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A Dutch partnership agreement sets out how two or more persons work together and share the profit. Dutch law has three partnership forms: the partnership (maatschap, article 7A:1655 Dutch Civil Code), the general partnership (vennootschap onder firma, VOF, article 16 Commercial Code) and the limited partnership (commanditaire vennootschap, CV, article 19). None of them is a legal entity, which matters for liability.
Partnership Agreements in the Netherlands provide an internal business contract between partners in an organization to establish specific rules regarding how each one manages responsibilities, ownership/investments/profit/loss accounting as well as company administration. Our Dutch law firm in the Netherlands has the experience that you require regarding the drafting of a Dutch partnership agreement or the termination thereof.
How do you set up a Dutch partnership contract?
A partnership is formed by an agreement between the partners. For a maatschap, the law sets no formal requirements. A VOF must be entered into by a notarial or private deed, but the absence of a deed cannot be invoked against third parties (article 22 Commercial Code). It is advisable to seek advice from a lawyer specialising in company law when setting up a partnership in the Netherlands.
Which forms of partnership exist under Dutch law?
Dutch law distinguishes three forms. The maatschap is the basic form. A VOF is a maatschap formed to carry on a business under a common name (article 16 Commercial Code). A CV is a partnership between one or more partners who are jointly and severally liable and one or more limited partners who only provide capital (commanditaire vennoten, article 19). A cooperation agreement (samenwerkingsovereenkomst) in which the parties do not bring anything into a community to share the resulting benefit is in principle not a partnership; the general rules of contract law then apply.
What does a partnership mean in The Netherlands?
Under Dutch law, a maatschap is an agreement by which two or more persons bind themselves to bring something into a community, with the aim of sharing the resulting benefit (article 7A:1655 Dutch Civil Code). The contribution can consist of money, goods, the use of goods or work (article 7A:1662).
Partnerships are particularly common in independent professions such as family doctors, notaries, lawyers and consultants. Through the partnership they can, for example, share the costs of a respective project. Where the cooperation runs through a company instead, the shareholders’ agreement in the Netherlands plays the same role.
It is common for the partners of a maatschap to conclude a contract, the so-called partnership agreement in the Netherlands, which regulates, among other things, costs for the respective project and the activities of the individual partners or members. How much influence the joint partnership has on each individual partner depends on the partnership in question and the agreements made between them. If the agreement does not set the profit and loss shares, each partner shares in proportion to its contribution (article 7A:1670). A clause that gives all the profit to one partner is void (article 7A:1672).
Does a partnership have to be entered in the commercial register?
Yes, if the partnership runs a business (onderneming). The commercial register at the Chamber of Commerce (Kamer van Koophandel) includes every business established in the Netherlands that belongs to a maatschap, VOF or CV (article 5(a) Commercial Register Act 2007); the owner of the business must file for registration (article 18). For a VOF, the Commercial Code also requires registration (article 23 Commercial Code). As long as a VOF is not registered, third parties may treat it as a partnership for all business, for an indefinite period and with every partner authorised to act for it (article 29).
Registration is separate from the partnership agreement itself. A maatschap can be formed by an oral agreement between the partners. However, it is advisable to put the partnership agreements in writing to prevent later disagreements. This can be done by private deed or by notarial deed. The partnership agreements in the Netherlands are drawn up jointly by the partners, in particular to agree on the extent to which the partners have influence over each other. Our English-speaking lawyers in the Netherlands will be happy to assist you in drawing up a partnership agreement and advise you on the establishment of the maatschap in the Netherlands.
What is the difference between a maatschap, a VOF and a CV?
None of the three forms has legal personality (under Dutch law, legal personality is granted by statute, for example to the entities listed in article 2:3 Dutch Civil Code, such as the BV and the foundation). The main differences concern authority and liability:
- Maatschap: a partner cannot bind the other partners without their authority (article 7A:1679). Partners who are bound can be held liable by the creditor each for an equal share, even if their shares in the partnership differ, unless otherwise expressly agreed when the debt arose (article 7A:1680).
