SUPERVISORY DIRECTORS OF A CURACAO INSURANCE COMPANY
The Central Bank has issued guidance notes
According to the Curacao Ordinance on the Supervision of the Insurance Business, a Board of Supervisory Directors of an insurance company shall have the task of supervising the policy of the Management Board of such company and the general course of events of the insurance company and the business associated with it. It shall advice the Management Board. In carrying out its duties the Board of Supervisory Directors shall take into account the interests of the insurance company and the business associated with it (Article 16 par 4 Ordinance).
‘The actions and records of …
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PROPOSED REVIEW CORPORATE CODE ON ULTRA VIRES
The rules with regard to ultra vires are fundamentally changed
Ultra vires means ‘beyond power or authority’. An ultra vires act is one beyond the purpose clause as laid down in the Articles of Association of a legal entity, for instance a foundation or a limited liability company (NV or BV).
Early in 2010, a draft bill was proposed to amend the Corporate Code (Book 2 Civil Code) of Curacao, St. Maarten, Bonaire, St. Eustatius and Saba (which formerly constituted the Netherlands Antilles). Among other things, the provisions with regard to ultra vires acts (transgression of the object) have been …
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ELECTRONIC AGREEMENTS IN CARACAO AND SINT MAARTEN
The Dutch Caribbean digital signature exists for over 10 years
The Curacao Ordinance on Electronic Agreements a.k.a. the Curacao Ordinance on agreements concluded electronically (Landsverordening overeenkomsten langs elektronische weg) became effective on 1 January 2001. The Ordinance in St. Maarten is similar to the one in Curacao.
The Ordinance provides that an electronic signature shall have the same legal effect as a hand-written signature, and may be admitted as evidence in legal proceedings. An electronic signature is described as electronic data which are attached to or have a logical association with other electronic data and are used as a tool …
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VOLUNTARY DISCLOSURE AND THE HUNT FOR UNDISCLOSED ACCOUNTS BY US AND DUTCH TAX AUTHORITIES
Propaganda machines up to speed
Publicity efforts by the US and Dutch tax authorities indicate that the hunt for undisclosed accounts in typical offshore jurisdictions is still a hot item. Although Curacao was not mentioned by the US authorities, the Dutch tax authorities announced a new search for undisclosed accounts in Curacao based on information provided by the French tax authorities. The IRS announced a new voluntary disclosure program which mitigates the risk of criminal prosecution in exchange for paying taxes, interest and a standardized penalty. Furthermore, the IRS announced that they will follow ‘new leads’ emanating from voluntary disclosures. …
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THE DUTCH CARIBBEAN AND ROME I AND ROME II
Nothing has changed as of 10-10-10
The Country the Netherlands Antilles consisted of Bonaire, Curacao, St. Maarten, St. Eustatius and Saba, and formed part of the Kingdom of the Netherlands. On October 10, 2010 the Netherlands Antilles ceased to exist as a country. Two new countries were born on that date: the country Curacao and the country St. Maarten. The three remaining islands (Bonaire, St. Eustatius and Saba, a.k.a. the BES-islands) became special overseas territories (sort of municipalities) of the Netherlands. The question is whether the new status of the islands mentioned means that treaties to which the Netherlands is …
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INTERNATIONAL NON-CONTRACTUAL LIABILITY FROM A DUTCH PERSPECTIVE
Introduction
Financial law is not an exclusively national affair. Cross-border transactions and service provisions have been common place for a very long time. Harmonisation of rules has been worked towards in a European context for decades. Leaving aside special subject matters such as liability for products and road accidents, the (partial) harmonisation of the rules in respect of the cross-border tort (wrongful act) has only relatively recently been realised.
Rome II, which concerns the law applicable in respect of non-contractual obligations, has been in force in the Netherlands since 11 January 2009. It applies to non-contractual obligations which have arisen after that …
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A PUBLIC LIMITED LIABILITY COMPANY AND LEGAL PERSONALITY
Dutch Supreme Court, Decision of 18 January 1901
Suppose you and several of your friends decided to combine your financial resources to start a business. You subsequently agreed on the incorporation of a limited liability company (NV). You also agreed on the amount each of you would put into the NV and the number of shares each of you would receive in return for this capital contribution. You and your friends then visited the civil law notary and a notarial deed incorporating the NV was executed. The NV now exists.
However, although you and your friends paid their respective capital …
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GOOD CORPORATE GOVERNANCE REVISITED
Where these rules not designed to protect companies from the government?
It has been my opinion for many years already that government-owned companies should be kept out of the political sphere as much as possible, so that they may benefit from a commercial, businesslike and market-oriented management. In doing so they also run less of a risk of being milked or used as political toys.
When the current government of Curacao came into power a couple of months ago, it made it very clear, right from the beginning, that it intended to dismiss all and any supervisory directors of both …
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REQUESTS FOR INFORMATION BY FOREIGN TAX AUTHORITIES
A request for information needs to contain specific information
The former Netherlands Antilles concluded several tax information exchange agreements (‘TIEA’) during recent years. These TIEAs also apply to the newly formed country Curacao. The Tax Arrangement for the Kingdom (‘TAK‘) is applicable within the Kingdom of the Netherlands, which includes Curacao. Article 37 of the TAK also contains the facilities for the exchange of information within the Kingdom.
Without a TIEA in place or a specific article in a double tax treaty facilitating the exchange of information between the treaty parties, the Curacao tax authorities would be prohibited from effectively exchanging …
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PROPOSED REVIEW DUTCH CARIBBEAN CORPORATE CODE
Various proposals not yes discussed here
The prohibition of appointing Supervisory Directors besides a ‘one-tier Board’ will be deleted (Article 2:19 paragraph 1 proposed bill). Supervisory Directors being a legal entity are allowed to a limited extent (Article 2:19 paragraph 3 proposed bill).
For the NV and the BV the law determines who has the right to attend meetings (Article 2:129/229 proposed bill). Unfortunately, in this connection no attention is given to the holders of depositary receipts for shares. In the case of concurred depositary receipts (i.e. certificates released with the co-operation of the corporation) I would prefer to grant the holders …
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PROPOSED REVIEW DUTCH CARIBBEAN LEGISLATION ON CONFLICTING INTEREST
The proposed bill gives shareholders more freedom
Earlier in 2010, a draft bill was proposed to amend the Corporate Code (Book 2 Civil Code) of Curacao, St. Maarten, Bonaire, St. Eustatius and Saba (which formerly constituted the Netherlands Antilles). Among other things, the provisions with regard to conflicting interest have been thoroughly reviewed and strongly curtailed.
The basic rule provides that the authority with regard to certain legal acts involving the legal entity and its Managing Director (e.g., agreements between the legal entity and its director) as well as lawsuits between a legal entity and its Managing Director rests with …
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PROPOSED REVIEW DUTCH CARIBBEAN LEGISLATION ON DIRECTORS’ LIABILITY IN BANKRUPTCY
Defects detected in the annual accounts drawn up may be relevant
Earlier in 2010, a draft bill was proposed to amend the Corporate Code (Book 2 Civil Code) of Curacao, St. Maarten, Bonaire, St. Eustatius and Saba (which formerly constituted the Netherlands Antilles). Hopefully, the Bill comes into force in 2011. Among other things, the provisions with regard to Managing Director’s liability have been improved.
In the event of the bankruptcy of the legal entity each Managing Director is jointly and severally liable to the estate for the deficit being the amount of the debts insofar as they cannot be …
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