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7 Things you need to know about the Dutch LLC

7 Things you need to know about the Dutch LLC

by Rick, April 11, 2016

What is the Dutch LLC (BV)

The Dutch version of a limited liability company is called a ‘BV’. Just like a LLC, a BV is a company whereby the shareholders are only (financially) liable for their investment in the company, and not personally liable for any debts, one of the reasons why the Dutch LLC is the most preferred company type for foreigners.

Ok, so who are the owners?

A Dutch LLC is owned by his shareholders whose shares are privately registered. There is at least one shareholder required. The shareholders can be individuals or legal entities, and can be both Dutch or Foreign.

In case of one shareholder, the details of the shareholder are publicly available in the Chambers of Commerce. In case of multiple shareholders, details are not publically available and only the directors of the LLC will listed.

Do I need to bring a lot of cash as share capital?

Since October 2012, when the Dutch Government eased the requirements for the LLC in order to stimulate entrepreneurship, the minimum amount of share capital has been reduced from €18.000,- to €0,01. We advise to incorporate a Dutch LLC with a share capital of €100,- with a nominal value of €1,- per share. When you require a nominal share above €1000,- please inform us, as the incorporation procedure will be slightly different.

Other requirements

A LLC is required to have at least one director. No company secretary is needed. The directorship could be fulfilled by the sole shareholder, or by appointed directors.

The director(s) have in principle unlimited power to represent the company, unless restricted by the articles of association, or additional shareholder and management agreements.

Registered address
A Dutch LLC is required to have its company address in the Netherlands. This should be a physical address; no postal box is allowed.

What are the legal and fiscal obligations?

The LLC has the legal obligation to prepare an annual report, and submitting the financial statements to the company register at the Chambers of Commerce. In case the LLC is classified as VAT entrepreneur, the LLC is in principle obliged to file a VAT return
every quarter

Audit must be performed by external auditors when (2 out of 3 requirements must be met) the company’s turnover exceeds EUR 12 million, the balance sheet totals over EUR 6 million and the average number of employees is 50.

All clear, how can I start the incorporation?

A Dutch LLC can only be incorporated by a notary public. Once all shareholders have agreed on the draft deed of incorporation, the deed will be executed by the notary. Once incorporated the LLC will be submitted at the trade register and tax authorities. A notary public can execute the deed based on a Power of Attorney, so no actual presence is needed.

To start the incorporation process of a Dutch LLC we only require information such as the number of shareholders, details per shareholder and main activities of the LLC. The deed will be, according to Dutch law, drafted in Dutch. However a translation is required since the shareholders must understand what they are signing for. If you wish to review a free draft of the articles of association, please contact us.

The incorporation process can be finished within a week, but is highly dependable on the specific situation, the possibility to sign a power of attorney for the incorporation and fulfil the identification requirements.

Awesome, Coca Cola BV sounds good!

Unfortunately, it is not allowed to register a company or trade name that is already used by another Dutch LLC, or that is listed as an official trade name. Check If your desired company name it still available with our LLC name check tool at the start of the incorporation process.

The name should always end or start with “BV”. Next to the name you can register an additional trade names which allow you to act as multiple brands under one legal entity.

More information about a Dutch LLC? See advantages of a Dutch LLC.

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