- VOF: every partner who is not excluded may act on behalf of the partnership and bind it (article 17 Commercial Code). Each partner is jointly and severally liable for the obligations of the partnership (article 18).
- CV: the limited partner is liable only up to the amount it contributed or had to contribute (article 20(3)). If its name is used in the firm name, or it performs acts of management or works in the business of the partnership (even under a power of attorney), it becomes jointly and severally liable for all debts of the partnership (article 21).
Because of the joint and several liability in a VOF, some entrepreneurs use private limited companies (BVs) as partners. A lawyer can advise which structure fits your cooperation.
How do you terminate a partnership contract?
A partnership ends, among other things, when the agreed term expires, by notice given by one partner to the others, and on the death, guardianship or bankruptcy of a partner, or when the debt restructuring scheme for natural persons applies to a partner (article 7A:1683 Dutch Civil Code). A partnership for a fixed term or a specific project cannot be terminated by notice, unless this has been agreed; a notice given contrary to reasonableness and fairness is voidable (article 7A:1686).
Each partner can also ask the court to dissolve the partnership for serious reasons (gewichtige redenen). The court can attach conditions and order a partner who failed to perform to pay damages; the general rules on dissolution for breach of contract (articles 6:265-6:279) do not apply to a partnership (article 7A:1684).
Because a partnership is dissolved by law when a partner gives notice or dies, partnership agreements usually contain a continuation clause (voortzettingsbeding) so that the remaining partners can continue. For the death of a partner, the Code expressly provides that such a clause must be observed (article 7A:1688). The dissolution of a VOF before the agreed date, and changes to the agreement that affect third parties, must be registered in the commercial register (article 31 Commercial Code).
Frequently asked questions about partnership agreements in the Netherlands
Does a Dutch partnership have legal personality?
No. A maatschap, VOF or CV is not a legal entity; Dutch law grants legal personality only where the law provides for it, for example to the private-law entities listed in article 2:3 Dutch Civil Code, such as the BV and the foundation. The partnership acts through its partners.
Are the partners of a VOF personally liable?
Yes. Each partner of a VOF is jointly and severally liable for the obligations of the partnership (article 18 Commercial Code). In a maatschap, partners who are bound are in principle each liable for an equal share (article 7A:1680 Dutch Civil Code). A limited partner in a CV is only liable up to its contribution, unless its name is used in the firm name or it performs acts of management or works in the partnership’s business (articles 20 and 21 Commercial Code).
Does a partnership agreement have to be in writing?
For a maatschap, the law sets no formal requirements. A VOF must be entered into by a notarial or private deed, but the absence of a deed cannot be invoked against third parties (article 22 Commercial Code). A written agreement is advisable in all cases.
Must a partnership be registered with the Chamber of Commerce?
Yes, if it runs a business in the Netherlands (article 5(a) Commercial Register Act 2007). For a VOF, registration is also required by article 23 Commercial Code; until registration, third parties may treat every partner as authorised (article 29).
How can a partner leave a Dutch partnership?
A partner can give notice, unless the partnership was entered into for a fixed term or a specific project and no right to give notice was agreed (articles 7A:1683 and 7A:1686 Dutch Civil Code). A partner can also ask the court to dissolve the partnership for serious reasons (article 7A:1684). A continuation clause in the agreement determines whether the other partners can continue.
Primary sources
- Dutch Civil Code Book 7A (maatschap): articles 7A:1655, 7A:1662, 7A:1670, 7A:1672, 7A:1679, 7A:1680, 7A:1683, 7A:1684, 7A:1686 and 7A:1688
- Dutch Civil Code Book 2: article 2:3
- Commercial Code (Wetboek van Koophandel): articles 16, 17, 18, 19, 20, 21, 22, 23, 29 and 31
- Commercial Register Act 2007 (Handelsregisterwet 2007): articles 5 and 18
Dutch lawyers specialized in collaboration agreements
If you have any questions or require legal assistance regarding partnership agreements in the Netherlands, please don’t hesitate to reach out to our knowledgeable and dedicated team at our Dutch law firm.
