Dutch American Friendship Treaty: a residence permit for American entrepreneurs
The Dutch American Friendship Treaty
On 27 March 1956, the United States of America and the Kingdom of the Netherlands signed a bilateral treaty, namely the Netherlands Friendship, Commerce, and Navigation Treaty (also known as the Dutch American Friendship Treat). Under this Treaty, an American citizen can acquire a Dutch residence permit for the purpose of entrepreneurship, provided that he/she invests a substantial amount in his/her Dutch business. Since the 1950s, the definition of ‘a substantial amount’ has not been changed. In today’s terms, the minimum required amount of investment is €4500 (approximately, US$4885).
Benefits of this residence permit
This residence permit is valid for an initial period of two years. After two years, the validity of the permit can be extended for a period of five years, provided that the entrepreneur can demonstrate that the equity of his/her company has never been lower than 4500 euros.
With this residence permit, the holder is allowed to live in the Netherlands and to conduct entrepreneurial activities. However, with this residence permit, the US entrepreneur can only work for his/her own business. During the first five years, the US entrepreneur cannot work as an employee for another Dutch company without a valid work permit.
In order to apply for the Dutch American Friendship Treaty residence permit, a US entrepreneur needs to set up a company in the Netherlands. The company can be either a limited liability company (eg. besloten venootschap in Dutch) or a sole proprietorship. Should you want to know more about the different business forms, please feel free to have a look at this article, in which we explain and compare the different forms of business associations and their risks.
After setting up the company, a corporate bank account should be opened, on which the US entrepreneur needs to deposit at least 4500 euros. Please be aware that the Dutch American Friendship Treaty is not suitable for US entrepreneurs who want to practice medicine (eg. dentistry) or conduct business in the sector of national security.
Partners and children
A US entrepreneur can bring his/her partner and minor children to the Netherlands. Both the partner and the minor children can acquire a family member permit. Partner can be either married or unmarried, and can be of different/same gender. Pursuant to Dutch Council of State case laws, unmarried partners do not need to prove that they are not married to anyone else in their home countries. As from 1 January 2021, partner and children of a US entrepreneur are allowed to work in the Netherlands without a work permit.
Access to Health Care
The entrepreneur and his/her family shall have full access to the Dutch health care system. After they get their residence permits, the US entrepreneur and his/her family members shall be able to purchase Dutch national health insurance (basisverzekering).
If you are interested in knowing more about the Dutch American Friendship Treaty permit, please do not hesitate to contact us. You can fill out the contact form. One of our experts will contact you shortly.
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