General

How does a corporate emigration from the Netherlands work?

There are two commonly used methods of moving your Dutch business from the Netherlands. On the one hand there is the ordinary migration by moving the company’s principal place of management.  On the other hand you can opt for a cross-border migration and conversion pursuant to which a Dutch Company will convert itself into a Company governed by the laws of another Member State of the European Union or the European Economic Area.

The Ordinary Migration Procedure

An implicit migration is effectuated in three steps. The first step is taken by holding a board meeting. The board must express its intention to transfer the place of effective management, pin-point an “emigration date” and name the jurisdiction in which it wishes to re-domicile. Following this meeting the board must issue a written statement in which they confirm their resignation and the aforementioned emigration date. The second step consists of holding a shareholders meeting in the Netherlands in which the resignation of the sitting directors is approved, the emigration date is confirmed, as well as the appointment of new directors. The shareholders must also approve the transfer of all records and the closure of all Dutch bank accounts. It is important to document the address of the new business space and open bank accounts in the new domicile.  The third and last step consists of several practical matters. New offices must be arranged, the Dutch company must be deregistered with the Dutch Chamber of Commerce and adjustments should be made listing the new directors and new business address. This deregistration in the Netherlands is logically followed by registration with the Chamber of Commerce in the new domicile. In short, the last step consists of effectuating all decisions made by both the board of directors and the shareholders.

Services provided by KC Legal

  • Preparation the board and shareholders resolutions for migrating the Dutch company;
  • All registrations with the Dutch trade registry;
  • Preparing and filing the account of liquidation with the trade registry;
  • Preparing and filing the emigration and post-emigration corporate income tax returns.

The Cross Border Conversion Procedure

When it comes to the option of cross-border conversion, the aim is to convert a Dutch Company into a Company governed by the laws of another Member State of the European Union or the European Economic Area. Dutch law does not specifically provide rules for a cross-border conversion. However, according to the judgement rendered by the European Court of Justice in the “Cartesio case”, an EU Member State of incorporation may not prevent a Company from converting itself into a Company under the laws of another Member State. (to the extent that it is permitted under the laws of such other Member State to do so.) Taking the above into account, the following steps need to be taken in order to effectuate the cross-border conversion: The first step is to obtain a statement by a notary who is licensed in the relevant foreign jurisdiction. This statement must confirm that it is possible for the Dutch business to transfer its registered office to this new domicile. This transfer then results in the conversion of the Dutch entity into a foreign entity. This converted entity will automatically cease to be a Dutch company and its legal personality will continue to exist in the new domicile, under its new flag. As soon as all formalities of the conversion have been fulfilled, the converted company will continue to exist in the chosen legal form. These formalities consist of amending the articles of association, by a local notary, in order to comply with local laws. Furthermore, the board of managing directors of the entity looking to convert will have to prepare a conversion proposal stating its current name, registered office and number. Unless this requirement is waived, the board of managing directors of Company will also have to prepare an explanatory report explaining and justifying the legal and economic aspects of the conversion and explaining the implications of the conversion for shareholders, creditors and employees. This proposal will then be deposited for two months at the office of the Commercial Register where the entity looking to convert is registered. The conversion proposal and the report will be deposited at the Dutch Company’s business office, during which period creditors may file objections to the envisaged conversion. Prior to conversion the Dutch Company must also announce in a nationally distributed newspaper and in the Staatscourant that the relevant documents have been deposited and when and where these are available for inspection. During the mentioned two-month period any shareholder and/or creditor may file its objections to the conversion proposal with the District Court in Amsterdam. If after said period of two months no one has filed any objections to the conversion proposal and/or the explanatory report, the Court will issue a statement of no-objection, upon receipt of evidence that the filings and announcement as described above have been made. Provided that no one has filed any objections to the conversion, the general meeting of the Dutch corporation will adopt a resolution concerning the conversion and the amendment of the articles of association. The minutes of said meeting must be recorded by a Dutch notary.  Upon completion of the above Dutch pre-conversion steps a Dutch notary will declare in a statement that all Dutch law legal and procedural requirements and formalities necessary to the conversion have been fulfilled. Subsequently, the laws of the inbound jurisdiction will determine when the conversion will become effective (commonly the moment the deed of amendment and conversion is filed in the relevant trade register). Finally, the relevant foreign certificate/evidence of registration, together with a certified copy of the Dutch notarial record must be filed with the Dutch Commercial Register with the request to de-register the newly converted entity.

Services provided by KC Legal:

  • All communications with the foreign notary;
  • Preparation of a conversion proposal;
  • Preparation of the explanatory report explaining and justifying the legal and economic aspects of the conversion;
  • All relevant communications with the Dutch district court;
  • Publications in the national newspaper and Staatscourant;
  • Preparation of a resolution concerning the conversion and the amendment of the articles of association;
  • Preparing and issuing a written statement in which the resignation of the board is confirmed and the emigration date is set;
  • Organising the appointment of new directors;
  • Reviewing the transfer of all records and the closure of all Dutch bank accounts;
  • Preparing of the merger accounts and necessary filings with the trade registry;
  • Preparing and filing the emigration corporate income tax returns.