8 days of the shareholders’ approval or determination of the statements.  Publication means submission of a copy at the Trade Registry, Commercial Chamber.

The period for preparation of the statements can be extended by up to five months by the shareholders. Therefore the publication deadline is 12 month following the financial year’s end.

If the entity’s shareholders also act in the capacity of managing directors, then the date of approval of the documents by the Management Board would also be the date of adoption by the meeting of shareholders. Under such circumstances, the publication deadline is five months (or ten months, if an extension of five months has been given) following the financial year’s end.

The requirements for publication depend on the company size. They are summarized in the table below.

Document Large Medium Small Micro
Balance sheet, notes Fully disclosed Condensed Condensed Limited
Profit & loss accounts, notes Fully disclosed Condensed Not necessary Not necessary
Valuation principles, notes Fully disclosed Fully disclosed Fully disclosed Not necessary
Management report Fully disclosed Fully disclosed Not necessary Not necessary
Statements on cash flow Fully disclosed Fully disclosed Not necessary Not necessary

Can we help you?

We can offer you a full list of services for accounting, including the preparation of financial statements/yearly reports, administration, tax compliance and payroll services.

Please, contact us with any questions related to this article or in case you want us to send you a specific proposal for engagement.

The present article describes the legal and tax aspects and some practical matters concerning office establishment in Holland. It summarizes information about the Dutch legal and tax system relevant to the required procedures. The article also presents Holland as an international centre of commerce and highlights the location advantages gained by opening a Dutch office. Finally, it discusses other matters of practical importance such as living and labour costs.

Please, do not hesitate to call our tax and incorporation agents if you have legal or tax issues or in case you need any additional information.

Tax aspects of establishing a Dutch office

Company establishment in Holland has numerous tax advantages. Many entrepreneurs choose to incorporate an international structure under an efficient tax regime such as the one in Holland. Dutch legal entities within company structures bring many tax benefits. The main advantages can be summarized as follows:

1) The benefit of double tax avoidance thanks to agreements concluded by Holland and to the EU directives on direct tax;

2) The participation exemption;

3) The option to negotiate agreements with the national tax authorities regarding advance pricing (APAs) and tax ruling (ATRs). Such agreements provide certainty about future tax payments;

4) Holland’s bilateral treaties on investments (BITs)

5) Dutch tax credits for income from foreign sources;

6) The Innovation Box (IB) regime for R&D activities;

7) No withholding tax levied on outbound royalty and interest payments; and

8) The scheme for highly qualified migrants (30 percent ruling).

These tax benefits will be explained in detail below.

Benefits of Dutch holdings

A Dutch holding can serve as an investment centre for companies established in various countries worldwide. Holland is recognized for its favourable regime with respect to holdings, particularly thanks to the participation exemption, coupled with an extensive network of tax treaties and bilateral agreements on investments. The main benefits prompting international businesses to use Dutch holdings as intermediaries are the lower withholding tax in the country where profit is generated, the untaxed receipt of funds accumulated by foreign subsidiaries and the protected status of these subsidiaries. These advantages will be clarified below.

The Government of the Netherlands has declared its general intention to keep and preserve these benefits, considered figuratively as jewels in the crown of the national tax system, regardless of the attempts of the Organisation for Economic Co-operation and Development and the European Union to combat tax avoidance strategies aimed at shifting profits from higher- to lower-tax jurisdictions.

The participation exemption in the Netherlands

As already mentioned, Holland is popular with the so-called participation exemption. If particular conditions are fulfilled, capital gains and dividends obtained from qualifying subsidiaries are not subject to Dutch corporate tax.

This exemption applies if an eligible subsidiary holds no less than 5 percent of the company’s shares. One eligibility criterion is that subsidiaries must not hold the shares with the sole purpose of passive investment in a portfolio. However, even in cases where this purpose is predominant, the exemption still applies if the subsidiaries are paying profit tax of no less than 10 percent (under the rules of tax accounting in the Netherlands) or if less than half of their assets are allocated to passive investments. When the exemption cannot be applied, companies usually have the option for tax credit.

