MANAGEMENT AND SUPERVISION OF THE ARUBA COMPANY WITH LIMITED LIABILITY
A local representative is required
On January 1, 2009 the new Aruba Ordinance on companies with limited liability (vennootschap met beperkte aansprakelijkheid; VBA) became effective.
The Board of Directors is responsible for the management of the VBA and is authorized to represent it, with the exception of any restrictions in the articles of association. The Board may consist of natural persons and/or legal entities. A VBA must have as local representative, an Aruban corporation (NV or AVV). The bylaws and business license explicitly provide for the representation of companies, unless the VBA either has one or more directors with their residence in Aruba, or one of more companies as director, of which companies one or more directors have their residence in Aruba.
The Board of the VBA may be organized as a one-tier board or as a two-tier board. In the first case (the Anglo-Saxon system) there is a Board of Directors, of which a minority may be charged with the day-to-day affairs. The latter members may be collectively called the Executive Board, which is responsible for managing and representing the VBA, in accordance with any restrictions in the articles of association. The two-tier management structure is the traditional system in the Netherlands, the Netherlands Antilles and Aruba, whereby supervision of the Board is conducted by a Supervisory Board.
Restrictions under the articles of association and statutory restrictions of the representative authority may be invoked against third parties, the so-called external effect. In what is known as the ‘guideline system’ in EU directives, which has been implemented in the Netherlands, such external effect has only been assigned to a few specific restrictions of the representative authority.
Karel Frielink
Attorney (Lawyer) / Partner
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