For the third year in a row, the Netherlands featured among the 10 least complex jurisdictions in our annual Global Business Complexity Index (GBCI).
With its open economy, the Netherlands is renowned as one of the world's leading financial centres and a jurisdiction that hosts a sizable international business community. The country boasts sophisticated infrastructure and a well-educated populace, that is widely considered to be pragmatic, tolerant and open-minded. The country's competitive fiscal climate and friendly business environment make it an attractive location for multinationals to place their European or global headquarters.
Steps for incorporating in the Netherlands
Starting a business in The Netherlands is a relatively straightforward process and can typically be completed within a few days.
The most common types of business entities when entering the Dutch market include a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid, or BV) and a public limited liability company (naamloze vennootschap, or NV), among other types.
For a BV, no initial minimum capital investment is required at the time of incorporation. Shareholders and directors can be Dutch or non-Dutch or even corporate entities.
The required steps for incorporation in the Netherlands are as follows:
- In the case of a public limited liability company (NV), depositing the minimum capital required in the bank
- Checking the company name for appropriateness and validity on the website of the Netherlands Chamber of Commerce (KvK)
- Drafting and signing the company's deed of incorporation, including the company's Articles of Association, executed by a civil law notary
- Registering the company in the commercial registry at the local Chamber of Commerce, and obtaining a registration number
- Registration with the local tax authorities and the social security authorities
Within five days of filing the incorporation documents, the Chamber of Commerce will send an official copy of your excerpt from the Commercial Register, which verifies that the company has been officially registered as a legal entity.
Challenges in opening a bank account
As in many jurisdictions, opening of a bank account in the Netherlands is necessary for conducting business in the country, but can present challenges.
To conduct business in the Netherlands, an IBAN, or international bank account number, is required.
If a relationship with a bank in the Netherlands already exists, opening a bank account may be less complex; however, if there's not yet a relationship, it can take anywhere from a few weeks to up to two months to open an account, as banks may scrutinise an applicant's funding sources and business plans.
As an alternative, a bank account can be opened with one of the various Netherlands-based fintech banks. TMF Group partners with a number of fintech banks and can assist in fulfilling the client acceptance process.
Advanced digitalisation
As noted in our Global Business Complexity Index, the Netherlands is a highly digitalised commercial environment. The recently introduced Ultimate Beneficial Owner (UBO) register is already digitalised, with relevant individuals only having to submit a scanned passport copy to be identified – a process which can also be done from abroad. Board meetings are permitted digitally as well as physically. This digital ecosystem meant that the Dutch authorities have coped well throughout the pandemic, with entities incorporated and operating largely in 'business as usual' mode.
That said, during incorporation, it is required for shareholders to appear in person, or to provide a power of attorney to a notary in person. The registration of the company's directors is also by way of forms that must be provided to the Chamber of Commerce, in wet ink.
Overall, the Netherlands offers a stable, internationally focused business environment and sophisticated infrastructure for investors and companies that wish to expand both in Europe and beyond.
TMF Netherlands
For companies operating in the Netherlands it's essential to keep up with changing regulatory requirements and take the necessary steps to stay fully compliant.
TMF Group helps international companies comply with Dutch compliance requirements with a full suite of services. In addition to our global portfolio of services, our Dutch office provides extra support, tailored to specific local requirements.
Contact our experts today to find out how we can help grow your business.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