The system for tax ruling in the Netherlands (Advance Pricing Agreements, APAs and Advance Tax Rulings, ATRs)

The Dutch system for advance tax ruling provides clearance in advance by concluding APAs and ATRs with Dutch companies with respect to their tax position. The conclusion of such agreements is voluntary. In general, companies use the system for tax ruling to become aware in advance about the tax liabilities relating to planned intercompany transactions. ATRs provide advance certainty with respect to the tax repercussions of envisaged transactions by clarifying, for example, if they will be eligible for participation exemption. APAs, on the other hand, define when the arm’s length principle can be applied to international transactions between associated companies or different parts of the same company.

Bilateral treaties on investments (BITs)

When investing in a foreign country, one should consider both the respective taxes and the protection of the so-called bilateral treaties on investments, especially if the investments are made in a country with a serious risk profile.

BITs are concluded between two countries to establish the terms for protection of entities from one country investing in the other country. These treaties ensure reciprocal protection and promotion of investments. They secure and protect the investments of entities residing in one of the contracting parties on the other party’s territory. Therefore BITs represent institutional safeguards with respect to foreign investments. Also many BITs provide for alternative mechanisms for dispute resolution where investors whose rights have been infringed upon can opt for international arbitration rather than sue the defaulting country in its courts.

Holland has developed a large network of such bilateral treaties offering investors the best possible security and protection in foreign contracting countries. It is worth to mention that Holland has entered into BITs with approximately 100 states.

Investors who reside in a country signatory can benefit from the protection of its BITs. Therefore Holland is an attractive jurisdiction for setting up holding companies not only due to its favourable tax regime, but also thanks to the numerous BITs it has concluded.

The double tax avoidance decree

In order to encourage Dutch investments into other, especially developing, countries, the Government has introduced a regulation providing a mechanism to lower Dutch corporate tax on profits obtained from investments in countries that have not concluded tax treaties with Holland. This piece of legislation is the Unilateral Double Tax Avoidance Decree (hereinafter referred to as DTAD). As a result of the DTAD the Dutch taxes levied on investments in countries that have not concluded tax treaties with the Netherlands are usually the same as the taxes levied on investments in tax treaty states.

The Innovation Box (IB) regime

Holland boasts a favourable tax climate under the innovation box regime, with regards to companies working in the field of research & development (R&D). Any company generating income from its own developed and patented intangible fixed assets (excluding trademarks and logos) or from assets derived from R&D activities (verified by an official statement) has the option to report the income using the IB regime. Then its eligible income exceeding the costs for the development of the intangible fixed assets will be subject to only 5 percent tax. Any losses associated with the eligible assets can be deducted against the usual corporate tax rate, i.e. 25 percent. If losses are included in the tax return, then they need to be recaptured using the normal rate. Only then the reduced 5 percent rate will become available again.

No withholding tax with respect to royalty and interest payments

Holland is an attractive jurisdiction for setting up (group) license and finance companies. The greatest advantage of establishing a Dutch license or finance company lies in the tax-effective setup of these entities. In broad terms this efficiency stems from the convenient tax treaties that Holland has concluded, coupled with the lack of withholding tax with respect to outbound royalty and interest payments. If certain requirements are fulfilled, these prerequisites allow for an extremely tax-efficient “flow” of license income and finances through the entity in the Netherlands to the eventual recipient.

The scheme for highly skilled migrants

Foreign employees living and working in Holland can benefit from a concession if they meet particular requirements. This concession is called the 30% ruling. According to it, 30 percent of the wages of the international employee remain untaxed. As a result the overall tax rate on personal income revolves around 36 percent instead of the usual 52 percent.

Legal aspects of establishing a Dutch office

Having a Dutch company in the framework of an international corporation provides both tax and legal benefits. Some important legal benefits are:

1) The legal system in the Netherlands has provisions for various entities to match the characteristics and needs of the planned business operations;

2) The Dutch Commercial Chamber (KvK) is very efficient and cooperative;

3) It only takes a day or two to obtain legalization from a Dutch Latin notary and a court-issued apostille;

4) It is easy to arrange the appointment of a local managing director, for example, to meet the subsistence requirements; and

5) In 2012 the laws on private limited companies (BVs) were thoroughly amended and currently they are a lot more flexible.

