Netherlands

The Kingdom of the Netherlands is situated in Western Europe, between Belgium and Germany.
It covers an area of 41,543 sq. km and has a population of 16,805,037 people (2013). The Dutch form the largest ethnic community (80.7%), the EU citizens account for about 5%, and the rest of the population is represented by other nationalities, such as Indonesian, Turkish, Surinamese, Moroccan, and Caribbean.
The capital is Amsterdam.
The official language is Dutch.
The currency is euro (EUR).
Climate of the Netherlands is moderate, maritime, with cool summers and mild winters; average maximum temperature (July) is +17°C, average minimum temperature (January) is +1°C. Even if the temperatures drop below zero, it never lasts long.
Time difference with Moscow is -3 hours.
Literacy rate is 99%.
Calling code is +31.

The Dutch United Provinces declared their independence from Spain in 1579; during the 17th century, they became a leading seafaring and commercial power, with settlements and colonies around the world. After a 20-year French occupation, a Kingdom of the Netherlands was formed in 1815. In 1830 Belgium seceded and formed a separate kingdom. The Netherlands remained neutral in World War I, but suffered invasion and occupation by Germany in World War II. A modern, industrialized nation, the Netherlands is also a large exporter of agricultural products. The country was a founding member of NATO and the EEC (now the EU), and participated in the introduction of the euro in 1999. In October 2010, the former Netherlands Antilles was dissolved and the three smallest islands – Bonaire, Sint Eustatius, and Saba – became special municipalities in the Netherlands administrative structure. The larger islands of Sint Maarten and Curacao (as before them Aruba) were granted status aparte and joined the Netherlands as constituent countries forming the Kingdom of the Netherlands.

Administratively, the Netherlands is divided into 12 provinces. There are also three dependent territories in the Caribbean: Aruba, Curacao, and Sint Maarten.
The Netherlands is a constitutional monarchy.
Head of State is the hereditary monarch, but this position is equipped with limited powers.
Executive power is formed by the council of Ministers, the deliberative council of the Dutch cabinet. The cabinet usually consists of 13 to 16 ministers and a number of state secretaries. The head of the government is the Prime Minister.
Legislative power is assigned to bicameral parliament States General, which consists of the 75-seat upper chamber, called First Chamber (members indirectly elected by the country's 12 provincial councils to serve four-year terms) and the 150-seat lower chamber, called Second Chamber (members elected by popular vote to serve at most four-year terms).
Judiciary power comprises: 19 district courts (the courts of first instance), 5 courts of appeal (in Amsterdam, Arnhem and other major cities) and the Supreme Court. These courts deal with, in general, civil law, criminal law and tax law. Justices are appointed by the monarch from a list provided by the Second Chamber of the States General; justices appointed for life or until mandatory retirement at age 70.

The Dutch economy is the sixth-largest economy in the euro-zone and is noted for its stable industrial relations, moderate unemployment and inflation, and a sizable trade surplus. A considerable contribution to the country’s wealth is provided by financial and transportation services, Amsterdam being one of the world’s major financial centers, and Rotterdam having the world’s busiest ports. Industrial activity is predominantly in food processing, chemicals, petroleum refining, and electrical machinery. A highly mechanized agricultural sector employs only 2% of the labor force but provides large surpluses for the food-processing industry and for exports.

The legal system of the Netherlands is based on civil law system incorporating French penal theory.
Constitution does not permit judicial review of acts of the States General.
The Netherlands accept compulsory International Court of Justice jurisdiction with reservations.

The principal forms of business organization in the Netherlands are:

• Private limited liability company (Besloten Vennootschap, B.V.);
• Public limited liability company (Naamloze Vennootschap, N.V.);
• Cooperative (Coöperatief met wettelijke aansprakelijkheid/beperkte aansprakelijkheid/uitgesloten aansprakelijkheid, W.A./B.A./U.A.);
• Limited partnership (Commanditaire Vennootschap, C.V.);
• Sole proprietorship.

The most common structure is the private limited liability company (B.V.).

