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Establish a Branch in the Netherlands

Establish a Branch in the Netherlands

Foreign companies that want to establish their presence in the Netherlands with low costs can establish a branch. This business form is not considered a legal entity but an extension of the foreign company so all the responsibilities for its actions are taken by the parent company abroad. 

 Quick Facts  
  Applicable legislation

Local and of the parent company’s home country

Best used for

Highly regulated activities, such as banking, insurance, financial operations

Minimum share capital

 No
Time frame for the incorporation (approx.) 

Approx. 4 weeks

Management 

Local 

Legal representative required

Yes

Local bank account 

Yes

Independence from the parent company Fully dependent on the parent company
Liability of the parent company Fully liable for the branch office’ obligations
Corporate tax rate   25% on worldwide income. Tax exemptions profit remittance apply.
Possibility of hiring local staff  Yes
Documents to be filed by the parent company 

– information about the parent entity;

– personal information of the appointed Dutch officers;

– proof of legal address, etc.

 Annual accounts filing requirements

Dutch branch offices must file annual accounts of the parent company with the Trade Register. 

 Travel requirements for incorporating a branch (YES/NO)

No, there is no need to travel to the Netherlands until the last stages of the company registration process. 

 Double tax treaty access (YES/NO)  Yes, the Netherlands has signed approximately 100 double tax treaties.
 Special licenses required (YES/NO)

 Yes, depending on the activities of the Dutch branch.

 Dutch legal address required (YES/NO)

Yes, a local legal address is mandatory for a branch in the Netherlands. 

 Special trading name requirements (YES/NO)

 Yes, the branch office must bear the same name as the parent company.

 Activities permitted

 The same activities as the parent company.

 Employee transfer possibility (YES/NO)

Yes, the foreign company can transfer employees to its branch. 

 Advantages of a Dutch branch office

– easy to register;

– simplified incorporation requirements;

– access to double tax treaties, etc. 

 Incorporation services availability (YES/NO)

 Yes, you can rely on our local agents for setting up a company in the Netherlands, including a branch office.

The actions of the branch in the Netherlands are assured by a representative that will act on behalf of the company based on a power of attorney. The Dutch branch will need to perform the same business activities as the parent company and have the same name. The laws governing its actions will be both Dutch laws but also the laws from the foreign company’s country of residence.

The branch is a preferred business form because it provides a permanent establishment with lower costs than other types of companies in the Netherlands and has no requirements for a minimum capital.

Differences between a branch and a local company in the Netherlands

The most important difference between a Dutch branch and other form of business, like a subsidiary in the Netherlands, is that the branch is fully dependable on the parent company abroad. This means that the foreign company will be liable for the debts and obligations incurred by the branch in the Netherlands.

Although the company registration procedure is easier than for other types of companies, like the Dutch BV for example, the branch will need to observe the laws for employment and taxation. For example the law stipulates that the employees of a branch must be registered for the social insurance. If not, the representative of the branch may be personally liable for not paying the contributions. A branch opened in Netherlands is usually subject to the same financial obligations as the local companies. 

A number of double tax treaties signed by the Netherlands and other countries can ease the tax burden on branches, provided that the branch qualifies for the reduced withholding tax rate for dividends, royalties or interest.

Branch registration in the Netherlands in 2023

Before starting the commercial activities, the branch must register at the local Chamber of Commerce in the Commercial Registry with the appropriate documents and information. The documents must be notarized in the country of origin and followed by an authorized Dutch translation.

The requested documents for incorporation may differ from case to case but in essence the following information is necessary:

  • a proof of existence of the foreign company (an excerpt from the local trade register with the date of registration and details of the company),
  • the certificate of registration of the parent company issued by the Trade Register in its home country,
  • the name and the registered office in the foreign country of the parent company,
  • the name and details regarding the board of directors and secretary (or any form of management),
  • the minutes of the meeting when the decision to establish the branch was made,
  • the branch name which must be the same as the parent company’s and its address in the Netherlands,
  • the name of the appointed representative and the power of attorney which grants him or her authority to represent the foreign company,
  • the powers of this representative and the activities which will be performed by the branch.

After the branch is registered, the Chamber of Commerce will release the certificate of registration with the unique number of recording. After this step, the branch must register at the tax authorities and at the social security funds. After all of these steps are complete the branch may begin its business activities in the country.

You can read about the steps for opening a branch in the Netherlands in the scheme below:

how-to-open-a-branch-in-the-netherlands-in-5-steps-compressor.png

The steps for opening a branch in Netherlands are similar to those in other countries, however it is recommended to ask for specialized assistance as some jurisdictions may have other special requirements. For example, if you are interested in setting up a branch in Hong Kong, we can put you in touch with a team of specialists in company formation matters in Hong Kong.

The advantages of a branch in the Netherlands

Because the registration procedure is easier and less time consuming than for companies incorporated directly in the country, foreign corporations will sometimes choose to establish a branch. The lower costs for incorporation are also an advantage and so are the more relaxed reporting and accounting obligations for branches in 2023.

Opening a business in the Netherlands implies additional steps after incorporation. Depending on the industry in which you work, you might also require extra permits. Additionally, you ought to have obtained the required approvals from the appropriate legal authorities in relation to public health and safety, such as the food, environment, and hospital.

If you are interested in starting a business in another country, such as opening a company in Austria, our agents who can put you in touch with our local partners. 

Why choose to create a branch office in the Netherlands in 2023

The Dutch branch is one of the most suitable options for those who want to expand their operation in this part of Europe in 2023. Apart from enabling the parent company to have full control of the operations of the Netherlands-based business, it will also help it incorporate this type of entity faster compared to other ones.

After the decline registered in 2020, the Dutch economy is expected to recover in 2023 and increase by 3.6% which is why setting up a branch here will be to the benefit of foreign companies.

If you need help in registering a Dutch branch in 2023, do not hesitate to ask for the support of our agents.

FAQ on branch office registration in the Netherlands

Is it hard to register a branch office in the Netherlands?

No, the incorporation of a Dutch branch office can go smoothly if all the documents are correctly prepared and filed.

Does the branch office need a local director?

The branch office does need a local director.

Can the branch office offer any type of services or sell any kind of goods?

The branch office’s activities will be limited to those of the parent company, meaning that it cannot sell any other goods or provide any other services than the parent company.

How long does it take to register a branch office?

The registration process of a branch office can take up to 2 weeks, depending on how soon the parent company prepares all the documents for incorporation.

How is a branch office taxed in the Netherlands?

The branch office will be taxed on its profits earned in the Netherlands. The current corporate tax rates in the Netherlands are 20% and 25% and are levied based on specific income thresholds.

If you have any other questions on branch registration requirements in 2023, our Dutch specialists will answer them.

We invite you to watch a short video about opening a branch in the Netherlands:

If you decide to launch a business in the Netherlands in 2023, there are certain economic facts you should be aware of. According to the most recent forecasts from December 2022, the Dutch National Bank anticipates economic growth of 0.8% in 2023 and 1.6% in 2024. After reaching a record high of 11.5% in 2022, inflation will quickly decline in the years to come. The government’s price cap and the stabilization of energy costs are mostly to blame for this. Inflation is predicted by DNB to be 4.9% in 2023 and 5.0% in 2024.

You can contact our company formation agents in the Netherlands for more information about branches and how to open a company in the Netherlands, such as a STAK in the Netherlands.