The corporate law in the Netherlands has provisions for entities both with and without a legal personality (i.e. both incorporated entities and partnerships/contractual entities).

Types of companies in the NL

The more commonly used entities without a legal personality include:

1) sole trader/sole proprietor/a one-man business (Eenmanszaak); (technically, sole proprietorships are not legal entities);

2) general partnership (Vennootschap onder firma or VOF);

3) professional/commercial partnership (Maatschap); and

4) limited partnership (Commanditaire vennootschap or CV.

The more commonly used entities with a legal personality include:

1) private company with limited liability (Besloten vennootschap or BV)

2) public company with limited liability (Naamloze vennootschap or NV)

3) cooperative association (Coöperatie or COOP); and

4) foundation (Stichting).

The choice of a legal entity depends on the type of business to be conducted. Owners of small businesses and freelancers usually establish sole proprietorships, while larger enterprises are incorporated as private companies with limited liability (BVs), public companies with limited liability (NVs) and limited partnerships (CVs).

After you decide to start a business, the first step is to register it at the Commercial Chamber which will include it in the Trade Registry. This procedure must take place during the period starting a week before your business becomes operational to a week after that.

Further details about the private company with limited liability (BV)

The private company with limited liability (Besloten Vennootschap or BV) with nominal capital split into shares is the most commonly used entity for business operations in the Netherlands. A BV has one or multiple shareholders and issues only registered shares. It can have one or several “incorporators” or subscribers who can be legal entities and/or natural persons. An entity or an individual, be it resident or foreign, can simultaneously be the sole incorporator and director representing the board of management.

Geographical features: Holland as an international commercial centre

Holland is an ideal strategic destination for businesses thanks to its connectivity. Companies established in the country can easily place their products and services on markets in the EU, Eastern and Central Europe, Africa and the Middle East. Holland is located in the western part of Europe and has common borders with Belgium (south) and Germany (east). To the west and to the north it borders the North Sea and its coastline is 451 km long. Holland is a small country with a territory of 41 526 square kilometres. Its economy is strongly dependent on international trade (more than 50% of the Gross Domestic Product is derived from foreign trade). The country is among the world’s top 10 exporting nations, which is quite an achievement for its size. Approximately 65 percent of all Dutch exports are destined for five countries: USA, the United Kingdom, Belgium, Germany and France.

More than 50% of all export and import in Holland consist of foods, machinery (mainly computers and parts) and chemical products. Many import goods (computers included) are actually destined for other countries and are re-exported largely unprocessed soon after their arrival in Holland. This situation is typical for big transportation and distribution hubs. As a matter of fact many millions of tonnes of North American and Asian goods arrive at Amsterdam or Rotterdam for distribution all over Europe. The role of Holland as an European gateway is also sustained by Schiphol Airport in Amsterdam – the fourth busiest and biggest airport on the continent servicing traffic of both goods and passengers. Most Dutch transportation companies have their bases of operation either in Rotterdam (with Rotterdam The Hague Airport) or close to Schiphol. Other major European airports, namely Düsseldorf and Frankfurt in Germany, Roissy in France and Brussels and Zaventem in Belgium are only several hours away. Furthermore Holland has an exceptional railroad network connecting important European capital cities, including London. The EU capital of Brussels is only a short ride away. Also, Rotterdam’s port is the biggest on the European continent. Until 12 years ago it was also the busiest port in the world, but was overtaken by Shanghai and Singapore. In 2012 it was the sixth busiest port in the world as regards tonnage of cargo per year.

Cost of labour

The living standards in Holland are relatively high and this is reflected by the average salary. In 2015 employers paid 2500 Euro/month to their employees and therefore the average cost of labour was 34.10 Euro/hour. All due taxes are levied at the source of income. The average work week is about 40 h.

