If a company decides to enter the European market, one of the most important steps is to acquire a local business address. Having a business address in the Netherlands, if you are planning on expansion into the European market, is a major asset. This allows locals to recognize and trust your business. To register a business in the Netherlands a business address is required by the Chamber of Commerce and the Tax Administration. A business address will give the company the opportunity to register a private company (for example a besloten vennootschap (BV.)) in the Netherlands.
Acquiring a register address from a Business Center that provides Virtual Offices Solutions is a cost-effective option. Virtual offices are already professionally set up and staffed to allow a company to move right in and hit the ground running with their operations. The service provides a postal address, receives the post and provides the option that the post can be e-mailed to the company in pdf format. There is also the possibility to rent an actual workspace or office and meeting rooms as needed.
However, according to the Dutch Chamber of Commerce and the Tax Administration, a Virtual Address is not an accepted business address. A post box address is also not allowed as an official business address due to the favourable Dutch tax dispensation.
If a company uses the address of a multi-company business centre and the lease agreement states that the company has less than 40 hours a week access to an office the Chamber of Commerce may even de-register the company. There are some critical pitfalls to be aware of before you decide on the route of action.
Using a virtual address may not be a problem initially, until the company receives the following letter: ‘Ambtshalve wijziging’ (‘official change’) or ‘Buitendienst’ (‘sales force’), ‘uw onderneming zal worden uitgeschreven uit het handelsregister’ (‘your company will be unsubscribed from the commercial register’). In the letter, they refer to Article 38 Handelsregisterwet (Commercial Registers Act), and that the Chamber of Commerce is investigating the company with the so-called ‘Bureau Economische Handhaving’ (‘Office Economical Guard’) or the Dutch Tax Administration.
The Dutch Chamber of Commerce and Tax Administration is very active lately in checking registration addresses.
However, a virtual office can still be an excellent starting point for a company if the following important requirements are adhered to:
Several companies and Business Centers in the Netherland offer packages with the possibility to acquire an address of registration and a workplace that complies with the mentioned conditions. The author of the article can be contacted at firstname.lastname@example.org for more information and guidance on avoiding pitfalls and taking the right decisions upon entering the Dutch market.
Article by André Beukes
Business Development and Human Capital Director at Styleau, Founder of Expand to Europe Executive Network.