A company name must satisfy the requirements of the Dutch Company Name Act (Handelsnaamwet) which are as follows:

• The suffix to denote limited liability in the company name is ‘B.V.’.
• It may be expressed in Dutch or any language using Latin alphabet. Names in Cyrillic alphabet are not allowed.
• The name must not be confusing or misleading, which means one cannot choose a name that is identical or similar to an existing company’s name. In other words, a name should be unique in the sector and the region in which the company will be operating. So the proposed name must first be checked at the trade register of the Chamber of Commerce of the district where the company is to be situated. It is also possible to pay for the Chamber of Commerce to conduct a nationwide business name search.
• The name may not conflict with existing trademarks. The Chamber of Commerce does not investigate whether this is the case when a business is registered, the Benelux Trademark Agency in the Hague is responsible for protecting trademarks.
• The following names, their derivatives or foreign language equivalents require consent or a license: Bank, Building Society, Savings, Loans, Insurance, Assurance, Reinsurance, Fund Management, Investment Fund, Trust, Trustees, Chamber of Commerce, Co-operation, Council, Municipal, as well as any other names that may suggest association with the banking or insurance business.

The following steps are required to incorporate a BV in the Netherlands:

1. Check the company name for appropriateness and validity: As of July 2011, the Chamber of Commerce no longer carries out trade names searches. However, parties themselves can carry out a check on trade names online on the website of the Chamber of Commerce, free of charge.
2. Draft and sign the company’s deed of incorporation that is executed by a civil law notary: The deed of incorporation should contain all of the following: articles of association; name of the company; statutory seat (registered office); main objects of the company; details on the authorised share capital of the shares issued at incorporation; representation of the company by the directors (e.g jointly or individually); details on the incorporator(s)/shareholder(s); appointment of the first managing director(s); and first financial period.
3. Register the company at the local chamber of commerce and obtain a registration number: The registration at the Chamber of Commerce can be done online or in person. If it is done online, it takes several hours to receive the registration number and if the documents are filed in person, it takes a week. Membership with the local chamber of commerce is mandatory.
4. Register with the local tax authorities and at the same office register for social security authorities: The registration form can be filed in a day but it will take 4–6 weeks for the tax office provides the required tax numbers. For income tax, a separate registration form must be filed and this can also take 4 weeks.

Usually a Dutch BV is incorporated in 2 – 6 weeks. However, in theory it is possible to have a BV fully incorporated within 5 working days depending on the cooperative behavior of the Civil Notary and processing time with the Chamber of Commerce at that particular moment.
Shelf companies are allowed. Abolishment of the requirement of a declaration of no objection with the Ministry of Justice, a minimum share capital of 18,000 euros, as well as the requirement of a bank or auditor’s statement have increased the attractiveness to choose for a newly incorporated BV instead of purchasing a shelf company in some extend.

Dutch banks have strict client acceptance policies and need e.g. to determine the ultimate beneficiary owner (UBO). Be aware that additional information regarding group structures, UBO, policy makers etc. will almost certainly be requested when UBO(s), directors, shareholders are non (EU) residents. Especially in case there is a link with off shore jurisdictions. Connections with Ultra High Risk Countries - Cuba, Iran, Myanmar, North Korea, Sudan and Syria – lead to decline of the application. Non-resident corporate account are still offered by a few banks, however not actively commercially promoted and easily granted.

There are a number of restrictions on the activities of a private company. It cannot undertake the business of banking, insurance, financial services, consumer credit related services and employment agencies unless a special permission is granted.

Dutch companies must maintain a registered office within the Netherlands and keep there a shareholders’ register, minutes and resolutions, share transfer documents, administrative and book-keeping records.

There are no statutory requirements for a Dutch company to have a seal.

The redomiciliation of companies to or from the Netherlands is not permitted.

A Dutch BV is required to have a minimum of one director who can be a natural person or a body corporate. Director’s details appear on the public file. There is no legal requirement for the directors to be Dutch residents. However, in order for the company to qualify as a tax resident and consequently take advantage of the double tax treaty network, it is recommended that the company be managed and controlled from the Netherlands. Thus the majority of its directors should be Dutch residents and all board meetings of the company should take place in the Netherlands. Furthermore it is recommendable to have at least one Dutch director regarding practical day-to-day issues such as renewal or change of bank contracts, opening additional bank accounts, close and modify contracts relating to telephone and internet subscriptions, lease contracts, post office boxes, changing data at the Chamber of Commerce.

Dutch companies are not required to appoint a company secretary.