The costs of labour in the different members of the EU vary widely. In 2015 the average pay per hour for the whole European Union was 25 Euro, and for the Eurozone the rate was 29.50 Euro. Therefore the costs of labour in the Netherlands are 16 percent higher compared to the average Eurozone value. Still, in 2015, five EU countries had higher labour costs than Holland. The average pay per hour in Denmark (41.30 Euro) and Belgium (39.10 Euro) is approximately 10 times higher compared to the value for Bulgaria (4.10 Euro). The labour in Belgium is more costly than in Luxembourg, the Netherlands, Sweden and France. Yet, the costs of labour in Lithuania and Romania are not much different than the cost in Bulgaria, even though the salaries in these 3 countries are on the rise.

As of 07/2015, the national minimum gross salary in Holland for employees aged 23 and older is 1507.80 Euro/month, i.e. 69.59 Euro/day. Based on 40 working hours per week, this equals 8.70 Euro/hour.

Amsterdam: The new European capital of finance

According to the writer James Stewart, a business columnist working at the NY Times, after Brexit Amsterdam is bound to become the new London thanks to its impressive architecture, top rated schools and exciting night life. Holland has been a global centre of commerce for centuries and so the country is traditionally tolerant to foreigners. Furthermore almost all Dutch residents speak English. The schools in Holland are considered the best on the European continent, with many opportunities for education in English. Amsterdam captivates with its architecture and offers attractive housing options, outstanding restaurants, picturesque views, theatrical and musical performances and an exciting night life. Its citizens have a tolerant, cosmopolitan attitude cultivated for centuries, ever since its emergence as a centre of global trade.

Thanks to the continuous efforts of the nation Holland is currently among the wealthiest states worldwide. The country’s strategic location on the North Sea coast and its rivers, bringing industrial and agricultural benefits have undoubtedly contributed to this success. Thanks to these geographical characteristics and the inherent work enthusiasm of its people, the Netherlands is now a great centre of commerce.

In addition, Holland has a well developed welfare state system ensuring that all the citizens share the prosperity of their homeland. The Dutch take great pride in their high living standards. The expenses associated with living, education, housing and culture are lower compared to most countries in Western Europe. The United Nations Sustainable Development Solutions Network surveys many people residing in various countries worldwide to prepare its annual World Happiness Report. As evident by its name, the report states which countries have the happiest populations. In 2018 Holland took the 6th place.

Cost of living

Similarly to many other countries in Europe, the living cost in Holland has increased with the adoption of the common currency, the Euro. A standard room costs 300 – 600 Euros/month, so it is a lot cheaper to settle in a non-urban area, than to live in a city like Amsterdam or The Hague.

The public transportation is comparatively cheap by EU standards. Most areas work with chip cards (“ov-chipkaart””) that can be used on trams, buses, metros and trains. In the city a single bus ticket costs approximately 2 Euro. A ticket for the train from Schiphol to the Central Station in Amsterdam costs about 4 Euro. A ticket Amsterdam – Utrecht is around 7.50 Euro. In contrast, taxi services are quite expensive. The usual starting cost is 7.50 Euro and the rates reach 2.20 Euro/km.

Please, do not hesitate to call our experts in taxation and incorporation. They will happily assist you with the procedures for starting your own business in Holland.

If you intend to start a business on the European continent, you have to choose a suitable country to begin with.  Europe includes 44 countries (28 members of the EU) of various sizes, languages and levels of economic development. You might consider the Netherlands as a good place to establish your European business. The five main reasons why you should are listed below.

  1. English will do everywhere

Regardless of the part of Holland you are in, the locals will speak basic English as a minimum. Your beginner’s attempts to speak Dutch will most likely result in replies in English. The widespread knowledge of the English language has multiple advantages, among which:

The big cities like the capital of Amsterdam, Utrecht, Den Hague and Rotterdam are an hour away from one another by car, at the most. The Randstad megalopolis hosts seven of the fifteen million people living in the country. Even the far-off regions or towns are no more than 3 hours away by car. Therefore you will be able to operate on the whole territory of the country from a single location.

  1. Considerable spending power

Statistics show that in Holland the gross domestic product per capita rates among the highest worldwide. And, unlike in other top scoring countries, the distribution of income is relatively even. Therefore most Dutch residents have quite a bit of spending money.

  1. Good opportunities online

The broadband penetration in the Netherlands rates among the highest worldwide due to the coaxial and phone networks covering the entire country. Dutch people shop readily online, while it is cheap and easy to arrange payments for the services and goods you offer. Consumers are not biased and more inclined to buy Dutch products: good deals always attract customers.

