Unraveling Business Structures in the Netherlands

Embarking on a business venture or establishing a holding company in the Netherlands opens doors to a wealth of opportunities in the heart of Europe. However, understanding the intricacies of Dutch company types and holding structures, along with their associated requirements, is paramount for success. In this comprehensive guide, we’ll delve into the various types of companies and holdings in the Netherlands and outline the steps required to establish them.

1. Types of Companies:

a. Private Limited Company (Besloten Vennootschap or BV):

The BV is one of the most common and flexible business structures in the Netherlands. It offers limited liability to its shareholders, who are not personally liable for the company’s debts. Setting up a BV involves drafting articles of association, appointing directors, and registering the company with the Dutch Chamber of Commerce.

Requirements:

Articles of association.

Minimum share capital of €0.01.

At least one director and one shareholder (can be the same person).

Dutch business address.

Registration with the Dutch Chamber of Commerce.

Tax registration (VAT, corporate income tax).

b. Public Limited Company (Naamloze Vennootschap or NV):

Similar to a BV but typically used for larger-scale enterprises or publicly traded companies. An NV may issue shares to the public and is subject to more stringent regulatory requirements. Establishing an NV involves similar procedures to setting up a BV, including drafting articles of association and registering the company with the Dutch Trade Register.

Requirements:

Articles of association.

Minimum share capital (at least €45,000).

At least one director and one shareholder (can be the same person).

Dutch business address.

Registration with the Dutch Chamber of Commerce.

Compliance with additional regulatory requirements for listed companies.

c. Holding Company (Holding BV):

A holding company is primarily established to own and manage investments in other companies, typically subsidiaries or affiliates. Holding companies in the Netherlands enjoy various tax benefits and exemptions, making them an attractive choice for international investors. The process of setting up a holding company is similar to that of a BV.

Requirements:

Articles of association specifying the holding’s objectives.

Minimum share capital of €0.01 (similar to a BV).

At least one director and one shareholder (can be the same person).

Dutch business address.

Registration with the Dutch Chamber of Commerce.

Tax registration (VAT, corporate income tax).

2. Types of Holdings:

a. Operational Holding:

An operational holding company is actively involved in managing and controlling its subsidiary companies. It may provide strategic direction, financial oversight, and centralized services such as human resources, finance, and marketing to its subsidiaries.

b. Financial Holding:

A financial holding company primarily engages in financial activities such as investing in securities, providing loans, or holding intellectual property rights. Financial holding companies often focus on maximizing returns on investments and managing financial risks across their portfolio.

c. Mixed Holding:

A mixed holding company combines elements of both operational and financial holdings. It may have subsidiaries engaged in diverse business activities, including operational ventures and financial investments.

Conclusion:

Establishing a company or holding in the Netherlands offers a gateway to the European market and a favorable business environment with robust legal frameworks and tax incentives. Whether you opt for a BV, NV, or holding company structure, each entity type provides unique opportunities for growth, investment, and asset protection. By understanding the requirements and nuances of Dutch company law, entrepreneurs and investors can navigate the Dutch business landscape with confidence and set the stage for long-term success and prosperity.

Article by Alfonso Martinez Ruiz

Co-Founder & CFO at Ignaszak Law Company

Amsterdam, March 2024