INQUIRY PROCEDURE INTRODUCED IN CURACAO
The Joint Court is the forum of choice for corporate disputes
As per January 1, 2012 the amended Corporate Code (Book 2 Civil Code) of Curacao entered into force. The new legislation introduces a so-called inquiry procedure for, amongst others, limited liability companies. The inquiry procedure (a.k.a. investigation proceedings) can result in a court ordered investigation into the affairs of a corporation.
Shareholders of such a corporation (i.e. an NV or BV) may file a petition with the Joint Court of Justice of Aruba, Curacao and St. Maarten, and of Bonaire, St. Eustatius and Saba (the ‘Joint Court’). Pursuant to …
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FINAL POSTING OF 2011
What a year!
This will be my final posting for 2011. What a year. It feels as if the whole world has changed more rapidly than ever before and not only as a result of the Arabic Spring and the economic turmoil.
The year 2012 is about to begin and it won’t be an easy year. Many will suffer from the crisis and many will keep suffering from oppression, diseases and natural disasters. There still will be tensions between countries and populations. There still will be war. However, new faces and new voices in the political arena may change things …
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APPELLATE PROCEEDINGS IN THE DUTCH CARIBBEAN
Full review of the case
Appellate proceedings in the Dutch Caribbean provide for a full review of the appealed decision: the grounds on which the Appellate Court can reverse the original judgment are not, as in certain other jurisdictions, limited to procedural matters. It is furthermore permissible to introduce new documentary evidence in the course of appellate proceedings. If the appealed judgment contains a final decision as regards the dispute the Appellate Court will either confirm the judgment or it will itself render a replacing decision: the case will not be referred back to the Court of First Instance.
Furthermore, …
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INSURANCE BUSINESS IN ARUBA (II)
Different insurance contracts
According to the SOSIB a “life insurance agreement” is an insurance contract concerning the payment of cash benefits related to the life or death of man, and a “general insurance contract” is an insurance contract, other than a life insurance contract.
Generally, an insurance contract is understood to be an agreement whereby an insurer commits itself to the insured, against receipt of a premium, to compensate the latter for a loss, damage or loss of expected advantage which the insured could suffer as a result of an uncertain event.
There is no existing case-law or regulatory directive …
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INSURANCE BUSINESS IN ARUBA (I)
The Central Bank of Aruba is the regulator
The Central Bank of Aruba supervises insurers incorporated in Aruba and the branches and agencies in Aruba of insurers incorporated outside Aruba based on the State Ordinance on the Supervision of the Insurance Business (SOSIB).
The SOSIB, effective since 2001, stipulates that life and non-life insurance business must be carried out by separate legal entities. The Central Bank of Aruba shall decide whether an action or a combination of actions does or does not constitute as being engaged in the life insurance business or the general insurance business, and whether an action …
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CREDIT INSTITUTIONS IN ARUBA
A license is required
According to Section 4 of the Aruba State Ordinance on the Supervision of the Credit System 1998 (SOSC), no enterprise or institution established in Aruba shall pursue the business of a credit institution unless it has obtained authorization to that end from the Central Bank. No enterprise or institution established outside Aruba shall pursue the business of a credit institution through a branch in Aruba, unless it has obtained authorization from the Central Bank to do so (Section 24(1) SOSC).
A “credit institution” under the SOSC means an enterprise or institution, not being an institution established …
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LEGAL MERGERS IN CURACAO
The Curacao Civil Code provides for a simplified merger procedure
The acquisition of a business enterprise may take place through the purchase of shares (take-over), the purchase of assets and liabilities or a legal / statutory merger. The Curacao Legal Code on corporate and other legal persons contains detailed provisions for mergers of companies limited by shares (NV) and private limited companies (BV).
Basically, a legal merger entails the absorption of one legal entity by another in exchange for shares, or even without such exchange. The absorbed entity ceases to exist. A legal merger requires a notarial deed. Legal mergers …
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THE CURACAO MEMBER-MANAGED COMPANY
The right form for small businesses
Until March 1, 2004 only manager managed companies were known. According to the current Curacao Civil Code, the articles of a company may provide that such company be a member managed company, which is a company without a board of directors. The shareholders (members) are then in charge of the company, including its day-to-day affairs. A member managed company is suitable for smaller companies, e.g. family businesses, with only one or a few shareholders.
If such designation is absent in the articles of a company, the company will be a manager managed company. The designation …
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THE CURACAO PRIVATE FOUNDATION
A Private Foundation can be used for tax planning and asset protection The Curacao Private Foundation was introduced by the National Ordinance Regarding Foundations as published on October 31, 1998. Since March 1st, 2004, these rules are laid down in Book 2 of the Curacao Civil Code. The Private Foundation possesses corporate personality but does not have share capital. The Private Foundation is incorporated by deed executed before a Curacao public notary and is registered in the Register of Foundations at the Curacao Chamber of Commerce. The object of the Private Foundation may include a number of activities, and is …
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THE ENFORCEMENT OF A JUDGEMENT BY THE COURTS IN CURACAO
Judgments are immediately enforceable most of the time
According to Article 55, par. 1 of the Curacao Code of Civil Procedure, opposition (in the case of a default judgment) or appeal (in the event of adversarial proceedings) prevent the enforcement (execution) of a judgment unless the decision is ‘enforceable notwithstanding opposition or appeal’ a.k.a. a judgment which is declared ‘immediately enforceable’ (‘uitvoerbaar bij voorraad is verklaard’).
The submission of an appeal results, therefore, in a stay of execution, unless the first-instance court, on a motion by one of the parties, has declared its judgment enforceable even if it is challenged …
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THE DUTCH CARIBBEAN JUDICIAL SYSTEM
A well developed system
The judicial system of the various islands in the Dutch Caribbean (Aruba, Bonaire, Curacao, St. Maarten, Saba and St. Eustatius) is independent, has a long history, and is well developed. It is capable of resolving complex commercial disputes in a just and efficient manner. The judges in the Dutch Caribbean are well-trained, professional judges.
In general, parties in civil proceedings have the right to appeal to the Joint Court of Appeal of Aruba, Curacao and St. Maarten and of Bonaire, Sint Eustatius en Saba (‘Gemeenschappelijk Hof van Justitie van Aruba, Curacao en St. Maarten en van …
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CREDIT INSTITUTIONS IN CURACAO AND ST. MAARTEN
A license is required
The National Ordinance on the supervision of banking and credit institutions 1994 (Landsverordening toezicht bank- en kredietwezen, the “NOSB”) of both Curacao and St. Maarten prohibits any one (other than a licensed Credit Institution) from – directly or indirectly – soliciting funds from the public or extending credit to the public (art. 45 NOSB).
It should be noted that the Explanatory Memorandum to the NOSB bestows a wide scope on the term “public”, i.e. anyone other than a licensed Credit Institution. The Central Bank of Curacao and St. Maarten may grant individual exemptions from this prohibition. …
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