What are the differences between a BV and a Dutch branch company?

When you want to start a business in the Netherlands, but you are not sure if you want to set up a BV or a Dutch branch, please be aware of the following (dis)advantages of a Dutch branch in relation to a BV.

Advantages:

  • A branch is a business that is operated by a foreign entity. Therefore you do not need to set up a separate Dutch entity. This makes setting up a branch easier and less expensive than a BV: administration can be maintained in the home country, closing a branch is easier than closing a BV and you can keep the name and address.
  • If you set up a Dutch branch, the foreign company might be eligible for extra tax deductions in the home country.

Disadvantages:

  • A branch does not have legal personality and therefore the foreign company operating the branch is fully liable for all of the obligations and liabilities of the branch.
  • Having a Dutch legal entity makes the decision-making process easier.
  • Doing business in the Netherlands under a Dutch entity is often better than operating under a foreign name.

 

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