A Dutch BV may have one or more shareholders, individuals or corporations of any nationality or residence. Shareholders’ details are disclosed to the local agent and will not appear on the public file unless the company has only one shareholder. However, it should be noted that the founders (initial shareholders) will appear on public record irrespective of their number. General meetings are to be held annually at the place provided for by the articles of association or, otherwise, in the municipality where the company has its registered office. The location referred to in the articles may be within or outside the Netherlands (the latter option arouse with the coming into effect of BV simplification and flexibilisation law). In a general meeting held elsewhere than due, decisions can be taken only if the entire issued capital is represented.

The identity of the beneficial owner of a Dutch company is treated as strictly confidential and must be disclosed as part of the obligatory due diligence to the local agent and local bank where the company opens an account for payment of share capital, as well as to the auditor (if one is appointed), and can only be disclosed by them in the cases stipulated by law and following statutory procedure.

The simplification and flexibilisation BV-law which came into effect on 1 October 2012 brought about a number of significant changes in the BV’s share capital. Until then the minimum authorized share capital of a Dutch BV was EUR 18,000 and had to be paid up by the time of incorporation. This minimum capital requirement has been abolished, so a BV can have the share capital as small as EUR 1.
Another change is that the share capital can now be denominated in a currency other than EUR.
Abolished was also the mandatory inclusion in the BV’s articles of association of a transfer restriction clause for the transfer of shares, so shares can now be freely transferable/freely traded.
A BV can only issue registered shares; it is not permitted to have bearer shares or shares with no par value. The par value is usually EUR 1.

Dutch companies are renewed annually and the renewal normally includes: payment of fees for nominee directors and shareholders (if any), registered office and fee payable to the Chamber of Commerce (which depends on the amount of the capital and number of employees).

A Dutch company can be dissolved:

• voluntarily by special resolution of its general meeting passed to this effect;
• where an event occurs which, according to the company’s articles of incorporation, leads to its dissolution;
• where it has been declared bankrupt;
• by decision of the Chamber of Commerce for a failure to fulfill certain administrative obligations;
• by court order in the cases provided for by law.

The resolution of the general meeting to dissolve the company must be filed with the trade register of the Chamber of Commerce together with the particulars of liquidator(s). If no liquidator is appointed, the management board acts as committee of liquidators. The words 'in liquidation' must be added to the name of the company in all publications, letters, documents and announcements released from now on.
After the company is put into liquidation it continues to exist insofar this is necessary for the liquidation of its assets and discharge of its obligations. The liquidator prepares liquidation accounts and, if there is more than one shareholder, a plan of distribution. The plan of distribution sets out how the company’s assets and liabilities are to be divided between the parties entitled thereto. The liquidation accounts and the plan of distribution must be filed with the trade register and be deposited at the company’s office for public inspection.
The liquidator must publish in the Dutch Gazette and in a national daily newspaper a notice of dissolution specifying where the liquidation accounts and the plan of distribution have been deposited for public inspection. Within two months of the date of such publication, these documents can be inspected and an objection against them can be lodged by creditors or other interested parties. On expiry of this two-month period and in the absence of objections, the distribution of the liquidation proceeds can be effected. This step completes the liquidation procedure and the existence of the company, but the company’s books and records must be retained for a further period of seven years. The completion of the liquidation must be reported to the trade register of the Chamber of Commerce, together with the name and address of the custodian of the corporate books and records. The data and information recorded in the trade register with regard to the company at the time when it ceases to exist, is kept there for ten years afterwards.

Reopening of Dissolution
If upon completion of the liquidation there appears to remain an asset to be liquidated, or a creditor or beneficiary that has not been satisfied, then the liquidation may be ‘reopened’ by a decision of the Court. In such case the company is ‘revived’, but solely for the purpose of re-liquidating the balance; to the extent that the beneficiaries have received too much, the liquidator is authorized to reclaim the balance already distributed.

Fast-track dissolution
If the company has no assets or outstanding obligations at the time of its dissolution, it will cease to exist as of the date of filing of the resolution with the trade register. In such case there will be no actual winding up of the affairs, and consequently no liquidators have to be appointed. The liquidation of the company will be filed with the trade register by the management board. The company's books and records will still need to be retained by the custodian for a period of seven years.

