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Frequently Asked Questions

REAL ESTATE & CONSTRUCTION LAW

When acquiring real estate property in Curaçao, mandatory rules and regulations with respect to real estate, zoning, construction and the environment are to be taken into account.

STRUCTURES FOR DOING BUSINESS

In Curaçao, one can operate a business by using different legal forms. A distinction can be made between legal entities such as limited liability companies and foundations and legal forms without legal personality, such as sole proprietorships and partnerships. For a foreign legal entity, it is also possible to do business via a branch office.

LEGAL ENTITIES

The mandatory regulations with regard to legal entities under private law (such as the foundation and the (private) limited liability company) which can be used for doing business in Curaçao, are contained in Book 2 of the Civil Code. The legal entities explicitly regulated are:

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  • The foundation (stichting);

  • The private foundation (stichting particulier fonds, SPF);

  • The association (vereniging);

  • The cooperation (coöperatie);

  • The mutual guarantee company (onderlinge waarborgmaatschappij);

  • The public limited liability company (naamloze vennootschap, N.V.); and

  • The private limited liability company(besloten vennootschap, B.V.).

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Legal forms without legal personality

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Depending on, amongst others, the nature and size of the business, business activities and tax structure, one can opt for several legal forms which do not have legal personality:

  • The sole proprietorship(eenmanszaak);

  • The public partnership(openbare vennootschap);

  • The silent partnership(niet openbare vennootschap);

  • The limited partnership(commanditaire vennootschap).

 

The N.V. and the B.V. are, beside the sole proprietorship (eenmanszaak) the most common formal structures for the conduct of business in Curaçao.

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Branch office

Foreign entities can also register a branch office to conduct business activities in Curaçao. For doing business in Curacao through a branch office, the foreign entity needs a business license.

SOLE PROPRIETORSHIP

With a sole proprietorship there is no distinction between the personal and business assets. As a result, all assets and liabilities pertaining to the proprietorship constitute the income and expenses of the owner. Creditors of a sole proprietorship have recourse directly on the personal property of the owner, whereas private creditors can also recover their claims from the assets of the business.

 

The owner of a sole proprietorship born outside Curaçao needs a business license for opening a business on Curaçao. No management license is required to establish and operate a sole proprietorship. A written petition to establish a sole proprietorship can be filed with the Ministry of Economic Development of Curaçao.

LEGAL ENTITIES

The public limited liability company (N.V.)

An N.V. is a legal entity with one or more registered transferable shares or shares made out to bearer.

 

Incorporation

The N.V. is incorporated by notarial deed executed by one or more incorporators before a civil law notary in Curaçao. This notarial deed of incorporation constitutes the definitive statutes and regulations governing the company and conduct of its affairs and those statutes and regulations are generally referred to as the articles of association.

 

Registration

Once incorporated, the N.V. must be registered with the Commercial Registry of the Chamber of Commerce and Industry. Details to be filed include the object of the N.V., its share capital (if any) and the particulars of the managing director(s), supervisory director(s) (if any) and possible attorneys-in-fact acting under general powers of attorney (procuratiehouders). There is no requirement to disclose the identity of shareholders.

 

Share capital

From a company law perspective, there is no minimum share capital. Based on regulatory requirements, there are, however, minimum capital requirements for finance companies issuing publicly traded debt bonds, investment institutions, insurance companies and banks.

 

Shares

Shares of a N.V. can only be issued in registered form. If shares are in registered form, a share certificate can be issued.

 

Management

A management board (Raad van Bestuur) consisting of one or more managing directors, (bestuurders) who can be individuals or corporations, manages the N.V. The management board represents the company, defines its business policy and manages its affairs. There are no restrictions on the nationality of managing directors. In some cases, it is required to have at least one managing director being a resident of Curaçao (either an individual or a corporation). If provided for in the articles of association a N.V. may have a supervisory board (Raad van Commissarissen) to oversee the management of the company and to advise and to supervise the management board. A supervisory board must exclusively consist of natural persons. Unless the articles of association determine otherwise, managing directors and supervisory directors are appointed by, and can be suspended or dismissed by, the general meeting of shareholders.

 

General meeting of shareholders

Unless the articles of association determine otherwise, shareholders meetings must be held in Curaçao. Attendance by proxy is permitted. Unless the articles of association state otherwise, a simple majority of votes present and represented at meetings can validly adopt resolutions with no quorum requirements. Written resolutions can also be adopted outside of a general meeting of shareholders, provided all persons entitled to attend a general meeting of shareholders have agreed with this manner of decision-making: An annual general meeting of shareholders should be held at least once a year, usually within eight months after the end of a company’s financial year. At the annual general meeting the financial statements and a report of the managing board should be submitted for approval together with such other matters as may be set out in the notice convening the meeting. Extraordinary general meetings of shareholders may be convened from time to time to deal with matters that arise during the course of the year. Such extraordinary general meetings may also, in certain cases, be convened by the management or supervisory board at the request of shareholders controlling 10% or more of the issued voting shares.

