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February 27, 2024

Residency in the Netherlands based on the Dutch American Friendship Treaty

Hermie de Voer

American citizens who want to obtain residency in The Netherlands can do so based on the Treaty of Friendship, Commerce and Navigation between the Kingdom of the Netherlands and the United States of America and its protocol signed in The Hague on 27 March 1956. This Treaty is referred to as the Dutch American Friendship Treaty also known as DAFT. It gives American entrepreneurs and their family members residency rights and the right to work as an entrepreneur in the Netherlands. Article II of the DAFT reads as follows:

Nationals of either Party shall be permitted to enter the territories of the other party and to remain therein: (a) for the purpose of carrying on trade between the territories of the two Parties and engaging in related commercial activities; (b) for the purpose of developing and directing the operations of an enterprise in which they have invested, or in which they are actively in the process of investing, a substantial amount of capital; and (c) for other purposes subject to the laws relating to the entry and sojourn of aliens.

Based on the Protocol, article 1, family members can join the American entrepreneur:

The spouse and unmarried minor children of a person permitted entry under the provisions of Article II, paragraph 1 (a) and (b), shall also be permitted entry of accompanying him or following to join him.

The requirements and conditions that need to be met are relatively easy to fulfill, especially when compared to the general entrepreneurial scheme in The Netherlands that consists of a scoring system in which the entrepreneur needs to prove their added value to the Dutch economy and its innovation skills. To obtain enough points under this scoring system there are three criteria: education and work and experience, business plan and financial prognoses and innovativeness of the business. The evaluation of each of those criteria is done by the Dutch Enterprise Agency. It is generally very difficult to score enough points overall on each of those criteria and therefore to obtain a residence permit for self-employment.

Under the DAFT, however, an American citizen can apply and obtain a residence permit for an initial two years when a sole proprietorship or LLC is set up and a minimum of €4500 of own capital is invested in that company.

The spouse and minor children of the U.S. entrepreneur can obtain residency as well. Whereas the American entrepreneur is only allowed to work for his own company, being self-employed, their spouse is free on the labor market. This means that the spouse of the American entrepreneur can accept any job and/or start their own company without needing work authorization. The spouse and children do not have to have American citizenship if the entrepreneur who applies for the self-employment permit under the DAFT has US citizenship.

The income requirement for the initial two years residency as an entrepreneur under the DAFT is met when an investment of €4500 of own capital be shown on a Dutch business bank account that is linked to the Dutch company. When the residence permit comes up for renewal the American entrepreneur needs to show the Dutch immigration authorities, IND, that they have been working and that they have been earning money from assignments from different clients. There is no minimum income requirement. A profit and loss account and the income taxes that have been paid in those two years can be submitted as proof that this income requirement is met. The entrepreneur and his family do need to have sufficient means to support their family financially as it is not allowed to be depending on social welfare. On top of that, health insurance in the Netherlands needs to cover the whole family. When these requirements are met, the residence permits under the DAFT will be extended for five years.

The DAFT does not only apply to American citizens. It also applies to Japanese and to Bolivian citizens. Article XIV, paragraph 5 of the DAFT states:

Nationals and companies of either Party shall be accorded national treatment and most-favored-national treatment by the other Party with respect to all matters relating to importation and exportation.

This is the basis of the equal treatment of Japanese and Bolivian citizens. The Treaty of Commerce and Navigation between the Kingdom of the Netherlands and Japan signed in The Hague entered into force on 9 October 1913. It enables Japanese citizens and their families to obtain residency and work authorization in the Netherlands.

Similarly, Bolivian nationals who open their own company in the Netherlands (and their families) can make use of the same rules and regulations based on the Trade Treaty between the Kingdom of the Netherlands and the Republic of Bolivia that was signed on 30 May 1929 in La Paz.

Therefore, given the relative ease of residency offered by the Netherlands under the Treaty of Friendship, Commerce and Navigation, American entrepreneurs seeking new business opportunities abroad may want to explore life in the Netherlands.

    Hermie de Voer

    Everaert Advocaten Immigration Lawyers

    Hermie de Voer is a partner at Everaert Advocaten Immigration Lawyers in the Netherlands. She can be reached by email at [email protected] and by telephone at + 31 (0) 20 752 32 22.

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