A company is dissolved by a decision of the Chamber of Commerce if the Chamber of Commerce has evidence that at least two of the following circumstances are applicable. The company for at least one year:

• after the due date has not paid the sum due for its registration in the trade register;
• no directors of the company are registered in the trade register for a period of at least one year, nor a report for such a registration has been made; or all the registered directors are deceased or appear to be unreachable for at least one year at the addresses mentioned in the trade register and at the addresses mentioned in the municipal personal record database or, no addresses are mentioned in that database for at least one year;
• has failed to comply with its obligation to disclose its annual accounting records or the balance sheet and notes;
• has not responded properly to a letter of formal notice to file a tax return for corporation tax.

If the Chamber of Commerce becomes aware that a company is eligible for dissolution, it will notify the company and its directors of the intention to dissolve the company and grounds for it. The Chamber of Commerce records this notification in the trade register. If there are no directors to give notice to or if there are no addresses for the directors to send notice to, the Chamber of Commerce ensures that the notification is published in the Dutch Gazette. If the costs of this publication cannot be recovered from the assets of the company, they are borne by the Ministry of Justice.
Eight weeks after the date of the notification the Chamber of Commerce by its decision dissolves the company unless the Chamber prior to this moment has received evidence that the failure mentioned in the notification is not or no longer applicable.
The decision of the Chamber of Commerce will be announced to the company and its registered directors. The Chamber of Commerce ensures that the dissolution is published in the Dutch Gazette. If it is not possible to appoint one or more liquidators, the Chamber of Commerce will act as liquidator of the assets. Upon the request of the Chamber of Commerce, the District Court shall appoint one or more other liquidators.

The District Court dissolves a company if:

• defects (imperfections) are attached to its formation;
• its articles of incorporation do not meet the statutory requirements;
• it does not fall under the statutory definition of its legal type.

The District Court does not dissolve the company if the court has granted the company for a specific period of time the opportunity to comply with the necessary statutory requirements and the company has fulfilled these requirements within that period. The District Court may dissolve a company if it violates the legal prohibitions set out for this type of company or if it acts to a serious degree in breach of its articles of incorporation. The dissolution is ordered by the District Court upon a request to this end of an interested party or of the Public Prosecution Service.

Dutch tax residents pay income tax on their worldwide income, non-residents on income from Dutch sources.
There are three categories of income (boxes) for tax purposes:
1. Employment income, deemed income from housing, periodic payments, and business income. Such income is taxed at progressive rates:

• Income up to EUR 35,129 – 9.45% (the national insurance premium is also charged on this amount at a rate of 27.65%, i.e. the total fiscal payment rate is 37.1%)
• Income from EUR 35,130 to 68,507 – 37.1%
• Income over EUR 68,507 – 49.5%.
• 2. Income from substantial participation in companies. Substantial participation means holding, individually or jointly with relatives, at least 5% of company shares. Profits from the sale of such investments and dividends on them are taxed at 26.9%.
• 3. Income from savings and investment. There is no tax as such on capital gains or current investment income (for example, dividends, interest, and royalties – unless it is business income). Instead, the taxpayer's net assets (assets less liabilities) are assessed as at 1 January. This value is used to calculate an annual fixed income taxed at the rate of 31%. There are various deductions and exemptions. The return on net assets is calculated using a special scale:
• 1.9% for assets with a total value of EUR 50,000 to 100,000
• 4.5% for assets with a total value of EUR 100,000 to 1,000,000
• 5.69% for assets with a total value over EUR 1,000,000

Dutch companies pay tax on their worldwide income. The standard income tax rate is 25%. For companies with profits up to EUR 245,000, the tax rate is 15%.

Capital gains and dividends are included in the general tax base. However, such income is exempt from tax under the substantial participation exemption. This exemption applies if participation is at least 5% and a number of other conditions are met. Such conditions usually include the non-portfolio nature of the investment.

The exemption is also available if the subsidiary is taxed at a sufficient tax rate (at least 10%), and if less than 50% of the subsidiary’s assets are passive assets.

Dividends must not be deductible for corporate income tax by the distributing entity.

A foreign company is considered a controlled foreign company (CFC) if:

(i) a participation held in it, directly or indirectly, solely or jointly with related parties, is more than 50%,

(ii) more than 30% of its income is passive income,

(iii) the foreign company is from a low-tax jurisdiction (corporate income tax rate is less than 9%) or a jurisdiction listed as non-cooperative by the national government or the EU.

