| COMPANY LAW |
|
| International operating companies structured through the Netherlands generally prefer to establish a limited liability company, a Besloten Vennootschap (B.V.). We will explain the essential legal consequences of holding and managing a limited liability company, B.V., in the Netherlands. Main characteristics of a limited liability company. B.V., laid down in the law, are: • a minimum issued and paid up capital of EUR 18.000 • liability for shareholders is limited to paid up share capital • transfer and issue of shares is subject to shareholders permission • shareholders are registered in a shareholders register at the companies address |
 |
| Shareholders may be limited companies outside the Netherlands. In these cases bearer shares may be issued on holding company level. | |
| When incorporating a company a declaration of no objection is needed from the Ministry of Justice. The incorporation procedure for a B.V. is finalized by a deed of a notary public, who legally sanctions the articles of association, followed by registration at Chamber of Commerce. Public disclosure at this institute is limited, but include the articles of association, board members, share capital and an annual balance sheet. Shareholder information must be filed if only one shareholder is holding the company. | |
| The articles of association serve as the internal operating document for the company and detail the responsibilities, rights and duties of directors and shareholders. Shareholders vote for the board of directors and, therefore, decide about the management of the company. All activities of the company are executed and controlled by the management board. As a consequence of important responsibilities under the law, such as personal liabilities for certain tax claims, it is required to have a management board in place able to comply with requirements. Veco Trust (N.L) B.V. is specialized to execute, monitor and control activities of a company owned by non-resident shareholders. | |
| In practice this means that Veco Trust (N.L) B.V. is appointed by the shareholders as managing director of the company. In this position all powers to operate the company are granted. Tasks include corporate secretary activities such as providing the registered office of the company and maintaining the corporate records. | |
| A supervisory board may be installed by shareholders if articles of association include a corresponding provision. The supervisory board monitors the company in general. | |
| An important duty for the management board is to comply with accounting and filing requirements. A B.V. must report to shareholders a financial statement on activities and transactions on a yearly basis. Rules for reporting are laid down in the Civil Code and EU regulations apply. Audit may be required if certain conditions are met concerning balance sheet total, turn over and number of employees. A balance sheet must be filed at Chamber of Commerce within 13 months after the book year of the company has ended. Non-filing may lead to severe penalties and important liabilities for the management board. |
|
| At least once a year a general meeting of shareholders must be held. The main objective of this meeting is to decide about the annual accounts and liability discharge of the management board. | |
|
Because Veco Trust (N.L) B.V. is appointed to be involved with day to day businesses of the company, on behalf of a non-resident principal, we exclude all liability which will be agreed in the management and indemnity agreement. |