 

Financial year 

The financial year of a N.V may be the calendar year or any other twelve-month period to be specified in the articles of association. Each year, the management board has to draw up financial statements within eight months after the lapse of the financial year, which statements consist of at least a balance sheet, a profit and loss statement and an explanatory note to these statements. The general meeting of shareholders may extend this period by six months at the most, based on ‘special circumstances’. The Civil Code does not elaborate on what would be considered special circumstances.

 

Accounting and financial statements

The financial statements have to comply with generally acceptable standards and have to provide such insights, that a sound opinion can be formed on the capital and the results, as well as on the solvency and the liquidity of the company, in as far as the nature of the financial statements allows this. The Civil Code does not state what rules as to financial reporting are considered generally acceptable. For N.V’s designated by Book 2 of the Civil Code as being “large”, specific and more stringent requirements apply with regard to the accounting principles and criteria for the composition of the financial statements, the publication of the financial statements, as well as with regard to the obligation to have them audited by experts.

 

Profits and distributions

The net profits of a N.V are at the disposal of the shareholders who can either declare a dividend or reserve the profits. If the articles of association so provide, interim dividends may be declared from current year profits by the shareholders meeting or such other corporate body as appointed thereto in the articles of association. Dividends and other capital distributions cannot be paid and made if the equity capital is or becomes negative as a result of such dividend or distribution. If the company has a nominal share capital that capital is considered the limit.

THE PRIVATE LIMITED LIABILITY COMPANY (B.V.)

The B.V. is a flexible form of company.

 

The B.V. is a company similar to the N.V. The main differences as compared to the N.V. are:

  • The B.V. has registered shares only;

  • The articles of association of the B.V. may contain a provision providing for a different manner for dissolution of the company;

  • There is no distinctive financial regime such as for the “large” N.V.;

  • On the initiative of an individual shareholder general shareholders meetings for the B.V. can be convened;

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The B.V. can be organized in such a manner that it is “managed by shareholders”: in that case there is no distinction between the shareholders and the managing directors as corporate bodies.

The option of a company “managed by shareholders” has been introduced for the B.V. This form of the B.V. does not have a management board as a separate corporate body. The joint shareholders or the sole shareholder act(s) as management, which simplifies the taking of corporate action and the management of this type of company in general.

 

Since no managing directors have been appointed as such, there are no formalities of appointment, suspension and dismissal of managing directors, nor is there a difference between a general meeting of shareholders and management board meetings in this case. The shareholders may determine the details of the way in which they will manage the company and the division of tasks mutually agreed upon in a shareholders’ agreement. Using this type of company, a legal concept can be created that resembles the partnership (vennootschap or commanditaire vennootschap), and at the same time benefits from the facts that, as opposed to partnerships, this company managed by shareholders is a legal entity with the ability to act, sue and be sued in its own name and the shareholders are only liable for such company’s debts up to the amount to be paid on those shares (if any).

THE FOUNDATION

A foundation is a legal entity in its own right with its own assets and liabilities. The legal concept of the foundation was developed from capital being set aside for a special non-profit or charitable purpose and was originally used by religious and welfare groups. The foundation is still frequently used for religious and non-profit organizations. Distributions to incorporators or to those, who constitute its bodies, are not allowed – save in case of a private foundation – and its distributions are furthermore restricted by law to distributions with a charitable or social purpose.

The foregoing does not mean that the use of a common foundation is restricted to charitable purposes. It can be and is extensively used in structures in which the foundation is the legal owner of assets of which others hold the economic ownership.

 

The principal difference between a foundation and a corporation is that a foundation has neither members nor shareholders, nor a capital divided into shares. The board of a foundation, which manages its affairs, is therefore not subject to the overall control of shareholders or members. The initial management board is appointed at the moment of incorporation. Thereafter, vacancies are filled at the sole discretion of the management board in office or by another person or body especially nominated for that purpose.

 

Formation of a foundation

A foundation is established by notarial deed executed before a civil law notary in Curaçao. The articles of incorporation of a foundation must include the name of the foundation, including the word foundation or a translation thereof, its purpose, the first management board and the manner how managing directors are appointed and dismissed, the seat of the foundation and the designation of the balance after liquidation in the event of dissolution of the foundation or the manner in which the designation shall be determined.

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Assets of a foundation

Unlike a company, a foundation has no capital per se, since it has no shares or shareholders. The founder of a foundation can contribute to the foundation the initial assets at the time of establishment of the foundation or on any date afterwards.

 

Management of a foundation

A management board , consisting of one or more managing directors, manages a foundation. The powers of the management board are set out in the articles of association of the foundation.

A foundation may also have a supervisory board which supervises the board in accordance with the articles of association. The founder of a foundation and members of the management board and the supervisory board cannot participate in the assets and/or profits of a foundation.

 

THE PRIVATE FOUNDATION

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For purposes of international tax and estate planning the private foundation has been introduced as a flexible variant of the long existing ‘common’ foundation which variant is comparable to a trust. The Dutch name is Stichting Particulier Fonds, abbreviated SPF.

As mentioned, the private foundation is a foundation but a specific and flexible form thereof. The private foundation is, like other foundations, a separate legal entity, with assets and liabilities in its own name. Furthermore, a private foundation neither has shareholders, members or the like. Beneficiaries do not have to be appointed if such appointment is not desired.