The passive income of a CFC is taxed in the hands of the Dutch controlling person.

CFC rules may disapply if the foreign company is engaged in genuine business activities.

Withholding tax is levied on dividends at the rate of 15%. The tax can be reduced under double tax treaties and EU directives.

Withholding tax is not levied on interest or royalties, except for payments to related parties in certain low-tax jurisdictions. In this case, the tax may be levied at the rate of 25%.

The tax may be withheld on certain other income payments.

The standard VAT rate is 21%.

Some goods and services are subject to the reduced rate of 9%.

Employees pay a national insurance premium on remuneration up to EUR 35,129 at the rate of 27.65% (payable together with income tax).

Employers pay an employee insurance premium for income up to EUR 58,311 at rates depending on the industry. On average, the contribution is EUR 6,757 per year for a permanent employee and EUR 9,673 for temporary employees.

Employees pay compulsory health insurance contributions of about EUR 1,498, employers – at 7% on remuneration up to EUR 58,311.

There are some other premiums as well.

The tax is levied on the market value of the property at the rate of 8%.

A reduced rate of 2% applies when purchasing a property for living in it; in some cases, an exemption applies.

The tax may also be levied on the transfer of shares in a company with a significant share of real estate assets.

An annual tax is levied on immovable property owners at the municipal level.

The rates depend on the municipality; the tax base is the market value of the property.

The tax is levied on the market value of the gift or inheritance.

There are tax-exempt thresholds. Their size, as well as the tax rate (from 10% to 40%) depends on the degree of relationship between the parties.

The Netherlands has entered a whole range of double tax and tax information exchange mechanisms:

101 DTCs: Albania, Algeria, Argentina, Armenia, Aruba, Australia, Austria, Azerbaijan, Bahrain, Bangladesh, Barbados, Belarus, Belgium, Bosnia and Herzegovina, Brazil, Bulgaria, Canada, China, Croatia, Curacao, Czech Republic, Denmark, Egypt, Estonia, Ethiopia, Finland, France, Georgia, Germany, Ghana, Greece, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Jordan, Kazakhstan, Korea, Kosovo, Kuwait, Kyrgyzstan, Latvia, Liechtenstein, Lithuania, Luxembourg, Macedonia, Malawi, Malaysia, Malta, Mexico, Moldova, Montenegro, Morocco, Netherlands Antilles, New Zealand, Nigeria, Norway, Oman, Pakistan, Panama, Philippines, Poland, Portugal, Qatar, Romania, Russia, Saudi Arabia, Serbia, Singapore, Sint Maarten, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Suriname, Sweden, Switzerland, Tajikistan, Taiwan, Thailand, Tunisia, Turkey, Turkmenistan, Uganda, Ukraine, UAE, United Kingdom, United States of America, Uruguay, Uzbekistan, Venezuela, Vietnam, Yugoslavia, Zambia, Zimbabwe.

26 TIEAs: Andorra, Anguilla, Antigua and Barbuda, The Bahamas, Belize, Bermuda, British Virgin Islands, Cayman Islands, Cook Islands, Costa Rica, Dominica, Gibraltar, Grenada, Guernsey, Isle of Man, Jersey, Liberia, Liechtenstein, Marshall Islands, Monaco, Montserrat, Samoa, St Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Turks and Caicos

There are no foreign exchange controls in the Netherlands.

All Dutch companies are required to prepare annual accounts and file them with the Dutch Chamber of Commerce. The accounts need to be prepared within 5 months after financial year-end, be approved by the general meeting within 2 months after the preparation and be filed within eight days of such approval. In any event the annual accounts of a financial year should be filed within 13 months after the financial year-end. The general meeting of shareholders may extend the period for preparing the annual accounts for a maximum period of six months.
The annual accounts comprise:

• management board’s report;
• financial statements, consisting of: • balance sheet
• profit and loss account
• notes
• other information. 


