Setting up a company in The Netherlands

Setting up a company abroad should always be done with due care. Being unfamiliar with local rules, regulations and culture, starting a business from scratch can be experienced as difficult and frustrating. In this blog, Dutch business lawyer Hidde Reitsma explains all you need to know on the legal forms a Dutch company, how to incorporate a company, and how to get the business going.

From business plan to business in The Netherlands

It goes without saying that making a well-founded business plan should always be the starting point when setting up a business. Apart from a good business plan, however, it is also essential to have the most important practical and legal issues properly arranged.

Choosing the right form for your company

In the first place, the legal formation of the new business must be chosen. All companies in The Netherlands should be registered with the Trade Register (the Dutch equivalent of the Companies’ House). In most cases, the lawyer taking care of the formation or incorporation of the company will take care of this registration. A business can be carried out by and for the risk of an individual as a soletrader (‘éénmanszaak’), or in a partnership (‘V.O.F.’). Many entrepreneurs, however, choose for a legal form with corporate capacity, such as the Dutch private limited liability company (‘besloten vennootschap’, or ‘B.V.’). The choice of the legal formation depends mainly on the type of business you intent to start, the scale of the business and the (legal) risks involved. There are generally no restrictions on starting up a business that is owned or controlled by a foreign shareholder.

Setting up a Dutch limited company (BV)

The most common business formation with corporate capacity in The Netherlands is the BV. A BV is incorporated by a notarial deed, containing its articles of association A document, drawn up when a Dutch company or legal person is set up, and which regulates the operations of the company and defines its purpose.
» Meer over articles of association
Articles of Association
. As per 1 October  2012, the BV has no mandatory minimum capital. The company must annually publish its (shortened) financial statements.

General terms and conditions

It is advisable to have suitable general terms and conditions drawn up. When starting up a new business in The Netherlands, we always advise to consult a lawyer to draw up these conditions, or to check whether modifications should be made on an existing set of conditions (as may be used by the mother company abroad) in order to be completely valid under Dutch law.

Business premises in The Netherlands

When setting up a company in The Netherlands, the company must have a registered business address in order to have the company registered in the Trade Register (the Dutch equivalent of the Companies’ House). Most companies rent their business premises. AMS specializes in tenancy law for business premises. We can be of assistance with negotiating a tenancy agreement and check whether the contract used is well balanced.

Proper business administration

It is important to set up a proper business administration, as Dutch law requires that each company shall have a proper and up to date administration. The managing board must take into consideration what kind of taxes will be due (such as VAT or wage taxes) and the board is obliged to keep books and documents (invoices etc.) for at least seven years.

Assistance in setting up a business in The Netherlands

The subject mentioned above are some of the most important points to deal with when starting a business in The Netherlands. Most issues can pretty easily be arranged, when you have the right contacts. Dutch law firm AMS can be of assistance with detailed checklists and tailor-made legal advice.

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