  1. Setting up a company is easy

The last competitiveness ranking prepared by the International Institute for Management and Development rates the Netherlands 1st on the European continent and 4th in the world with respect to competitiveness. With the help of Intercompany Solutions, you can register your company within a few days. Small businesses need to meet few requirements and it is not obligatory to appoint an accountant or a local director. The rate of corporate income tax is twenty percent. You will also need to pay a fifteen percent withholding tax, but this could be settled with taxes on dividends covered by you elsewhere.

If you need further information on company establishment in Holland, please, get in touch with our qualified agents. If you are interested in starting a business in the Netherlands, you might also like our article with 5 ideas for opening a small Dutch business.

A Netherlands-based company may decide to sell shares due to the expansion of the business or as a plan to accumulate larger income. The acquired capital may be directed towards debt repayment or reinvestment in the business.

A Dutch company can sell or transfer shares only in accordance with the provisions of the Association Articles. Share transfers also require the preparation of notarial deeds. Companies can become public by entering the stock market and offering shares publicly. Only certain company types can use this option. Our Dutch experts in company formation can provide you with detailed information on the features of different commercial entities in the Netherlands.

Are you interested in buying Dutch company shares? Read here

Selling company shares in Holland

Only some types of Dutch companies are able to sell shares publicly. NVs (public limited companies) can list their shares in the Stock Exchange. BVs (private companies with limited liability) do not have this option, as their shares are registered privately and cannot be transferred freely.

The best way to sell stocks for most Dutch public companies with limited liability is to go on the exchange market. In Holland company owners go public using Euronext.

Transfer of shares in Holland

In the Netherlands, registered shares are transferable through notarial deeds. The process must take place in the presence of a Latin notary. Any developments or limitations regarding the share transfer are noted in the association articles of the private or public Dutch company with limited liability.

Dutch companies can be acquired through purchases of shares or assets. The two mechanisms are different with respect to the transfer of liabilities. In share purchases, the buyers also acquire the obligations and responsibilities of the respective companies.

Our Dutch agents specializing in company formation will be happy to provide you with further information on buying and selling company shares, and on the possibilities open to investors.

Investors who have decided to buy shares of Dutch companies are able to purchase them either directly or via a plan for dividend reinvestment. They can acquire the ownership shares of a particular company or implement a larger plan for stock investment in multiple companies.

Holland welcomes international investments and foreign companies are free to open headquarters in the country. The business climate is equally appropriate for making large investments and opening Dutch companies with the perspective to sell shares to investors from outside.

Are you interested in selling Dutch company shares? Read here

Direct purchases of stocks in the Netherlands

A widely used method to purchase shares in Dutch companies is to deal directly with the entities issuing them. Big international corporations are among the most attractive businesses and most of them provide plans for direct purchase of stocks. One of the advantages of this mechanism is that commissions are avoided, even though a minimal deposit is usually required.

Stock purchase is beneficial for both the buyer and the issuing company. This is a way for investors to maximize their earning, while companies raise additional budget at reduced costs. Companies allowing direct purchase of shares publicize this information. Our Dutch agents specializing in company formation can assist you with details about local companies offering shares publicly and on the Euronext listings.

Purchasing shares in the Netherlands

There are two other options open for investors: to purchase stocks through a plan for dividend reinvestment or brokerage.

Some companies offer plans for reinvestment of dividends, allowing investors to reinvest the amounts accumulated in dividends by buying additional shares.

Brokerage is the other method to purchase Dutch company shares. This is a preferable option for entities that want their investments in Holland to be managed by experts. The extra management of accounts is more costly compared to other options.

Would you like to learn more about establishing a business or investing in Holland? Please contact our Dutch agents specializing in company formation.

The labour force in Holland is an essential factor for the country’s progress. The strong Dutch economy is growing rapidly, relying on well-developed infrastructure and skilled, productive employees. Undoubtedly the superior training and adaptability of the Dutch employees contribute significantly to the welfare of the Netherlands in the long run.

Our local consultants in company registration can give you details on the legal procedures for hiring employees in the Netherlands.

