INVESTMENT COMPANY REGULATIONS IN THE NETHERLANDS ANTILLES
Holding companies are not investing
An investment company is a company that raises or has obtained pecuniary means or other property to be used for collective investment with the objective of allowing the participants to benefit of the revenues of the investments.
The Netherlands Antilles National Ordinance Supervision of Investment Institutions and Administrators (‘Landsverordening Toezicht Beleggingsinstellingen en Administrateurs’) and the policy guidelines based thereon do not make entirely clear what will be regarded as an “investment”.
The explanatory memorandum to the Ordinance explains that certain activities do not tend to be referred to as “investment”, such as holding companies. Administrators are subject to supervision as well. “Holding companies”, “securities brokers” and “venture capital companies” have been expressly excluded, whether in the Explanatory Memorandum to the Ordinance or by the Central Bank, from the definition of Investment Institutions.
However, it should be noted that the Ordinance treats administrators separately and hence, that an administrator to an exempted Investment Institution may be regulated. For example, general exemption is available to Investment Institutions (i) for which money or other pecuniary means are raised and obtained in a “restricted circle”, or (ii) for which participating interests are solicited or obtained from “professional parties” only, i.e. natural persons who, or legal entities which, in pursuit of their occupation or business deal or invest in investment objects.
Furthermore, Investment Institutions that offer their participating interests only or also to natural persons and/or legal entities considered by the Central Bank to have comparable skills and competency as the professional parties to form their own balanced opinion about the offer being made, may in individual cases be exempted. In determining whether an institution qualifies for this exemption, the Central Bank particularly considers the target group to whom the institution’s participating ‘interests are offered. This exemption, which is strictly spoken individual dispensation, is available only if the minimum initial subscription amount is at least US$ 50,000 (or its equivalent in another currency).
Karel Frielink
Attorney (Lawyer) / Partner
