THE DISMANTLING OF THE NETHERLANDS ANTILLES
The Country known as the Netherlands Antilles will disappear as of 10-10-10
The country, the Netherlands Antilles, consists of Bonaire, Curacao, St. Maarten, St. Eustatius and Saba, and forms part of the Kingdom of the Netherlands. On 10 October 2010 the Netherlands Antilles will no longer exist. Two new countries will be born on that date: the country Curacao and the country St. Maarten. Both new countries will be part of the Kingdom of the Netherlands; however, they will each have their own government and legislature. The island of Aruba gained similar autonomy in 1986.
The legislation currently in place in the Netherlands Antilles (Civil Code, Administrative Code, Penal Code, Code on Civil Procedure, Regulatory Codes etc.) will become the legislation of Curacao and Sint Maarten respectively. The ‘cooperation regulation’ provides for uniform legislation between the countries Aruba, Curacao and St. Maarten.
The three remaining islands (Bonaire, St. Eustatius and Saba, a.k.a. the BES-islands) will become special overseas territories (sort of municipalities) of the Netherlands. The BES-islands will become a Dutch public entity, which will lead to the gradual introduction of Dutch law on these islands. These territories, as well as Curacao and St. Maarten, will maintain the (limited) status of ‘Overseas Communities and Territories’ within the European Union.
Under the new constitution, Curacao and St. Maarten will cooperate on several levels and together with the BES-islands will have a Common Court of Appeal (the Supreme Court will remain in The Hague). Curacao and St. Maarten will have a shared Central Bank. A new monetary unit – probably the Dutch Caribbean guilder – will replace the current Netherlands Antillean guilder in both countries.
The current reform will not affect companies in the Netherlands Antilles: a company with its statutory seat on Curacao will become a Curacao company, and a company with its statutory seat on St. Maarten will become a St. Maarten company. Such a company may still establish a branch on any of the other islands. There will be tax reforms on all of the islands, although the exact nature thereof is not yet clear. As far as (tax) treaties are concerned, Curacao and St Maarten will assume the international obligations previously undertaken by the Netherlands Antilles.
The (successor of the) Netherlands Antilles Central Bank will continue to supervise banks, funds etc. on Curacao and St. Maarten. Supervision on the BES-islands will be carried out by the Dutch Central Bank (DNB) and the Dutch Authority for the Financial Market (AFM), except for branches of banks etc. already subject to home country supervision on Curacao or St. Maarten.
The “Concluding Statement” or “Slotverklaring”, which was signed between Curacao, St. Maarten, and the Netherlands in November 2006, provides for debt relief and gives Curacao and St. Maarten the opportunity to eliminate their unsustainable debt and start afresh with a new constitutional status with a clean slate. The Netherlands has reserved funding to pay the accrued interest and the greater part of the outstanding debts of Curacao and St. Maarten.
All in all, foreign investors and shareholders have nothing to fear. Despite their new constitutional status, the islands will continue to offer many (regional) advantages.
Karel Frielink
Attorney (Lawyer) / Partner
(30 September 2010)
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