ARUBA TO INTRODUCE A NEW LIMITED LIABILITY CORPORATION IN 2007
U.S. Limited Liability Company used as model
It is expected that Aruba will introduce a new corporate vehicle on 1 January 2007: the Corporation with Limited Liability (‘vennootschap met beperkte aansprakelijkheid’ or ‘VBA’).
The VBA can be established in a form that resembles what a foreign shareholder encounters in his own legal system: the VBA can, for example, be organized like an Aruban NV, a Delaware corporation, a BVI company or a German GmbH. The motto is: “You request, we provide”. The chameleonic possibilities of the VBA contribute to its attractiveness.
The main object of the legislator is flexibility and maximum freedom of organization and presentation. Accordingly, the draft act contains few mandatory provisions, such as provisions relating to the interests of creditors.
For the formation of a VBA a notarial deed is required. Also, for the formation, a ‘certificate of no objection’ is required, however, not for any amendment of the articles of association. Just one founder is sufficient for the incorporation.
No minimum capital is required. The par value of shares can be expressed in foreign currencies. The Board of the NV or BV can be organized as one-tier board or as two-tier board.
The new law contains provisions with respect to changing of corporation form ({cross-border} conversion), statutory merger and division (splitting).
Freedom of organization with regard to the articles of association is the key concept in the case of the VBA. Anything is possible, unless the law or public order and common decency oppose such. It is not necessary to include all provisions deemed necessary in the articles of association though. If so desired, by-laws (a ‘reglement’) can be used and it is not required that they be filed with the Chamber of Commerce for public inspection.
The laws of Aruba are in full swing. The new act introduces a completely new, contemporary and revolutionary entity with unprecedented possibilities
Karel Frielink
Attorney (lawyer) / Partner
