C.V. COMPANIES (LIMITED PARTNERSHIP) - structure - taxes Structure In order to establish the Netherlands Limited Partnership, a partnership agreement will have to be signed between two (or more) partners, of whom at least one will be the limited partner and one the general partner. A Netherlands partnership or C.V. is considered a corporate entity under foreign law, provided that the legal independence of the entity from its partners is sufficiently emphasised in the set up of the partnership. However, if well structured, a C.V. may be considered fiscally transparent in the Netherlands. Consequently, the C.V. is not taxed at the level of the C.V. but at the level of the partners. For this purpose, the C.V. will have to be structured as a so-called “closed” C.V., of which the general partner is not a resident of the Neherlands, while the limited partner would not be considered to have a permanent establishment in the Netherlands through the activities of the general partner. The general partner can either be an individual or an offshore company, which does not appear on the local blacklist and which can be provided through a member of our group, as long as there are no liabilities or obligations involved. In principle, the general partner will have his own responsibility based on the partnership agreement. However, in the side letter (or indemnity agreement) between the limited partner and the general partner it can be determined that the limited partner may only act upon instructions from the general partner(s). Dutch law permits that the total amount of the capital to be contributed to the C.V. be divided in participations of a specified nominal value, the transferability of which is subject to certain (strict) conditions. To facilitate the transferability of such participations, depositary receipts for participations may be issued to e.g. the family members of the limited partner(s). The C.V. is allowed to open bank accounts. In order to keep the responsibility of the partners limited to the amount of their partnership contribution it could be important that the limited partner refrains from active management. However, as we assume that no liability is created for the limited partner by having him only sign on the bank account, exceptions can be made. The limited partner can be authorised by means of a power of attorney, issued by the general partner.