limited liability
Limited liability is a legal status in which a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a corporation, company or partnership. If a company that provides limited liability to it ...
, but no members or share capital, that exists for a specific purpose. This form of entity makes it possible to separate functions of ownership and control. Its use has been pioneered successfully in recent years as a ' poison pill' style defence tactic in hostile takeover situations by Scott V Simpson, one of Europe's leading mergers and acquisitions lawyers.
Formation
A ''stichting'' is a legal person created through a legal act. This act is usually either a notarised deed (or a will) that contains the articles of the foundation which must include the first appointed board. No government authority is involved in the creation or authorization of a foundation. It acquires full legal capacity through its sole creation. A foundation has no members and its purpose must be stated in its articles, using capital dedicated to such goal. The foundations are defined in the Dutch Civil Code (
Burgerlijk Wetboek
The ''Burgerlijk Wetboek'' (or BW) is the Civil Code of the Netherlands. Early versions were largely based on the Napoleonic Code. The Dutch Civil Code was substantively reformed in 1992. The Code deals with the rights of natural persons (Book 1 ...
), Boek 2 Art 285-304. It is not necessary in the Netherlands that a foundation serves a purpose of general interest, but its official goal cannot include making payments to anybody, except for charitable causes. A foundation is governed and represented by a board that is responsible for the foundation's administration. The board does not have a requirement for specific number of members.
Art. 2:289 of the Civil Code establishes that all foundations must be registered in the Register of Commerce or "Kamer van Koophandel". Commercial activities are allowed if they are within the purpose of the foundation and are taxed. Board members can be held liable for the foundation, civilly as well as criminally.
The Dutch Tax Service can declare an institution to be an "institution for general benefit" ( ANBI), with tax benefits. Often, but not necessarily, this is a foundation. Conversely, not every foundation qualifies.
Examples
Charitable organizations
*
Cornelis Kruseman Stichting
The Cornelis Kruseman - J.M.C. Ising Foundation (Dutch: ''Cornelis Kruseman - J.M.C. Ising Stichting'') is a Dutch foundation (stichting) that was established in 1996 and is located in The Hague, Netherlands. The foundation's objective is to bring ...
– purpose: bring the work of painter
Cornelis Kruseman
Cornelis Kruseman (; 25 September 1797 – 14 November 1857) was a Dutch painter, draughtsman, etcher, lithographer, silhouettist, paper-cut artist, and art collector.Stichting Museumjaarkaart – purpose: promote visits to Dutch museums.
*
Nederlandse Omroep Stichting
The Nederlandse Omroep Stichting (; NOS ; English: Dutch Broadcasting Foundation) is one of the broadcasting organisations making up the Netherlands Public Broadcasting system. It has a special statutory obligation to make news and sports progra ...
– purpose: make news and sports programmes for the three Dutch public television channels and the Dutch public radio services.
* Stichting FERN – purpose: promote greater environmental and social justice, focusing on forests and forest peoples’ rights.
*
Stichting INGKA Foundation
The Stichting INGKA Foundation is a Dutch foundation founded in 1982 by Ingvar Kamprad, a Swedish billionaire and founder of IKEA, and his corporate attorney Linnea Walsh. INGKA is one of the largest charitable foundations in the world and used ...
– purpose: promote and support innovation in the field of architectural and interior design.
*
Stichting Max Havelaar
Fairtrade Nederland formerly known as Max HavelaaStichtingis the Dutch member of Fairtrade International, which unites 23 Fairtrade certification producer and labelling initiatives across Europe, Asia, Latin America, North America, Africa, Austr ...
Wiardi Beckman Stichting
The Wiardi Beckman Stichting (The Wiardi Beckman Foundation) is a Dutch think tank linked to the left-of-centre Labour Party (PvdA).http://www.wbs.nl/over-de-wbs Information Wiardi Beckman Stichting
The foundation is named after Herman Bernard ...
– purpose: a think tank linked to the Labour Party ( PvdA).
*
Mars One
Mars One was a small private Dutch organization that received money from investors by claiming it would use it to land the first humans on Mars and leave them there to establish a permanent human colony. From its announcement in 2012 to its ...
– purpose: establish a permanent human colony on Mars.
*
MINIX 3
Minix 3 is a small, Unix-like operating system. It is published under a BSD-3-Clause license and is a successor project to the earlier versions, Minix 1 and 2.
The project's main goal is for the system to be fault-tolerant by detecting and rep ...
– Stichting MINIX Research Foundation - purpose: Support and develop Minix3 Operating System.
*
Urgenda
Urgenda is a nonprofit foundation (stichting) in the Netherlands which aims to help enforce national, European and international environment treaties. In 2013, Urgenda filed a lawsuit against the state of the Netherlands – respectively also ag ...
''Stichtingen'' (Dutch plural form) are used as a type of poison pill (takeover defense mechanism) for publicly traded companies. In one case, the Dutch-incorporated pharmaceutical company
Mylan
Mylan N.V. was a global generic and specialty pharmaceuticals company. In November 2020, Mylan merged with Upjohn, Pfizer's off-patent medicine division, to form Viatris. Previously, the company was domiciled in the Netherlands, with principal e ...
established a ''stichting'' for the purpose of "safeguarding Mylan’s strategy, mission and independence" and gave the ''stichting'' the right to veto any proposed
hostile takeover
In business, a takeover is the purchase of one company (the ''target'') by another (the ''acquirer'' or ''bidder''). In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to t ...
of Mylan. The ''stichting'' was activated in July 2015 to block a planned takeover by
Teva Pharmaceutical Industries
Teva Pharmaceutical Industries Ltd. (also known as Teva Pharmaceuticals) is an Israeli multinational pharmaceutical company with headquarters in Tel Aviv, Israel. It specializes primarily in generic drugs, but other business interests include ...
.
Finance and investment
''Stichtingen'' are used by institutional investors, such as banks and wealthy individuals, as a means of controlling assets while not having legal ownership or consolidating the assets on their financial statements. The properties of a ''stichting'' can be used to avoid inheritance tax,
trade sanctions
Economic sanctions are commercial and financial penalties applied by one or more countries against a targeted self-governing state, group, or individual. Economic sanctions are not necessarily imposed because of economic circumstances—they ma ...
and
expropriation
Nationalization (nationalisation in British English) is the process of transforming privately-owned assets into public assets by bringing them under the public ownership of a national government or state. Nationalization usually refers to pri ...
. In one case, the Libyan-based oil company
Oilinvest
Tamoil is the trading name of the Oilinvest Group, a fuel energy provider within the European downstream oil and gas sector. The Oilinvest Group refines crude oil and markets refined oil products primarily under the Tamoil and the HEM brands in ...
used a ''stichting'' structure to avoid sanctions on Libya and ensure its continued operation following the overthrow of Muammar Gaddafi; in another case, the Russian oil company
Yukos
OJSC "Yukos Oil Company" (russian: ОАО Нефтяна́я Компа́ния Ю́КОС, links=no, ) was an oil and gas company based in Moscow, Russia. Yukos was acquired from the Russian government by Russian oligarch Mikhail Khodorkov ...
used a ''stichting'' structure in an attempt to shield its assets from tax claims by the Russian government.
Netherlands Antilles
Foundation legislation was last reformed in 1998, giving rise to the Netherlands Antilles Private Foundation (Stichting Particulier Fonds).
Besloten vennootschap
A (, lit. " closed company"; formally a , , ) or (SRL) is the Dutch and Belgian version of a private limited liability company. The company is owned by shareholders; the company's shares are privately registered and not freely transferable. ...