THE CHOICE BETWEEN A PARTNERSHIP AND A COMPANY IN THE NETHERLANDS ANTILLES
Tax and other issues should be considered
What are the choices for a businessman under the laws of Netherlands Antilles for the establishment of a business venture?
The choices are:
– sole proprietorship (‘eenmanszaak’)
– a general partnership (‘vennootschap onder firma’)
– a limited partnership (‘commanditaire vennootschap’)
– a limited liability company, either private or public
It is generally believed that partnership law by its nature is more flexible than corporate law since it may enable the parties to tailor the structure of their cooperation completely to their needs. This is not true for Netherlands Antilles corporate law.
Contrary to what one might expect, the Antillean public limited liability company (‘NV’) and private limited liability company (‘BV’) do not resemble the Dutch NV and BV. They are completely new, contemporary and revolutionary entities with unprecedented possibilities. The main object of the legislator was flexibility and maximum freedom of organization and presentation. Accordingly, the Act contains few mandatory provisions, such as provisions relating to the interests of creditors and minority shareholders.
The Antillean NV or BV can be established in a form that resembles what a foreign shareholder encounters in his own legal system: the NV or BV can, for example, be organized like a Dutch NV, a Delaware corporation, a BVI company or a German GmbH. The BV can even resemble a partnership. The motto is: ‘You request, we provide‘. The chameleonic possibilities of the NV and BV contribute to their attractiveness. This is a factor to consider as well as taxation issues.
Another factor that may warrant attention in choosing the appropriate legal form is the differences in liability of the joint venture parties in a partnership and a company (legal entity). Shareholders is are not personally liable for the liabilities of the NV or BV. Finally, it may be difficult for a partnership to have its intellectual property rights registered and also certain licenses may only be granted to legal entities. Netherlands Antilles corporate law gives the best of both worlds.
Karel Frielink
Attorney (lawyer) / Partner