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Therefore, the purpose of a private foundation may include the making of distributions to incorporators and or others, such as children or grandchildren of the founder, without serving a charitable or social purpose. Beneficiaries of such distributions can – but are not required to – be appointed/designated in the articles of association, and if such is done, either in very general or very specific terms.

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Another major difference between common and private foundations is that the private foundation’s purpose may not be to conduct a business or enterprise for profit. Managing its assets (investments, equities etc), to act as a holding corporation, or to participate as a partner in a limited partnership, will however not be regarded as ‘conducting a business’. Under the provisions of Book 2 of the Civil Code, the foundation may and should invest its assets and may do so actively. There are no limits on the type of investments.

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Incorporation of the private foundation

Like the common foundation, a private foundation is incorporated as such by deed executed before a civil law notary in Curaçao. As to the requirements on the contents of the articles of incorporation we refer to Formation of a foundation where this is described for the common foundation.

PARTNERSHIPS

​Within Curaçao’s legislation there are three forms of partnerships:

Public partnership

A public partnership is a partnership that carries out a profession or business (or performs professional or business acts) and acts externally in a for third parties clearly identifiable manner under a name used by it as such. A public partnership is referred to as openbare vennootschap.

The possibility exists to convert a public partnership into an N.V. or a B.V., in which case the partners of the public partnership will become shareholders of the N.V. or B.V. by law, proportionate to their former share in the public partnership.

 

Silent partnership

A silent partnership is a partnership that is not a public partnership and is referred to as stille vennootschap. Therefore, a partnership which does not carry out a profession or business or a partnership which does not participate in transactions is a silent partnership.

 

Limited partnership

A limited partnership is a public partnership in which there is a distinction drawn between the limited partners and the general or managing partners and is referred to as the Commanditaire Vennootschap (“CV”). The general or managing partners manage the affairs of the CV and represent it in dealings with third parties. They are jointly and severally liable for the debts resulting from the enterprise of the CV.

A limited or “silent” partner, however, contributes to the partnership a certain amount of capital. His liability is limited to the amount of capital contributed. A limited partner is prohibited from directly managing the affairs of the CV, however he can represent the general partners as their attorney-at-fact. If a limited partner is involved in the direct management of a CV he forfeits his right to the protection of limited liability and becomes jointly and severally liable for the debts resulting from the enterprise of the partnership, together with the general or managing partners.

 

Incorporation of a partnership

Curaçao law partnerships are formed by either a notarial deed or a private deed. The absence of a deed can, however, not be used to contest claims of third parties. Curaçao law partnerships must be registered at the Commercial Registry of the Chamber of Commerce and Industry. It is not necessary to disclose the identity of limited partners. Foreign corporations and/or individuals can act as limited or as general or managing partner.

LICENSES

Under the Laws of Curacao each company needs to have:

  • A license for the managing directors to act as such;

  • A license to carry out business.

Pursuant to the Business Establishment Rules (Vestigingsregeling voor bedrijven), a business license application can be denied in the interest of public policy and also, if in the opinion of the government of Curaçao, the public interest so dictates. Business licenses are issued on the condition that the business for which they have been granted must have commenced within six months of the date of the granting of the business license. Foreign legal entities also have the possibility to request the government for a business license for the purpose of establishing a branch office of the foreign legal entity to conduct a business in Curaçao.

For some international or cross border transactions a specific or general foreign exchange license or exemption may be required. In other cases, the acquisition of a business in Curaçao by a non-resident requires a foreign exchange license or a written notice to the Central Bank of Curaçao and St. Maarten. Such licenses and notices are for the purpose of enabling the Central Bank to monitor the changes in local and foreign currency reserves.

CONVERSION, MERGER & DIVISION OF LEGAL ENTITIES

The final chapter of Book 2 of the Civil Code deals with the possibilities of conversion (change of legal form), merger and division of legal entities. In case of a merger, a foreign legal entity with a similar legal form may also act as the legal entity to merge or merge into.

The conversion into or from a foreign legal entity from or into a Curaçao legal entity (a cross-border change of corporation form) is worth mentioning.This replaces the transfer of registered seat and applies to all legal entities.

 

Liquidation

The voluntary liquidation of a legal entity starts with a resolution of the shareholders, members, an interested party or the Court (as the case may be) to that effect. The liquidator needs not be a resident of Curaçao and can be either an individual or a company. In the absence of the appointment of a liquidator, the board or the Chamber of Commerce and Industry (as the case may be) are to act as liquidators.

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Once a company is in liquidation, the liquidator manages the affairs. The legal entity continues to remain in existence but only in so far as this is necessary for the liquidation and dissolution of its affairs. The liquidator converts the assets of the legal entity into cash, settles the relationships with third parties and pays the debts. The balance that remains after payment to the creditors is distributed to the persons that are entitled thereto by virtue of the articles of association, or to the members or shareholders. If the assets are not sufficient to pay all debts, the liquidations must file the legal entity’s bankruptcy and the liquidation is then converted into a bankruptcy subject to the Court’s supervision.

 

Stock exchange

The Dutch Caribbean Securities Exchange (DCSX) is an international exchange for the listing and trading in domestic and international securities (bonds, equities and funds) based in Curaçao. DCSX is the only authorized securities exchange and is licensed by the Minister of Finance, Government of Curaçao and supervised by the Central Bank of Curaçao and Sint Maarten.

