International Law

THE DUTCH CARIBBEAN INCORPORATION DOCTRINE

By Karel.Frielink

The courts apply the law of the state where the legal entity was incorporated

The Netherlands Antilles adheres to the Incorporation Doctrine (Netherlands Antilles State Ordinance of 9 September 1960, which entered into force on the 10th of September 1960, P.B. 1960, 166). According to this doctrine, the internal affairs of a corporation are governed solely by the laws of the state in which it was formally incorporated. This doctrine was confirmed in the cases of Natco Trust v. mr Thesseling q.q., Hoge Raad (Dutch Supreme Court) 20 April 1990, NJ 1991, 560; TAR-Justicia 1 (1991), p. 24-35, and IBC v. Grenoble, Hoge Raad (Dutch Supreme Court) 19 March 1999, NJ 2000, 99.

Accordingly, Netherlands Antilles courts apply the law of the state where a corporation was incorporated as the lex societatis. The law of incorporation governs the corporation’s formation, its shares, the powers, duties and liabilities of shareholders (as such) and the (members of the) Board of Directors and Board of Supervisory Directors (as such), its dissolution, and determines questions of locus standi (i.e. whether or not the NV or BV has the right to bring proceedings) and legal personality.

Karel Frielink

(31 August 2010)

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Full post as published by Karel's Legal Blog on August 31, 2010 (boomark / email).