NETHERLANDS Law and Practice Contributed by: Manon Cremers, Heleen Kersten and Frédérique van der Wegen, Stibbe
2. Corporate Management 2.1 Principal Bodies or Functions
dependent company) has established a works council to which the Works Council Act applies.
2.2 Types of Decisions The Management Board
All BVs and NVs have a management board and a general meeting. BVs and NVs may also have a super - visory board or a one-tier board with executive and non-executive directors. Large Company Regime (Structuurregime) A supervisory board (or a one-tier board consisting of executive and non-executive directors) is mandatory if a company has filed a statement with the Dutch Trade Register for three consecutive years, stating that it qualifies as a “large” company under the statutory two-tier rules ( structuurvennootschap ). This supervi - sory board must consist of three or more directors (or three or more non-executive directors in the case of a one-tier board). Persons employed by a “large” com - pany or any of its dependent companies, as well as directors and employees of an employees’ organisa - tion involved in determining the terms of employment of those persons, cannot be appointed as supervisory directors. The regime applies where, according to the adopted annual accounts, the company’s issued capital and reserves are not less than EUR16 million, it has a works council on the grounds of a statutory require - ment and, as a rule, it employs at least 100 employees in the Netherlands. Dependent companies are taken into account for the second and third requirements. After the three-year period, the articles must incorpo - rate the mandatory large company provisions. Under the full regime, the general meeting and works council can significantly influence the supervisory board’s composition. The supervisory board appoints and removes management board members, and cer - tain important management board resolutions require prior supervisory board approval. Certain holding or finance companies and subsidiaries of companies applying the regime are exempt. Mitigated and Voluntary Application Certain companies may apply the mitigated regime, under which the general meeting appoints manag - ing directors. A company may also voluntarily apply the full or mitigated large company regime if it (or a
The primary responsibility of the management board is to manage the company and its business. In the per - formance of its duties, the management board is col - lectively responsible for formulating and determining policy and strategy, achieving the legal entity’s objects and the day-to-day management of the company and its business. The management board must carry out its duties in line with the company’s objectives, which are included in the articles of association. Depending on the articles of association, the manage - ment board may resolve on the issuance of shares (if this authority is granted by the general meeting), res - ervations of profits, (approval of) interim distributions, and the right of initiative for certain general meeting resolutions, such as share issuances, amendments to the articles, legal mergers, demergers, dissolution and conversion. The Supervisory Board If installed, the supervisory board supervises and advises the management board on the general course of affairs of the company and the business affiliated with it. General Meeting – Shareholders In principle, the general meeting may resolve on appointments, suspension, dismissal and remunera - tion of managing and supervisory directors, increas - es or decreases of share capital, adoption of annual accounts, distributions, amendments to the articles, legal mergers, demergers, dissolution, conversion and appointment of the auditor. The general meeting is entitled to receive information from the management board. The articles of association may provide that certain management board resolutions are subject to approval of the general meeting or supervisory board. For the NV, approval of the general meeting is required for management board resolutions concerning a major change in the identity or character of the company or business.
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