DCSX forms part of the international financial services sector of Curaçao that is well known with a longstanding reputation, dating back to the early 1930s. Furthermore, DCSX is an affiliate of the World Federation of Exchanges and is since January 29,2020, an official member of AMERCA- Asociación de Mercados de Capitales de las Américas (Association of Capital Markets of the Americas), formed by the Stock Exchanges of Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua, Panamá and the Dominican Republic.

 

The DCSX provides local as well as international companies, investment funds and Exchange Traded Funds (ETF’s) with a time- and cost efficient listing procedure for equity-, funds- and bond listings.

Any institution that wishes its security listed on the DCSX is required to engage a Listing Advisor and an broker (local or internation bank) authorized by DCSX to broker securities on DCSX.

Currently, Vidanova Global Custody Foundation, acts as the current central depository and custodian of the DCSX.

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DCSX has developed sophisticated listing requirements for the issuer, tailored to the needs of the market. The emphasis lies on the disclosure of vital information in a cost and time-efficient procedure that guides the issuer through the administrative process. DCSX ensures transparency for the investor and guarantees visibility for the issuer at all times. The listing fees of DCSX are kept highly competitive.

 

Role of the Central Bank of Curaçao and St. Maarten

The most important objectives of the Central Bank of Curaçao and St. Maarten (the “Central Bank”) are to maintain the external stability of the Netherlands Antillean Guilder (ANG) and to promote the efficient functioning of the financial system in the countries of St. Maarten and Curaçao.

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Main tasks 

As stipulated in the Central Bank Charter for Curaçao and St. Maarten (Centrale Bank-statuut voor Curaçao en St. Maarten), the main tasks of the Central Bank are to supervise the financial sector in both Curaçao and St. Maarten. This supervision includes: (i) monetary supervision; (ii) business economic supervision;  and (iii) supervision of integrity. In doing so the Central Bank has the tasks and powers to:

  • Conduct the monetary policy in Curaçao and St. Maarten;

  • Supervise banking and credit institutions in Curaçao and St. Maarten;.

  • Issue paper money in the countries of Curaçao and St. Maarten;

  • Manage the foreign exchange reserves of Curaçao and St. Maarten;

  • Act as the government’s treasurer by receiving and making payments from and to the public; and

  • Advise the governments of Curaçao and St. Maarten and on financial and economic matters.

 

Supervision of financial institutions

The Central Bank is entrusted with the prudential supervision of credit institutions, insurance companies and other institutional investors (pension funds, insurance brokers), money transfer companies, investment companies and their administrators, trust service providers  and the Dutch Securities Exchange (DCSX) based on the National Ordinance on the Supervision of Banking and Credit Institutions (Landsverordening toezicht bank- en kredietwezen), National Ordinance containing regulations concerning the supervision of the Insurance industry (Landsverordening houdende regelen inzake het Toezicht op het Verzekeringsbedrijf), National Ordinance on the Supervision of Money Transfer Companies (Landsverordening toezicht geldtransactiebedrijven),  National Ordinance on the Supervision of Investment Institutions and Administrators (Landsverordening regelende het toezicht op beleggingsinstellingen en administrateurs), respectively the National Ordinance on the Supervision of Trust Service Providers (Landsverordening toezicht trustwezen), National Ordinance on the Supervision of Securities Exchanges (Landsverordening toezicht effectenbeurzen), National Ordinance on Foreign Exchange Transactions (Landsverordening houdende regels betreffende het deviezenverkeer) Furthermore, the Central Bank monitors compliance by the credit institutions with regulations on the detection and deterrence of money laundering and terrorist financing (AML/CFT regulations, including the FATF recommendations) and regulations on the disclosure of information to the public.

EMPLOYMENT

An employment agreement is an agreement pursuant to which a (natural) person, the employee, commits to perform work personally for and under the authority of the employer, during a certain period of time, for which the employee receives a salary.

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Employer/employee relations

Employer/employee relations in Curaçao are governed by:

  1. The Civil Code;

  2. Separate labor laws;

  3. Case law; and

  4. Individual and/or collective employment agreements.

 

Preferred employees

In general the government of Curaçao has a policy that residents of Curaçao who have the Dutch nationality and the required skills and qualifications for an open position in Curaçao should be preferred for the position over a non-resident.

 

Hiring requirements

Foreign nationals require a (temporary) residency permit as well as a work permit to be able to legally reside and work in Curaçao. These permits are obtained by filing an application with the governmental department in question. The length of this procedure varies and in general takes several months. As long as the work permit has not been granted, the foreign national may not perform any work for the local employer.

 

Employment agreement

There are no requirements as to the form of an employment agreement. The employment agreement can be made in writing or verbally. However, for certain provisions (e.g. a trial period and/or penalty clauses), the written form is mandatory. The employment agreement can, in principle, be entered into for a defined period of time or for an indefinite period.

 

Trial period

During a trial period both the employer and the employee have the right to terminate the employment agreement immediately without giving a reason and without taking into account any notice period.

This trial period must be agreed to in writing and may not exceed two months; any stipulation to the contrary renders the entire trial period stipulation null and void.

