Legal forms of companies in the Netherlands

General partnership or Vennootschap Onder Firma (VOF). A general partnership is a business structure with one or more partners. It is advisable to put down in writing what all business partners have agreed upon. Partners are classed as self-employed entrepreneurs, and are liable for business (financial) obligations individually. Liability may also extend to spouses although a marriage contract can protect assets. Each partner will pay his or her own income tax on his or her profit share.

Limited partnership or Commanditaire Vennootschap (CV). This is a business structure with one or more general partners and one or more limited partners. Limited partners tend to be financial investors (and do not need to register with the Chamber of Commerce) while general partners are active in the day-to-day operations and decisions of the business. The contract should arrange the distribution of profit between general and limited partners. General partners can be held fully liable if the partnership fails to meet its obligations. Bankruptcy of the limited partnership will automatically lead to the general partners’ bankruptcy (not applicable to limited partners). A limited partner can only be held liable for the maximum sum contributed to the partnership.

Professional partnership or maatschap. The partnership referred to as maatschap under Dutch law differs from the general partnership and the limited partnership in that it is a form of cooperation established by professionals rather than a cooperation established for the purpose of doing business. Partners should write down their agreements with the other professionals in a partnership contract. Each partner pays income tax on his or her profit share.

Private company with limited liability or Besloten Vennootschap (BV). A BV is classed as a legal entity, thereby limiting the risks to the owner(s), and must be registered with the Chamber of Commerce. The BV itself is seen as the entrepreneur, whereas the person who is appointed director merely acts on behalf of the BV and cannot be held personally liable for their acts. As of 2012, there is no minimum amount of start-up capital required to register a BV, but start-up costs usually range between €1,500 and €2,500 (excluding VAT) – naturally, set-up costs will vary depending on the structure and size of the business, so are not limited to €2,500. 

One-man business, also known as a sole trader or eenmanszaak. In a one-man business, there is one fully independent founder and owner, although the business may employ personnel. Business obligations apply to sole traders, and may also apply to spouses. No distinction is made between private and business property. Thus, business creditors can seek recovery from the owner’s private property and private creditors from the business property. A self-employed entrepreneur also covers the term freelancer or ZZP-er. Although the legal entity is the same as that of the one-man business, the term relates to those who are self-employed without staff. Consult our Guide to Going Freelance in Amsterdam.

Downloads and more information

For more information on starting a business, see our step-by-step guide to setting up a company, and download the pdf with information on setting up your business in the Netherlands.