Highly qualified professionals

Dutch employees are ready to embrace changes and to acquire new skills and competencies. The national labour force is among the most flexible worldwide. The same applies to the local employers who readily make investments in their staff and motivate them to take up new challenges.

The Dutch labour force has one undeniable advantage: most people speak two or three languages. This is important for the role of the Netherlands on the European economic scene. Dutch employees are constructive, skilled and productive. They are well educated and open for cooperation. As regards the level of qualification, Holland is third in the global top for higher education.

The labour market in Holland

Foreigners who have moved to Holland only a few years ago with the aim to work for local companies now possess the skills to establish their own businesses. Regions such as West Holland offer great opportunities to entrepreneurs intending to create start-ups.

The labour market in Holland has evolved accordingly and the current demands are mainly focused on engineers and technicians. West Holland contributes significantly to the workforce qualifications because many of its universities cooperate with local companies to educate prospective employees.

Our agents in company formation in the Netherlands can help international investors planning to start Dutch businesses.

The law on employment in Holland

The Dutch law on Labour and Employment is quite complex. A contract for employment in the Netherlands may be concluded in oral or written form. In any case, the employer has to clarify certain aspects to the employee. Some of the key aspects are:

  1. job description and position;
  2. hiring date;
  3. place of work;
  4. temporary or permanent employment;
  5. salary;
  6. working hours;
  7. rights to pension (if relevant).

Employment contracts can be concluded for a particular or indefinite time period. Employment agreements often include restrictive clauses related to confidentiality and non-competition. Read here on appointment and dismissal of staff in the Netherlands. 

International employees in Holland

The Netherlands has its own skilled labour force, but also attracts international talent. Foreign employees need residence permits to work in Holland. Highly qualified individuals can take advantage of the visa program for skilled migrants facilitating the procedure of hiring foreign staff in the Netherlands. The employer also needs to obtain a special employment permit. Swiss and EEA nationals are excluded from the rule.

Would you like to receive more information on the employment legislation in Holland? Contact our experts.

Thanks to its history of innovations and exceptional digital infrastructure Holland hosts the largest ecosystem for start-ups in Europe. In fact, as reported in the 2016 Start-up Scoreboard of the EDF, the country has the most beneficial business climate for start-ups in the European Union. With 10+ start-up and technology centres in a ninety-minute radius, the Netherlands provides many options for the establishment of innovative companies operating in any sector. The Netherlands is also referred to as ''The European Silicon Valley''. The Dutch cities offering the best conditions for start-ups are listed below.

The Hague

The international centre of justice and peace is currently the largest security and safety cluster on the European continent due to its many embassies and international organizations alongside some four hundred security companies. The Security Delta Campus in The Hague supports specifically start-ups in the field of cybersecurity by providing living laboratories, office spaces and training facilities.

HackerOne is among the most interesting start-ups in Den Haag’s security cluster. The company is an American-Dutch venture conceived by security leaders working for Microsoft, Google and Facebook. In 2015 this resourceful start-up established a centre of operations in Den Haag, after raising USD 25 million Series B funding. Until now it has provided services to fifty companies, including Twitter, Uber, Slack and the US Defence Department, finding more than 21 000 bugs.

Read more on the city of The Hague

Rotterdam

Rotterdam is the largest city in Holland, after Amsterdam. It boasts the biggest and most active shipping port in Europe. In recent years Rotterdam has been acknowledged as an excellent location for start-ups. Last year it was featured in Financial Times as a suitable location for launching new ventures. As a shipping centre, Rotterdam has encouraged the development of start-ups specializing in port-related technologies. They are aided by a dedicated Innovation Lab, established jointly by the YES!Delft incubator and Rotterdam’s Port.

Last year the Cambridge Innovation Centre (CIC) based in the USA opened its first international hub in Rotterdam. The city is located close to numerous renowned universities and the CEO of CIC, Tim Rowe, compared it to Boston, USA.

Read more on the city of Rotterdam

Utrecht

Utrecht is located at the heart of Holland and strives for healthy people, minds and environment. It is maintaining one of the most sustainable and healthiest living environments in the world and provides exceptional quality for business and life. The EC has recognized it twice as a leader among the competitive regions in Europe.