 

Minimum wages

Every employee who is 21 years or older is entitled to at least the minimum wage per hour. As of 1 January 2015 the minimum wage per hour for an employee who is 21 years or older is ANG 8.20 (approximately USD 4.61).

 

Maximum working hours

Employees who earn less than a certain annual income fall under the scope of the Labor Regulation and may therefore not work more hours than the statutory maximum of working hours. The Labor Regulation makes a distinction between schedule workers and non-schedule workers. Schedule workers are employees who work in accordance with a recurrent schedule (timetable) outside of regular office hours.

 

For non-schedule workers the maximum working hours per week calculated over a four weeks’ period is forty hours, provided the employee does not work more than ten hours a day. The period during which the employee has to work longer than six hours each day has to be interrupted after at the most five hours for a break of at least half an hour.

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For schedule workers the maximum working hours calculated over a four weeks’ period is forty-five hours per week, provided the employee does not work more than ten hours a day. Any working hours beyond the above mentioned maximum hours per day and per week is deemed overtime.

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An employee is, amongst others, entitled to overtime payment if the employee works during his break or if the employee works longer than the maximum working hours.

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Employer and employee may agree in writing that instead of paying out the overtime in money, the overtime shall be compensated completely or partially in days off (time-back).

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Non-compliance with the Labor Regulation can result in imprisonment (for a maximum period of four years) or a fine (for a maximum of ANG 100,000), depending on which provision(s) has/have not been complied with.

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VACATION, SICK LEAVE AND OTHER PERMITTED LEAVE

 

Vacation

The minimum number of vacation days an employee is entitled to is regulated for all employees. Every employee is entitled to an amount of vacation days per year equal to at least three times the contracted number of working days per week, with a minimum of fifteen days per year for employees who work six days per week. During an employee’s vacation, the employee remains entitled to receive his salary. Vacation allowance, however, is not mandatory. Furthermore, during (official) national holidays the employee also remains entitled to receive his salary.

 

Sick leave 

In the event an employee is unable to perform his/her labor due to sickness (that is not intentionally caused by the employee), the employer is obligated to continue payment of (100% of) the employee’s salary during a relative short period of time (unless otherwise stipulated in the labor agreement).

 

Pregnancy- and maternity leave  

An employee is entitled to payment of 100% of her salary when she is on pregnancy- and maternity leave. The pregnancy leave can be two to six weeks before the estimated due date and the maternity leave can be eight to twelve weeks as of the date the employee gave birth. The total amount of time on leave (pregnancy leave and maternity leave combined) must in all events be at least fourteen weeks.

 

Other leave

For other situations (such as weddings, funerals, delivery of children (fathers) and personal leave) there is no legal stipulation granting the employee a specific amount of time for permitted leave. However, (unless agreed otherwise) an employee remains entitled to its wages for a fair short period of time, in the event the employee was not able to work during such time due to (i) the fulfillment of an obligation imposed by law or by the government which could not be fulfilled in the employee’s free time or due to (ii) special circumstances not caused by the employee’s fault.

 

TERMINATION OF EMPLOYEMENT AGREEMENT

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For termination of employment agreements pursuant to Curaçao law, the mandatory rules and regulations regarding termination of employment agreements have to be taken into account.

Generally, there are four ways to terminate an employment agreement in Curaçao:

  1. Termination by giving notice, in which event the prior approval from the Director of the Ministry of Social Development, Labor and Welfare (Ministerie van Sociale Ontwikkeling, Arbeid en Welzijn) has to be obtained pursuant to the National Ordinance Termination Employment Agreements (Landsverordening Beëindiging Arbeidsovereenkomst). Without such prior consent, a termination by giving notice will be considered null and void, unless, the National Ordinance Termination Employment Agreements is not applicable to a certain labor relationship.  The National Ordinance Termination Employment Agreements is for example not applicable to teaching and lecturing personnel who work at a educational institution.

  2. Termination by mutual consent. Termination by mutual consent is possible at any time, in which event the employer and the employee can freely negotiate the terms and conditions for the termination of the employment agreement.

  3. Dissolution of the employment agreement by the Court of First Instance of Curaçao.

  4. Immediate termination of the employment agreement, which is only allowed if there is an urgent reason, justifying an immediate termination. Such urgent reason and the immediate termination would have to be communicated  to the employee ‘forthwith’.

 

In event of termination by giving notice after obtaining the required approval or in event of dissolution of the employment agreement by the Court of First Instance, it is possible that it is decided that a (termination) compensation will have to be granted to the employee.

For completeness sake it is pointed out that employment agreements that have been entered into for a defined period of time, terminate by operation of law upon the expiration of the period of time for which they have been entered into (unless otherwise agreed).

 

Notice period

When an employment agreement is terminated by giving notice, a notice period must be taken into account. The notice period is related to the years of service of the employee at the time of termination. The mandatory notice periods that must be taken into account by the employer are as follows:

  • In case of an employment of less than five years: one month;

  • In case the employee has been employed more than five but less than ten years: two months;

  • In case the employment has lasted longer than ten years but less than fifteen years: three months;

  • In case the employment has lasted more than fifteen years: four months.

