Closing an inactive legal entity

When does KVK dissolve a legal person?

If a legal person ceases to exist, it must be dissolved (ontbinden) before it can be deregistered. KVK is obliged to dissolve a legal person if at least 2 of the following situations occur:

• No directors of the legal personality have been registered in the Business Register for at least 1 year. Either the registered (managing) directors are deceased or have been unreachable for at least 1 year.
• The legal entity has not disclosed any financial statements for at least 1 year. This does not apply to associations (vereningen) and foundations (stichtingen).
• The legal entity has not filed a corporate income tax return for at least 1 year after being reminded by the tax inspector. This does not apply to vereningen and stichtingen.
• The legal entity cannot be reached at the address listed in the Business Register and has not provided a new address.

With this rule, the Dutch government wants to ensure that the Business Register only lists active businesses and organisations. And that ‘empty’ legal persons do not fall into the wrong hands.

How are legal entities dissolved?

When the KVK determines that a legal entity has to be dissolved and closed, it will send a letter to the legal entity and its registered directors. The letter explains the reasons for dissolving the legal entity. These reasons are also called ‘grounds for dissolution’ (ontbindingsgrond). The letter tells you how to prevent KVK from dissolving the legal person. For example, by registering a (managing) director or providing the correct address. In addition, KVK announces the plan to dissolve the legal person in the Business Register and in some cases in the Government Gazette (in Dutch). You have 8 weeks to resolve the reasons for dissolving and closing the legal entity.

Order of Dissolution and publication

After those 8 weeks, is there still reason to dissolve? Then KVK dissolves the legal person through a ‘Order of Dissolution’ (ontbindingsbeschikking). KVK sends this decision to the legal person and the registered (managing) directors. KVK also publishes the decision in the Business Register (in Dutch) and in some cases in the Government Gazette (Staatscourant, in Dutch). This makes the deregistration of the legal person from the Business Register final.

Objecting to dissolution

Do you as an owner, (managing) director or other stakeholder, disagree with the decision? You can object in writing to KVK. You must do this within 6 weeks. KVK determines whether the objection is grounded and whether to reverse the dissolution. If the KVK decides that the objection is not grounded, you can also appeal this decision. You can send your appeal to the Trade and Industry Appeals Tribunal (College van Beroep voor het Bedrijfsleven, in Dutch) in the Hague.

Difference with deregistration

KVK can also deregister unincorporated legal structures from the Business Register if they are no longer active. These do not need to be dissolved first. Business structures without legal personality include the sole proprietorship, general partnerships (vof), CV, and professional partnership (maatschap). The process to deregister legal structures without legal personality is called deregistration.

How does deregistration by KVK work?

KVK checks whether businesses are active with data from the Business Register and information from the Netherlands Tax Administration. Is a business no longer active? Then the KVK sends a letter. You then have 4 weeks to inform the KVK that you are still active as an entrepreneur. If you do not respond, the KVK will deregister your company after these 4 weeks. Do you disagree with the KVK's decision to deregister your business? Then you can lodge a written objection with the KVK within 6 weeks.