Forming a company in the Netherlands may seem like a daunting task but is surprisingly easy once you have the correct information. You can usually register a company in Holland within 24 hours for a nominal fee. Once you are set up you will have very little bureaucracy to worry about and can take advantage of Holland’s uniquely open attitude towards local and international entrepreneurs and businesses of every size. Welcome to the Netherlands!
After forming a company in the Netherlands you will have access to a flourishing local and European market of over 150 milli consumers within a 24 hour reach. Holland’s cutting edge transport and communications infrastructure coupled with a highly-educated, multilingual workforce and competitive corporate tax laws are the reason global companies like Coca-Cola, Nike, Adidas, IBM, Huawei and Google choose the Netherlands. You will be keeping privileged company while paying some of the lowest taxes on the continent!
The first and foremost question with regards to forming a company in the Netherlands is understanding the different types of company structures and which one is best for you. Some of the main factors in deciding what type of company to register in Holland are the type of business you are in, amount of share capital, number of partners involved, independence and tax considerations. Don’t worry, you should quickly be able to figure out which type of company structure in the Netherlands best suits your business!
The following information will guide you on each type of company you can form in the Netherlands. There are common corporate structures for most industries and business types but this does not mean that you have to register a company exactly the same as similar businesses to yours. As well, you can form a company without any corporate or legal personality. Regardless of the size and type of business you are engaged in you will be able to find a suitable company structure for you to incorporate here in the Netherlands.
If you are a solo entrepreneur, freelancer or startup then you may consider registering your business as a Sole Proprietorship or Sole Trader. This is a popular form of company if you do not expect significant profits or liabilities and do not have any shareholders or investors. You will be registered as a “self employed professional” or a “freelancer” but you will not be considered a corporation or legal entity. If you are a single entity and do want to incorporate your business in the Netherlands then the best option is usually to form a Private Limited Company.
Private Limited Company (BV)
Most foreign businesses registering a company in Holland choose this form of company structure. The primary requirement for forming this kind of company is a minimum share capital of 0.01 EUR. There are also ‘substance’ requirements relating to the Board of Directors and local company headquarters. A Dutch BV may be fully-owned by non-residents and there are no requirements for a local Director or shareholder. There are also no restrictions on capital or transactions. The BV is similar to the German GMBH, Belgium BVBA, UK LTD and French Sarl.
Public Limited Company (NV)
If you are forming a company in the Netherlands with the intention of going “public” then you should incorporate as a Public Limited Company. The shares of your company will be freely transferable without the consent of other shareholders. From a legal point of view a Dutch NV is similar to a Dutch BV and both are subject to standard corporate tax rates. A big difference is the requirement of 45,000 EUR of startup capital and the fact that the directors of Public Limited Company may be held liable for mismanagement in the event that you file for bankruptcy.
General Partnership (VOF)
If two or more partners are planning to do business in the Netherlands then a VOF may be a suitable company formation structure. Partners may be legal entities as well as individuals and there are no requirements for a local partner / director or minimum share capital. A Dutch Partnership is usually not the preferred company structure for performing international business activities but may be the right choice if you are engaged in a local partnership or joint venture. Forming a VOF may also be suitable if you are investing in a local asset such as real estate although a Limited Partnership (CV) may also be ideal for such a scenario.
Limited Partnership (CV)
This type of partnership also requires two or more partners who are categorized as managing partners and silent partners. Managing partners are responsible for the day-to-day running of your business and have unlimited liability under Dutch corporate law. Silent partners, on the other hand, invest in the business but have limited liability as well as a limited role in managing company operations. It is a good idea to have a partnership agreement in place when forming a Netherlands Limited Partnership company. This CV deed should outline partner roles and responsibilities, investments, profit sharing and the length of your partnership.
This type of company structure is formed by two or more partners belonging to a profession and not operating a business, per se. It is the ideal company formation for lawyers, accountants, architects and similar professional partners. You do not need startup capital in order to form a Professional Partnership in the Netherlands. Each partner is treated as an independent entrepreneur although some stipulations such as accomodation and joint profit distribution are governed by the umbrella partnership. A business registered as a Dutch Professional Partnership is allowed to hire staff although as an individual partner you will retain your own customers.
Registering your company in the Netherlands may take the form of an Association if you do not intend to distribute profits to your members. Rather, proceeds from your Association must be used to further the cause that you are promoting which forms the basis of your Association. Two or more members are required to set up a Dutch Association and while you can engage in commercial activities you are not entitled to tax-free donations.
If you already operate an overseas business then a Branch Registration may be the ideal way to form a company in the Netherlands. Registering your business as a branch in Holland is different than forming a Limited Private company as a subsidiary in that your local branch is not considered a separate legal entity under Netherlands corporate law. You do not require any startup capital or local directors / partners in order to register your company as a branch. The corporate law of your home country will apply to your branch in the Netherlands and you are not required to prepare financial statements.
Registering as a foundation in the Netherlands is the ideal business structure for NGOs and charities. A Dutch Foundation is a self-owned legal entity with limited liability like that of a Private Limited Company (BV) but devoid of any shares or shareholders. It is similar to the concept of a foreign “trust” but for the fact that a Foundation is a corporate entity governed by Dutch business law. A Foundation offers anonymity to its owner(s) and may also be used as a legal holding company or a non-profit organization as well as for privacy, asset protection and re-invoicing functions.
Changing Your Company Structure
So which company structure is the right one for you in forming a company in the Netherlands? The above overviews should have provided you with a great starting point and idea of what kind of company to register in Holland. The good news is that Dutch corporate law allows you considerable leeway after company formation in adjusting your business structure as you grow. What this means is that it is relatively easy to change your company structure as your business requirements change
The main legal requirements for forming a company in the Netherlands is incorporation through a public notary and registering with the Chamber of Commerce. The same is true for any changes you wish you make to your company structure under Holland corporate law. A public notary is not required in every case and just like registering your company, making changes to your legal business structure is a relatively straightforward process which can be accomplished in a matter of days for a nominal fee.