The notice period to be taken into account by an employer may be extended, only if the extended notice period has been agreed to by parties in writing (shortening the notice period to be taken into by the employer can only take place in a collective employment agreement).

From the notice period the waiting period to obtain the required approval from the Director of the Ministry of Social Development, Labor and Welfare may be subtracted, provided that the remaining notice period will be at least one month.

CESSANTIA

The employee whose employment agreement is terminated without fault on his part or for a reason that cannot be attributed to him is entitled to a onetime monetary compensation known as the ‘cessantia’ (provided the employee has been employed for at least one year). This cessantia payment is regulated in the Cessantia Ordinance (Landsverordening Cessantia) and is calculated based on the years of service. The employee must claim his cessantia pay within one year after termination of the employment agreement.

For employees who will become entitled to a pension or general old age pension after termination of their employment agreement, they will only become entitled to cessantia, provided that (i) the pension is not less than the old age pension and (ii) if the old age pension, when deducted from the pension, is not less than twice the amount of the old age pension applicable at that time.

 

SAFETY STANDARDS

Besides the Civil Code of Curaçao that prescribes that the employer has the obligation to do all that is necessary to ensure the safety of its employees, the Safety Ordinance (Veiligheidslandsverordening) also contains specific safety regulations that need to be complied with.

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An employer is obligated to provide for a safe working environment for the employee, so that the employee is protected against harm, as much as can reasonably be expected taking into account the work to be performed by the employee. In the event an employer does not take such measures and the employee has an accident during working hours, the employer is in principle liable for the damages suffered by the employee, unless the employer can prove that due to circumstances beyond his control the measures were not taken, or that the damages suffered by the employee can mainly be attributed to the employee’s own grave fault. The employer is furthermore not liable in the event of intent or conscious negligence on the part of the employee.

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UNIONS

Employees have the right to join labor unions. The employer is obliged to recognize a union when negotiating a collective labor agreement, if the outcome of a referendum set up by the governmental institution ‘landsbemiddelaar‘, shows that the majority of the employees of that employer wish that union to represent them in connection with their labor affairs.

In the event that twenty-five or more employees are involved in a labor conflict and this conflict can lead to labor unrest, the employees and/or the employer in question are obliged to call in assistance of the landsbemiddelaar. In the event that there are less than twenty-five employees involved in a labor conflict, it is not obliged to request assistance of the landsbemiddelaar, nonetheless  can its assistance be requested by the concerned parties.

 

IMMIGRATION REQUIREMENTS

The National Ordinance on Admission and Expulsion (Landsverordening Toelating en Uitzetting, LTU) addresses the terms and conditions of admission to Curaçao. The LTU applies to foreign nationals and is not applicable to:

  • Persons having  Dutch nationality, born in Curaçao;

  • Persons having Dutch nationality, born before 1 January 1986 on the island Aruba and residing on mentioned date in the Netherlands Antilles and subsequently residing in Curaçao on 10 October 2010;

  • Persons having Dutch nationality, born on Bonaire, Saba, St. Eustatius (Statia), or St. Maarten and residing in Curaçao on 10 October 2010; and

  • Children of the above mentioned Dutch nationals.

 

As a general rule, all foreign nationals are obliged to apply for a residence permit, unless a person has admission by right (toelating van rechtswege, see Dutch citizens) or qualifies as a tourist (see Tourists & visas). In all other cases foreign nationals are obliged to apply for a (temporary) residence permit (see Foreign nationals).

Legal regulation with regard to immigration to Curaçao makes a distinction between immigration by Dutch citizens and immigration by foreign nationals.

More about employment law in Curaçao.

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DUTCH CITIZENS

Legal regulation pertaining to immigration by Dutch citizens is rather flexible. Dutch citizens can apply for admission by right (toelating van rechtswege).

Dutch citizens may reside in Curaçao as a tourist for six months. During this period it is allowed to look for a job and make enquiries with regard to envisaged residence in Curaçao. It is prohibited to work or to do an internship during a tourist stay.

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From the moment a Dutch citizen is going to work in Curaçao or wants to extend his stay, an application for admission by right must be filed. Contrary to other Foreign nationals, Dutch citizens may be present in Curaçao when filing the application for admission by right. After filing the application and pending the application process for admission by right,  Dutch citizens may be present at the workplace as well.

The application process for admission by right has to be handled within a reasonable term. The authorities are under the obligation to decide within four months in order to comply with the reasonable period.

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Dutch nationals applying for admission by right are granted admission to Curaçao for an indefinite period of time as long as they fulfil certain requirements. Depending on the purpose of the residence, admission by right may be granted for a certain period.

Admission by right ends in case the  Dutch citizen relocates abroad for more than one year. As a result a new application for admission by right has to be filed.

Please note that admission by right does not implicate a right to doing business. With regard to the incorporation of a new business additional licenses may be required, e.g. a business license or a director’s license, and certain restrictions may be applicable depending on the nature of business or duration of the residence in Curaçao.

 

TOURISTS & VISAS

A tourist is legally defined  as someone who resides within Curaçao for no longer than three months for purposes of relaxation, sports, health reasons, family matters, family visit, study, religious purposes or business purposes and provided that no work is being performed during the stay for which payment is being received.