Consolidated financial statements, when required, are part of the annual accounts.
Specific requirements to the annual accounts depend on the category of a company. There are three such categories: small, medium-sized and large:

Category	Small	Medium-sized	Large
Total assets, million EUR	< 4.4	< 17.5	> 17.5
Net turnover, million EUR	< 8.8	< 35	> 35
Average number of employees	< 50	< 250	>250

For example, small companies are not required to prepare (nor publish) a management board report. A small company is a company that meets at least two of the three above-mentioned requirements for two consecutive years. These requirements should be determined on a consolidated basis. This implies that the assets, turnover and employees of companies in which the Dutch company has (in)directly the majority of the control should be taken into account. This is however not the case when the Dutch company is exempt from preparing consolidated accounts on the basis of the company being an intermediate (holding) company.
When the company is newly incorporated, the two consecutive year rule cannot apply. In that case, whether or not the company is considered to be ‘small’ is determined on the basis of the financial accounts of the first financial year. The outcome applies to the first two financial years.
Besides, a Dutch company that is part of a group may under certain circumstances be exempt from the filing of annual accounts in the Netherlands. For a company to be exempt in the Netherlands, amongst others, all the following conditions must be met:

• the parent company of the group declares each year to be personally liable for the debts of the company;
• the financial details of the Dutch company are included in the consolidated financial accounts of the parent company.

When a company is exempt from the filing of accounts, annual accounts are still required to be prepared and approved.

The accounts also need to be audited by an outside registered auditor. However, ‘small’ companies are exempt from audit.

Generally speaking, Annual Return is a short review on the current state of the company, which is prepared annually. As a rule it includes the following information:

• Incorporation information (registration date, registered address);
• Information about directors and their resignation;
• Information about secretaries and their resignation;
• Information about registered capital, nominal value of shares and amount of issued shares;
• Information about shareholders and share transfer.

In the Netherlands companies are obliged to prepare and file Annual Return which provides details of those who have held shares throughout the year and the current directors must be filed each year. If you do not deliver the company's annual return, the Registrar might assume that the company is no longer carrying on business or in operation and take steps to strike it from the register.

The tax year generally coincides with the calendar year. However, a company can choose a financial year other than a calendar year, and the tax year will be linked to the financial year.
The tax return is filed within 5 months of the company’s financial year-end.
The tax is payable within 2 months of the date of the tax assessment.
During the tax year, the tax office issues two preliminary tax assessments and at the end of the year – the final tax assessment.

On 1 January 2014 the new Decree (2014) amending International Assistance Levy Tax Act came into effect that entitles Dutch tax authorities to spontaneously exchange information with its tax treaty partners on companies that benefit from Dutch tax treaties but lack sufficient (economic) ‘substance’. The companies targeted by this new legislation are group financial service companies that do not maintain sufficient substance in the Netherlands, i.e. companies that meet the three following criteria collectively:

1. activities of the Dutch company in any given year comprise at least 70% of group financing, licensing (royalty) and/or leasing activities;
2. Dutch company and the other companies involved in the financial transaction(s) are part of the same group;
3. Dutch company does not meet the new minimum substance requirements which are as follows:

• at least half of the directors are Dutch residents;
• the Dutch resident directors have the necessary professional skills to properly carry out their duties for the Dutch company;
• the company has qualified personnel to carry out the implementation and administration of the transactions (external staff could be hired for this purpose);
• the management decisions are taken in the Netherlands;
• the company holds its principal bank account(s) in the Netherlands (a non-Dutch bank accounts operated by the Dutch management qualify as well);
• the company keeps its books in the Netherlands;
• the company is domiciled in the Netherlands and is, to the best of its knowledge, not considered a tax resident in another state;
• the company has an adequate equity for its functions and risks;
• the company runs a genuine business risk with respect to its financing, licensing or leasing activities.

Most of aforementioned conditions were already laid down in the Dutch International Assistance Levy Tax Decree 2004. Amendments that came into effect as from the 1st of January 2014 may mostly be considered as further elaboration and refinement. For example, leasing activities de facto comparable to group financing and licensing (royalty) activities are now formally aligned with group financing and licensing (royalty) activities. Furthermore, whereas previously the decree regulated the requirements based on which qualifying group financial service companies would comply with the substance criteria used by Tax Authorities, these companies are now obliged to – actively- provide relevant information to Tax Authorities. It is obligatory to indicate in Corporate Income Tax returns whether there’s sufficient substance or not. Non compliance with this obligation leads to an administrative fine of maximum EUR19.500,-
Note that these substance requirements apply only to companies that qualify as group financial service companies and benefit from Dutch Tax treaties. A contrary, for other companies no further explications need to be given to determine whether the company has sufficient substance in the Netherlands.