Curaçao: Types of Company

NB: The Netherlands Antilles as such ceased to exist in October 2010. This page deals with Curacao, the largest component of the jurisdiction, which has taken its place in many respects.

On December 29th, 1999, the Parliament of the Netherlands Antilles passed new tax legislation known as The New Fiscal Framework intended to improve the jurisdiction's image as an Offshore Financial Centre and to revitalise its financial services industry. Alongside the tax legislation, a new corporate form was introduced to allow offshore operations on a tax-exempt basis: this is the NABV (Netherlands Antilles Besloten Vennootschap), and it was expected to supplant the offshore NV for many purposes (see Offshore Legal and Tax Regimes and Domestic Corporate Taxation).

The New Fiscal Framework went into effect from 1st January 2002.

In 2004 a new corporate law was introduced as 'Book 2' of the Civil Code which in broad terms simplified and liberalised some aspects of the formation and operation of most of the corporate forms dealt with below, as well as introducing new rules covering corporate governance and dealing with directors' liability.

After the dissolution of the Netherlands Antilles in October, 2010, Curaçao and Sint Maarten adopted all Netherlands Antilles legislation then in place with the instruction that all references to the Netherlands Antilles should be replaced with the word 'Curaçao' until such time as new legislation is drawn up by the newly independent country.

Curaçao Limited Liability Company (NV)

This is the form (NV = Naamloze Vennootschap) that was historically taken by almost all limited companies in the Netherlands Antilles, whether for domestic trading or for offshore purposes. The legislation governing corporate operations is Articles 33 to 155 of the Netherlands Antilles Commercial Code, and is quite precise and prescriptive, as is usual in 'Civil Law' jurisdictions. These are some of the main characteristics and requirements attaching to NV companies:

• A minimum of one shareholder is required, who may be an individual or a corporate entity. A General Meeting of the shareholders must be held within nine months of the end of a fiscal period to approve the annual statement, to discharge the management from its responsibility for the period concerned, to vote on dividends, etc. Such meetings must be held in Curaçao, but shareholders can be represented by proxies.
• There must be at least one director; more importantly, there must be at least one managing director resident in the jurisdiction. There can be multiple managing directors, and they have the statutory responsibility for management of the company, which is clearly defined, as usual in Civil Code jurisdictions. Managing directors can be individuals or corporate entities, and need not be resident (except one of them). The managing directors exercise wide powers, including those of the anglo-saxon company secretary.
• The authorised capital of the NV must be at least ANG50,000, of which 20% must be paid-up on incorporation and must remain so (this can be a mixture of fully and partly paid-up shares). Shares can be registered or bearer; but the latter must always be fully paid-up.
• A registered office must always be maintained at the address of a licensed management company, or firm of lawyers or accountants in the jurisdiction. There is no requirement to audit or file annual statements. An small annual fee is payable to the Chamber of Commerce.
• The incorporation process is somewhat cumbersome, involving an investigation of prospective shareholders by the Ministry of Justice (who issue a statement of 'No Objection' after several weeks), permission for the chosen name from the Chamber of Commerce (some restrictions), and other administrative procedures inluding the submission of the Statutes in Dutch (an English translation is often attached). A quicker process is sometimes available.
• A Netherlands Antilles NV cannot solicit funds from the public, sell its own shares publicly, or engage in banking, insurance, fund management etc without appropriate licenses and permissions from the Central Bank. A business license (not always given automatically) and a managing director's license need to be obtained annually from the Bureau for Social and Economic Planning, before business can actually commence.

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Curaçao Besloten Vennootschap (NABV)

The NABV, which was introduced alongside the New Fiscal Framework, has the following characteristics:

• Unlike the NV, no ministerial Declaration of No Objection is required - incorporation is quick and relatively informal;
• There are no minimum capital requirements;
• The Deed of Incorporation can be in any language, although a Dutch or English translation must be attached;
• Shares may or may not have a par value, voting rights or participation rights;
• Shares must be registered; bearer shares are not permitted; the BV must keep a share register;
• The management arrangements are more similar to common law models than to the usual civil code structure;
• The BV can be converted into an NV and vice versa, or the two may merge.

The NABV can be exempt from profits tax and withholding tax when it conforms to the following conditions:

• An application for a 0% tax rate needs to be filed with the tax inspector;
• The Board of Directors must consist of resident individuals or resident certified trust companies (the Ministry of Finance has yet to publish the regulations governing certification of trust companies);
• The purposes and activities of the BV should consist entirely or nearly so of lending and investment, or financial services, or other activities connected with these; but
• The BV should not be a bank or other body subject to the supervision of the Bank of Curaçao and Sint Maarten.

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Curaçao General Partnership

Partnerships are recognised under the Curaçao Commercial Code. In the General Partnership (vennootschap onder firma) each partner is liable for all the debts of the partnership, as in common law partnerships. There are no filing requirements, and no auditing requirements. Partnerships are fiscally transparent.

Details of partnerships and of the partners must be entered in the Commercial Register at the Chamber of Commerce.

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Curaçao Limited Partnership

The limited partnership (commanditaire vennootschap) is similar to the general partnership except that it has one or more general partners with unlimited liability, who manage the partnership, and one or more limited partners each of whose liability is limited to the amount of his contribution. The identity of the limited partners does not have to be disclosed or entered in the Commercial Register.

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Curaçao Stichting (Foundation)

The stichting (or foundation) is the equivalent in this civil law jurisdiction of the trust in a common law jurisdiction, although unlike the trust, the stichting has legal personality. It was originally created for welfare purposes, but is now often used to act as a trustee or manager of assets for a third party, or to control shares in companies. Shareholders receive certificates of participation in return for shares transferred to the stichting, and can be paid dividends. The certificates can be either registered or bearer and are freely transferable.

A stichting is constituted under the Civil Code; the main characteristics of the stichting are as follows:

• A stichting must be entered in the commercial register of the Chamber of Commerce.
• There is no minimum capital requirement (but in practice it is usual to have US$100 as capital).
• A stichting does not have members or shareholders
• A stichting is managed by one or more directors who do not share in the profits or assets and who can be individuals or corporations; at least one director must be resident in the Netherlands Antilles.
• Books of accounts must be kept but do not require auditing.
• The identity of beneficiaries or holders of certificates of participation need not be disclosed.
• A stichting may transfer its seat into and out of the Netherlands Antilles provided that the other jurisdiction concerned has suitable legislation (in practice this means that the other jurisdiction is a civil code jurisdiction, which is somewhat limiting since the bulk of offshore jurisdictions apply common law).

Under the National Ordinance on Profit Tax 1940, the profits of a stichting created for other than charitable purposes are treated in the same way as those of an NV, see Offshore Legal and Tax Regimes.

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