Tourists do not have to apply for a temporary residence permit or for admission by right in order to reside in Curaçao. The allowed maximum length of the tourist stay depends on the tourist’s country of origin:

  • Tourists having Dutch nationality may enter Curaçao for a period of six months;

  • Tourists originating from the European Union, the United States, Canada, Australia, New Zealand and Japan may stay for three months;

  • Tourist having other nationalities may enter Curaçao for a maximum period of thirty days unless the return ticket provides for a shorter term. In case such tourist wishes to lengthen the tourist stay, an application for prolongation must be filed at the Immigration Department (Vreemdelingendienst).

Please note that certain nationalities require a visa, in which case the length of the tourist stay depends on the validity period of the visa. Please note that during the stay as a tourist work is prohibited.

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SHIPPING

The Dutch Caribbean has always played a significant role in international trade. The islands’ favorable geographic locations and reliable services in the ports attract a large number of vessels annually. The cruise tourism and presence of the oil refinery and ship repair yard in Curaçao account for a steady number of vessels each year.

The activities in the Dutch Caribbean ports include container transshipments, ship repairs, bunkering, cruise tourism and marine (underwater) surveys. As a result of the flexible fiscal regime, reliable legal infrastructure and the presence of specialized service providers, Curaçao is an attractive option for registration of vessels.

Curaçao’s jurisdiction has great conditions for arrests and judicial sales of vessels, through public auction or private sale. Claims (foreign or local) can be enforced very prompt and cost efficient, while the claimant is in control over the whole process. Almost all costs incurred with the enforcement can be recovered from the sales proceeds. As a consequence of judicial sale in Curaçao, the vessel will be freed from old claims so that the buyer of the vessel can easily re-register its vessel with a clean title.

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THE PROCESS OF ARREST

A conservatory arrest, being an arrest before an enforceable title such as a judgment is obtained, can be effected after leave from the local Court. To obtain leave to arrest a vessel, a written application must be submitted to the Court on behalf of the claimant setting out any relevant information concerning the claim. At the time an arrest application is filed, the claimant is only required to assert his claim in writing. It is however recommended to produce documents or other evidence in support of the claim. Furthermore, a claimant is not required to demonstrate that the ship owner is of doubtful solvency. It is common practice to request leave to arrest the ship for the principal amount increased by 30% (concerning a principal amount up to approximately ANG 600,000, 20% on the excess up to approximately ANG 1,200,000, 15% on the excess up to approximately ANG 10,000,000) approximately ANG 600,000; and 10% on the excess over ANG 10,000,000) to secure any interest which accrues on the claim and costs and expenses of the proceedings.

 

After leave for arrest has been obtained, the petition together with the leave of the Court must be handed over to a court appointed bailiff, who will affect the arrest on the ship by serving a writ of arrest upon the ship. The whole process from court application to actual arrest can usually be effected within two business days. If parties reach a settlement and the arrest should be lifted, it can usually be done in a couple of hours.

 

JUDICIAL SALE: ENFORCEABLE DOCUMENT & TITLE

In order to be able to arrange for a judicial sale, a claimant must have an enforceable document, allowing such sale. The various documents, which allow a claimant to sell a vessel by judicial sale, are:

  1. a judgment by which an order for payment of a certain amount has been rendered by (a) one of the Courts of the Kingdom of the Netherlands (b) a foreign Court which can directly be enforced in Curaçao pursuant to a treaty;

  2. an official excerpt of a notarial (mortgage) deed issued by a civil law notary officiating in the Kingdom of the Netherlands;

  3. a (mortgage) deed issued by a foreign notary, which can be enforced in Curaçao, based on a treaty or exequatur;

  4. an arbitral award or a foreign arbitral award which can be enforced in Curaçao.

In case none of the above apply, the creditor can obtain a title, enabling a judicial sale, from the local Court through (summary or exequatur) proceedings after the vessel has been arrested.

 

JUDICIAL SALE: REQUESTING AN AUCTION

The creditor will have to file a request with the local Court in order to establish a date and time for judicial sale, through public auction of the vessel. In its request the creditor has to illustrate (and provide evidence) that it is entitled to foreclose upon the vessel.

Subsequently, the enforcing creditor will have to deposit with the Court:

  • the Conditions for Sale;

  • a declaration from a bailiff or creditor’s attorney that the advertisements of sale and notifications of other creditors and claimants have taken place; and

  • a list of parties which are known to the enforcing creditor and who qualify as a title holder and/or judgment creditor in respect of the vessel. There is no obligation to inform other known creditors of the sale unless they fall within one of the above categories.

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When filing its request, the enforcing creditor will have to take into account a period of 30 days between the date on which the abovementioned documents are deposited with the Court and the date of the auction. However, this period can be shortened, under special circumstances, which may be subject to certain conditions imposed by the Court.

Following (the submission of) this request, the Court will normally ask for a court hearing to discuss the main features of the auction. Following this hearing, the Court will render a judgment in which it establishes a time and date for the auction as well as the terms and conditions for organizing the auction (e.g. date on or before which the advertisements will have to be placed, date on or before which the auction conditions will have to be submitted, date on which the list of known title holders and judgment creditors will have to be submitted etc.).