Utrecht hosts approximately 400 start-ups that benefit from the local institutions and resources. It is the home of UtrechtInc, rated in the top 10 for European incubators, and a Science Park fostering innovation in cancer research, stem cells, sustainable urban planning and bioprinting.

Read more on the city of Utrecht

Amsterdam

Holland’s capital is a global destination for businesses, famous among visitors with its scenic canals. Dubbed the capital of start-ups in mainland Europe, it offers all the necessary ingredients to transform an idea for a start-up into a business generating billions. Amsterdam hosts top European accelerators, such as Startupbootcamp and Rockstart, and establishments of giants like Salesforce, Uber and Google.

The unicorn company Adyen operating in the field of financial technology was started in Amsterdam. It was established in 2006 and is currently valued at USD 2.3B. According to Fortune, it is certainly a unicorn that you can bet your money on.

Read more on the city of Amsterdam

Eindhoven

Utrecht is the heart of the Netherlands, while Eindhoven with its region of Brainport is undoubtedly the country’s brain. In 2011 the Intelligent Community Forum rated it as the smartest region in the world. Eindhoven, a centre for high technology development and design, boasts a huge network of R&D and academic facilities, e.g. the High Technology Campus and its Holst Center dubbed Europe’s smartest square kilometre, as well as Eindhoven Technology University. The active collaboration within this network has enabled Brainport to generate USD 2.8B in innovation spending by private organizations.

The lucrative technology environment in Eindhoven attracted the interest of the Singularity University based in the Silicon Valley. As a consequence SU opened its first international department there: an innovation centre bringing together representatives of leading research institutions, start-ups, businesses and the government to work on new revolutionary technologies, such as food scanners, DIY drones and self-driving automobiles.

Read more on the city of Eindhoven

Are you intending to establish a start-up in Holland? It is easy to do so with the special Start-up Visa for international entrepreneurs. Get in touch with our team to receive further information and consultancy on start-up establishment in Holland.

When asked to name a Dutch city, people tend to come up with Amsterdam, the capital of the Netherlands, famous for its historic landmarks and open-minded citizens. They also think of Rotterdam – proud with the smartest port in the world, or the inventive city of Eindhoven situated in the Brainport region of Europe. But how about Den Haag?

The Hague is home to the Dutch government and has close to 500 000 residents. It is full of legislators, diplomats and leaders on the global business scene. No wonder that it is the birthplace of many international innovations, laws and ideas. Read this article to learn about this important Dutch city and contact us if you would like to receive more information on doing business in Den Haag.

The city of The Hague

The Hague, home to the classic paintings of Vermeer and the royal family, has an important place in the history of the Netherlands. It was established in 1230, originally as hunting grounds of the Counts of Holland. Its name originates from “s-Gravenhage”, meaning “The Hedge of the Count”. The city became the official seat of the Dutch government in 1588.

The Hague continues to host the Dutch cabinet, Supreme Court, State Council and States General. The Gothic Binnenhof complex, a castle serving as government seat, is the oldest functioning parliament house in the world.

The Hague: An international centre of justice and peace

The impressive historical legacy of The Hague in terms of government has earned its recognition as an international centre of justice. The Hague International Peace Conference of 1899 was the first of its kind in the world. Less than half a century later the UN selected the city as its international law centre. Today The Hague also accommodates the international justice and criminal courts where global disputes are often resolved.

Dedicated to security and peace, the city puts a lot of effort in supporting Holland on its way to becoming a secure gateway to the European continent. It encouraged the development of the world’s top cluster in the field of security: the Security Delta (HSD). It fosters cooperation between knowledge institutions, businesses and governments with the aim to achieve superior cybersecurity and build critical infrastructure.

The Hague is home to 400+ companies operating in the field of security. American data and technology companies like Dtex Systems and LeoStat have also recently established registered offices in the city.

The Hague: An attractive business hotspot

Thanks to its strong foundations, Den Haag is a very attractive destination for businesses. Various companies like Siemens, APM Terminals, AT&T, Shell and Samasource have established their European headquarters in the city. As a matter of fact, as many as 49 international companies made investments in the city in 2016.

