THE ARTICLES OF ASSOCIATION OF A CURAÇAO COMPANY (I)

Comparable with a constitution

The articles of association of a Curaçao company (a public [NV] or private [BV] limited liability company) are somewhat comparable with a constitution or state regulations: the articles of association comprise – like the law, but also additionally to the law and, where permitted, unlike the law – the rules of play (rights, obligations and powers) to which all the organs of the company (managing board, supervisory board, shareholders’ meeting) and the members of those organs must adhere or on which they can rely.

The law of Curaçao does not prescribe that a special (or qualified) …
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09
Oct 2013
CATEGORY

Corporate

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VALIDLY REPRESENTING A CURACAO COMPANY

Extract and Articles are of importance

Limited liability companies like the Curaçao NV or BV are legal entities. Whether or not a managing director has the authority to validly represent a company can be derived from the extract from the Trade Register of the Chamber of Commerce of Curaçao together with the articles of association of the company.

However, it could be the case that the company has further regulations from which representation limitations follow. This should be assessed on a case by case basis.

A counterparty may rely on a written statement from the board of managing directors or …
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26
Sep 2013
CATEGORY

Corporate

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ASSET PROTECTION IN CURACAO

Curaçao: a jurisdiction not to be missed

A Curaçao private foundation or a trust is often used for asset protection and privacy purposes. The Curaçao private foundation and the Curaçao trust must be set up by a notarial deed executed before a civil law notary in Curaçao. Both the private foundation and the trust are a very flexible solution for asset protection and privacy purposes. A private foundation, for instance, can be easily implemented in international holding structures through Curaçao and is very suitable for family asset protection. By means of a letter of wishes or provisions in the articles …
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20
Aug 2013
CATEGORY

Finance

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THE COSTS OF LITIGATION

Parties have to bear their own attorney costs

Under the laws of Aruba, Bonaire, Curaçao, St. Maarten, St. Eustatius and Saba, generally speaking, each party has to bear its own attorney costs, except if there is an agreement in place between the parties providing for such compensation. Other costs related to proceedings are for instance bailiff costs and court fees.

The extent to which the aforementioned costs of litigation are to be borne by the party losing the case are determined by the court. The costs will in fact not compensate the actual costs and attorneys fees incurred. They are …
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12
Aug 2013
CATEGORY

Legal

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THE CURACAO TRUST

Can be used as protected or segregated cell company

On 1 January 2012, new legislation entered into force according to which it is now possible to set up a trust (Curacao Trust) similar to the trust in Anglo-Saxon common law jurisdictions. The introduction of the Curacao Trust serves as an important instrument which could be used within financial transactions in the Caribbean as a significant part of these transactions are initiated from common law jurisdictions.

The Curacao Trust can be used for different purposes, such as, for example:

  • To set aside capital for children’s upbringing, education or maintenance
  • Estate planning

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    02
    Aug 2013
    CATEGORY

    Finance

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    A CURACAO COMPANY WITH NEGATIVE EQUITY AND FINANCIAL SUPPORT

    Restrictions for providing financial support to a party acquiring shares in its capital?

    A company cannot purchase its own shares if it has a negative equity capital or when this equity capital becomes negative by purchasing them, whereby the nominal capital applies as the lower limit (Section 2:114 subsection 2 of the Curaçao Civil Code in conjunction with Section 2:118 subsections 5 to 7 of the Curaçao Civil Code).

    The question is, however, whether a Curaçao NV (public limited company) or BV (private limited liability company) with negative equity is allowed to provide financial support to a third party acquiring …
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    26
    Jul 2013
    CATEGORY

    Corporate

    COMMENTS No Comments

    THE INDEPENDENT SUPERVISORY BOARD IN CURACAO

    Should be mandatory for government-owned entities

    Under the laws of Curaçao, the main task of a board of supervisory directors is to supervise the board of managing directors of a limited liability company (NV or BV).

    The Corporate Code provides for two different kinds of boards of supervisory directors, a “regular” board of supervisory directors and the so-called “independent” board of supervisory directors (Section 2:139 Curaçao Civil Code). Within this context the word independent means that the supervisory directors are independent of the shareholders, interest groups (“belangengroepen”) and to a certain extent from the shareholders’ meeting.

    An independent board of …
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    19
    Jul 2013
    CATEGORY

    Corporate

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    THIS BLOG IS ARCHIVED BY THE LIBRARY OF CONGRESS

    Blogs of today can be studied for years to come

    I’m thrilled to learn from Robert Ambrogi’s blog that “Karel’s Legal Blog” has been archived in the Library of Congress:

    On the Internet there is no rule against perpetuities. To the contrary our perpetuation seems assured. Latest case in point: the new Legal Blawgs Web Archive from the Library of Congress. Yes, just as the LOC is archiving all of our tweets, turns out it is also archiving a selection of legal blog posts, and has been doing so since March 1, 2007. (…)

    The LOC describes …
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    17
    Jul 2013
    CATEGORY

    Various

    COMMENTS No Comments

    THE REPAYMENT OF SHARE PREMIUM IN CURACAO

    Net equity may not be or become negative

    From the legal point of view in Curaçao, share premium (’agio’) forms part of the company’s free reserves (Curaçao law does not provide for statutory reserves), and does not qualify as share capital. If share premium is to be repaid, the company’s financial condition should at the time allow for it, i.e. the net equity of the company may not be or become negative as a result of such repayment.

    If the company has shares with a nominal value, the repayment may not result in the nominal capital exceeding the net equity …
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    12
    Jul 2013
    CATEGORY

    Corporate

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    BEARER SHARES IN A CURACAO COMPANY

    Registered shares must be issued first

    According to the Curaçao act on corporate law (Book 2 Curaçao Civil Code) it is not possible to (directly) issue bearer shares.

    A company with only bearer shares has no shareholders’ register. Only a public limited liability company (NV) may issue bearer shares, provided that registered shares be issued first and that they have been fully paid up. These may subsequently be converted into bearer shares. The issuance (of registered shares) requires a ‘deed of issuance’, which must be signed by both the company and the subscriber. Without such a deed the subscriber does …
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    05
    Jul 2013
    CATEGORY

    Corporate

    COMMENTS No Comments

    PREJUDGMENT ATTACHMENT IN CURACAO

    A petition is only marginally examined

    How easily can one obtain permission to freeze assets? The Curaçao Code of Civil Procedure provides the possibility to seize and freeze assets in anticipation of a court order to pay a certain amount or to return certain goods. This legal remedy is referred to as prejudgment attachment or seizure (“conservatoir beslag“).

    In general, a petition for the attachment of assets is (more or less) only marginally examined by the court and will therefore be granted in most cases. The claimant must then submit a writ of summons or claim form to the court, …
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    28
    Jun 2013
    CATEGORY

    Legal

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    LAWYERS AND THE INTERNET: BACK IN TIME

    A 1996 Tour of some interesting WWW sites for Lawyers

    In 1996 Delia Venables wrote an internet tour for lawyers (‘Around the World in 80 Minutes‘, Web Review, 1996 (3) The Journal of Information, Law and Technology; click here). She referred to the website of the Daily Telegraph as a good example of how the WWW could be made really useful and interesting. She mentioned that the USA was already a long way ahead of Europe in the provision of legal materials on the Internet. She also mentioned the International Law Page created by a law student …
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    17
    Jun 2013
    CATEGORY

    Various

    COMMENTS No Comments