 

JUDICIAL SALE: CONDITIONS FOR SALE

The sale has to be advertised in a local paper of general circulation and a paper of vessel’s flag state, 30 days prior to the sale of the vessel (please be advised that this period can be shortened, under special circumstances, which may be subject to certain conditions imposed by the Court). In addition, the judge may also stipulate that an advertisement has to be placed in another international newspaper such as Lloyds List.

The sale is furthermore to be made public by the posting of notices of sale in the manner customary at the place where the sale is to take place (to be carried out by a bailiff). Notices of sale are normally posted on the vessel, the premises where the vessel is berthed and the Court. The notices of sale must comply with the same requirements as the advertisements and therefore usually the text of the advertisement is used.

The Conditions of Sale for the auction have to be drawn up by the enforcing creditor.

The price to be paid for the vessel consists of the amount of the highest bid made at auction, increased by the costs of the sale proceedings (i.e. legal costs, court and bailiff fees). A statement of these costs has to be put up no later than three days prior to the judicial sale.

 

POST-AUCTION PHASE

After the vessel has been auctioned, the proceeds must be divided according to the priorities of the claims that have been presented by creditors. In general our  local law is applicable to determine the rank of a claim. However, whether a claim validly exists and the priority of a claim, is determined by the law governing the claim. Consequently, no priority is attributed to a claim which, under the law applicable to the claim, has no priority on the vessel.

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The judicial sale of a vessel is definite. It is not possible to appeal the awarding of the vessel to the successful bidder/buyer at auction. The purchase price of the vessel will normally be payable within eight days from the auction. Once the purchase price and the costs of execution, listed in the statement of costs, have been paid by the purchaser, the vessel is delivered free and clear of all previous liens, encum¬brances and mortgages to the buyer.

 

COURT APPROVED PRIVATE SALE

Besides the auction, local law also offers the possibility to opt for a Court-approved private sale up to seven days before the scheduled auction date. The effect is the same as with an auction: the vessel is delivered to the purchaser free of pre-existing liens and encumbrances. A judicial auction can be applied for and held concurrently with behind the scenes negotiations for a private sale.

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TAX

Curaçao is part of the Kingdom of the Netherlands. The Kingdom has a Tax Regulations for the Kingdom (Belastingregeling voor het Koninkrijk or BKR). The main purpose of the BKR is to avoid double taxation within the Kingdom. Additionally Curaçao is party to the treaty between the Kingdom of the Netherlands and the United States of America concerning the exchange of data with regard to taxation.

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Furthermore Curaçao has adopted the entire tax system as it applied in the former Netherlands Antilles. The system consist of taxes on corporations and taxes on individuals. For Curaçao tax purposes, corporations are classified as either resident or non-resident. The important Curaçao taxes on corporations are the income tax (inkomstenbelasting), profits tax (winstbelasting) and dividend tax (dividendbelasting).

 

One of the taxes on individuals is payroll tax (loonbelasting).

The recent National Decree Tax Measures 2019 (the “Decree”) includes several changes in tax regulations for Curacao. When deciding to do or start a business in or from Curacao, it is important to engage a local tax adviser that has knowledge of the current tax treatment and laws.

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The sales tax (omzetbelasting or OB) is levied on the delivery of goods and all services rendered ‘within the territory’ by resident or non-resident entrepreneurs within the scope of their business. Aforementioned Decree may result in replacing the OB by an Algemene Bestedingsbelasting or ABB

From non-resident guests staying at any form of accommodation against payment a room tax (logeergastenbelasting) is levied. Gasoline, cigarettes, beer, wine, alcoholic spirits are subject to an excise duty. A transfer tax (overdrachtsbelasting) is levied on the transfer of real estate. Furthermore there is a Real Estate Property tax (onroerendezaakbelasting).

 

This annual tax is levied on the value of the real estate and charged to the owner of the property. A person who inherits money or property on the estate of a person who has died has to pay inheritance tax (successiebelasting).

Curaçao also has a social security system. The social security taxes are known as AOV, for old-age pension, and AWW, for widows and orphans. There is a contribution for both employers and employees.

 

E-ZONE

An e-zone is an area designated for international trade. Curaçao has several economic zones (e-zones) where goods can be stored, packaged and traded. For companies with cargo traffic there are two e-zones available: one at the airport and one at the harbor.

 

The profit of the e-zone companies will be taxed at 2%. Conducting business with other companies located in an e-zone is allowed. If business is also conducted with companies located on Curaçao, the company will have to request approval from the Department of Economic Affairs.

 

The turnover generated through local business may not exceed 25% of the total turnover. Goods which leave an E-zone to be imported into Curaçao or goods which are transferred from an E-zone to a warehouse are subject to 9% sales tax. Only legal entities with capital divided into shares (the limited liability company and the private limited liability company) with actual presence in Curaçao may perform activities within an e-zone.

 

The activities of these companies must in principle be focused on trading or providing services to companies located outside of Curaçao.

VANEPS is not a tax advisory firm. The information contained on this page provided general guidance for companies only. It should not be used as a substitute for consultation a tax lawyer.

IAMI Intermediary & Investment

Azucena Maduro

©2025 by IAMI Intermediary & Investment. 

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