In addition to private companies, Den Haag also hosts 240 foreign organizations, NGOs and tribunals, e.g. NATO’s Agency of Information and Communication, Europol and the European Patent Office.

The Hague: An experimental ground for innovations

NGOs, private companies and the government work together on this ideal ground for testing new ideas.

Some of the most recent innovative fields of work include the use of drones in emergencies, green energy alternatives and simplification of complex data communication. The first centre for Robotics and Artificial Intelligence of the UN was also established in The Hague.

The city boasts 20+ international higher education institutions and schools that support new ventures. Leiden University is the oldest in Holland and its Innovation Centre is located in the city of The Hague. The Hague also has an official centre for entrepreneurs called Impact City. It hosts programmes like the Innovators Challenge and Startup in Residence.

In case you are interested in starting a business in Den Hague, contact our specialists in company formation. They will gladly provide you with more information on company establishment and investment opportunities in the country.

The life expectancy in the Netherlands is approximately 81 years. Studies also show that the country has the happiest children and the tallest population worldwide. The national healthcare system established 150 years ago is easily accessible and recognized all over the world. With good collaboration between the industries and scientific institutions, dedicated clusters and robust links between research, business creation and production, the national sector of Health and Life Sciences maintains its competitiveness in the world industry.

If you would like to establish a company in the Life Sciences and Health sector, please do not hesitate to contact our incorporation agents. They will be happy to give you more information and legal consultancy.

Combined solutions from scientific research to patients

The characteristic Dutch approach to creativity and collaboration and the readiness for cooperation in the name of greater goals has led the Netherlands to its top ranking in open innovation and private-public research. The success of the sector of Life Sciences and Health stems from the close collaboration and sharing of knowledge between research institutions and companies with full governmental support. This model linking research, innovation, knowledge and production generates affordable, sustainable and robust solutions to set global standards. The Dutch multidisciplinary approach yields superior expertise and knowledge in the area of healthcare, linking science to patients, and frequently leads to the adoption of comprehensive, combined solutions. The innovative services and products in fields like medical equipment and remote care, and the collaboration of Medtech and Pharma in the area of diagnostics provide solutions for many contemporary health care challenges faced worldwide.

Five advantages of the sector of Health and Life Sciences in the Netherlands

Impressive historical contributions

Holland has made remarkable contributions to medical science:

Cooperation, collaboration and building of coalitions

Holland maintains its position as a key global player in Health and Life Sciences with significant technological achievements in the fields of health infrastructure and medical technology, biomaterials (coatings for medical equipment), regenerative medicine, veterinary and human vaccines, biopharmaceuticals, medical informatics and molecular imaging. The success of the sector lays in the cooperation, collaboration and building of coalitions between research institutions, universities, businesses and the government that link research to business creation and production.

Turnkey projects

The Dutch expertise in the infrastructure of healthcare is represented by turnkey projects: local companies have the ability to simultaneously cover the aspects of medical equipment, waste management, design, engineering, financing, etc., with special attention to “healing environments” and energy efficiency.

Health and Life Sciences is among the leading industries in the national economy and is given first priority by the Ministry of Economy. The sector achieves its success by uniting partners and joining forces along the (value) chain of prevention, cure and care.

The Dutch programme in the field of genomics

The Netherlands has a national programme for genomics and three substantial private-public programmes connected to Regenerative Medicine, Pharmacotherapy and Translational and Molecular Medicine worth over a billion Euros. Within the framework of these programmes large industrial partners and small/medium enterprises cooperate with the 8 medical faculties (the faculties of medical technology of the 3 Technical Universities and the university hospitals) on projects for research and development with direct contributions to clinical practice. The programmes finished in 2012/2013, but their initiatives are still progressing.

Quality, accessibility and affordability of healthcare

The national health care services offer quality, accessibility and affordability for all. Many countries use Holland to illustrate how health care quality can be provided with the maintenance of a reasonable cost level. As regards future perspectives, Holland is directing its efforts towards eHealth (online prevention and therapy, telemedicine).

Dedicated to support entrepreneurs with starting and growing business in the Netherlands.

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