Incorporation Proceedings

What different types of Dutch companies can you choose when setting up a business in the Netherlands?

By 9 January, 2018December 19th, 2022No Comments

A foreign individual or company may set up a business in the Netherlands, under Dutch law, through incorporated (entities with legal personality) or/and unincorporated (entities without legal personality) entities or branches. To doing business in the Netherlands, all entrepreneurs have to register their business with the Trade Register (‘Handelsregister’) at the Chamber of Commerce (‘Kamer van Koophandel’).

Incorporated entities

A distinction can be made between the private limited liability company (besloten vennootschap met beperkte aansprakelijkheid – ‘BV’) and the public limited liability company (naamloze vennootschap – ‘NV’). Both entities possess legal personality and a capital dividend into shares.  The Dutch foundation (‘stichting’) and the cooperative (‘coöperatie’) are other commonly used legal entities in the Netherlands. The Dutch cooperative was historically used mainly in the agricultural sector and by certain banks and insurance companies. In the last decade, it has been reinvented as a holding company in international structures due to its flexibility from a Dutch legal and tax perspective. The foundation is used within the non-profit, private wealth and health care sector.

Unincorporated entities

Unincorporated entities do not have legal personality. Common business forms are sole proprietorship (‘eenmanszaak’), general partnership (vennootschap onder firma – ‘VOF’), civil partnership (‘maatschap’) and a Dutch limited partnership (commanditaire vennootschap – ‘CV’). A CV has one or more general and limited partners. Partners in a VOF or maatschap will be liable for the obligations of this entity. The general partners of a CV are liable for the obligations of this entity whereas the limited partners are not. Unincorporated entities are in principle treated as transparent for Dutch tax purposes.


A branch is an establishment in the Netherlands which is part of and governed by a foreign legal entity. The foreign legal entity that establishes a branch in the Netherlands (‘parent business’) therefore always bears ultimate legal liability for the branch. The branch may qualify as a ‘permanent establishment’, for Dutch tax purposes depending on the nature and scope of the activities. The results of the branch will then be taxable in the Netherlands.

Don’t know which to choose?