About trust companies
Trust companies are alicensed party that is authorised to provide directorship and registered address to Dutch businesses. A trust company, either located in Amsterdam or any other location in the Netherlands, has the authority to act as a director or attorney for a business.is a developed industry nowadays. These companies are providing their services to companies and sometimes persons. There are a couple of tasks and responsibilities which a trust company has to fulfil.
How do trust companies work?
A trust company is a form of company which is often owned by some corporate services group. Either its coordination ofor management, corporate services companies serve the customers in their great way. A trust company works for helping and assisting the businesses and high net worth individuals in managing their business and assets.
- Company formation
At the time of a company formation, the trust company also plays a crucial role. Many trust companies provide formations services, like. The aim is to provide trust services and serving the company as a custodian after the company’s establishment. Company formation agents coordinatethe incorporation process in cooperation with a civil notary.
- Consider the stakeholders
A trust company has to take care of a few things while providing trust services. While making any decision regarding the company, he must be independent and consider all the concerned stakeholders. Under Dutch law, anominee director, either a corporate or personal director, has to focus on the interests of amongst others employees, shareholders, environment, business partners, customers.
- Have a responsibility for the financial situation
It is the responsibility of the nominee directorto enable the company to meet all its financialobligations In the event of a distribution balance sheet and distribution tests shall be prepared and approved by the board.
- Manage affairs and expenses
Some clients are much involved in the management of their Dutch entity and choose the professional services providers involved such as tax advisors and notaries. Other clients prefer a one stop one shop approach and leave all coordination with the trust company.
- Distribution of assets
Tax efficient distribution of profits is often an important reason for the use of a trust company. The Dutch participation exemption and high number of tax treaties are enticing features. Though the number of tax driven structures is quickly dropping. Flexible law, that enable complex cooperations and priority shares that enable the founding family in control of the business is more and more the reason to choose for a Dutch holding company.
- Manage efficiency and compliance
For managing a business or company efficiently, the trust director must have adequate knowledge and skills. The director must have complete info and records on all assets and liabilities of the business. For effective and efficient management, appropriate decisions matter a lot. A nominee director always works prudently and in accordance with all local regulations. The requirements of the Act on Supervision of Trust Companies require extensive client acceptance and anti-money laundering checks. Also insight in the money flows in the structure, tax ratio and social responsibility are necessary.
The above description concludes that a trust company is licensed corporate services provider that helps most often holding and financing companies and sometimes individuals manage their assets and businesses. A trust company has a wide range of responsibilities to fulfil for all stakeholders of the business. The nominee director must take into account all the compliance processes such an extensive client acceptance and transaction monitoring.