TRUST COMPANIES IN THE DUTCH CARIBBEAN
A license is required
One or more Netherlands Antilles legal entities or companies (offshore companies) are inserted in many international group structures. This is mainly done for tax purposes. Another reason for using a Netherlands Antilles company may be to have a company with a seat in a respected jurisdiction with a well functioning legal and court system. The ‘ultimate beneficial owner’ of these companies will generally, directly or indirectly, put the board of these Netherlands Antilles legal entities and the administration of these companies in the hands of company service providers a.k.a. trust companies.
Netherlands Antilles company law grants the management boards of companies, NVs (which are public limited liability companies) or BVs (private limited liability companies), the authority to determine their own policy. However, the management board may be bound (in fact) to act upon the instruction of another company or person. This is common practice for subsidiary companies within a group structure. There is the factual power of instruction of the (grand) parent company (an unwilling board member may be suspended or dismissed by the general meeting of shareholders). This is also common practice for (offshore) companies whose board member is a trust director.
The supervision of trust companies is dealt with in the National Ordinance on the Supervision of Trust Service Providers 2003 (‘Landsverordening toezicht trustwezen’, the ‘NOST’). Supervision of trust companies (a.k.a. fiduciary service providers) falls in the category integrity supervision and not in the category prudential supervision. The supervisor is the Central Bank of the Netherlands Antilles. The ordinance prohibits anyone from rendering fiduciary or trust services without a license.
Karel Frielink
Attorney (Lawyer) / Partner
