DAFT (treaty)
Encyclopedia
The Dutch-American Friendship Treaty, also known as DAFT or Dutch American Residency Treaty, is an agreement between the United States
and the Netherlands
concerning friendship, commerce and navigation, together with a protocol and an exchange of notes relating thereto. It was signed at The Hague
on March 27, 1956.
One benefit of this treaty has enabled USA citizens to start businesses in the Netherlands and its territories.
Successful applicants receive a residence permit which allows them to work on a self-employed
basis, or to represent American companies with business interests in the Netherlands.
The treaty gives American citizens preferential treatment to operate a business in the Netherlands. In contrast to other non-EU nationals who want to work in the Netherlands on a self-employed basis, Americans applying under the treaty do not need to satisfy the points-based test which is applied to non-EU businesses.
In order to get a residence permit to operate a business under the Dutch American Friendship Treaty, the applicant must have the following:
The amount of capital required is determined on a case-by-case basis. The minimum amounts are determined by the legal form of the business:
The residence permit will be issued on a renewable basis for one year. On the back of the permit it will state that self-employment activities are only permitted in connection with the business plan. If the applicant wants to perform paid work for an employer, then a new application for a work permit
is required.
The residence permit will also be endorsed to say that the permit can be withdrawn if the applicant applies for public welfare benefits.
At renewal time, the IND will ask to see proof that the minimum required capital amount has been maintained without fail during the year.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
and the Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
concerning friendship, commerce and navigation, together with a protocol and an exchange of notes relating thereto. It was signed at The Hague
The Hague
The Hague is the capital city of the province of South Holland in the Netherlands. With a population of 500,000 inhabitants , it is the third largest city of the Netherlands, after Amsterdam and Rotterdam...
on March 27, 1956.
One benefit of this treaty has enabled USA citizens to start businesses in the Netherlands and its territories.
Successful applicants receive a residence permit which allows them to work on a self-employed
Self-employment
Self-employment is working for one's self.Self-employed people can also be referred to as a person who works for himself/herself instead of an employer, but drawing income from a trade or business that they operate personally....
basis, or to represent American companies with business interests in the Netherlands.
The treaty gives American citizens preferential treatment to operate a business in the Netherlands. In contrast to other non-EU nationals who want to work in the Netherlands on a self-employed basis, Americans applying under the treaty do not need to satisfy the points-based test which is applied to non-EU businesses.
In order to get a residence permit to operate a business under the Dutch American Friendship Treaty, the applicant must have the following:
- Registration of the business with the Chamber of Commerce;
- A business planBusiness planA business plan is a formal statement of a set of business goals, the reasons why they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals....
demonstrating commercial activities in the Netherlands; - A financial reportFinancial statementsA financial statement is a formal record of the financial activities of a business, person, or other entity. In British English—including United Kingdom company law—a financial statement is often referred to as an account, although the term financial statement is also used, particularly by...
, prepared by a qualified accountant or tax advisorTax advisorA tax advisor is a financial expert specially trained in tax law. Some countries require tax advisors to verify the balance sheets of companies above a certain size...
; - A valid passport valid for at least one year from the application date;
- Health Insurance;
- Substantial personal capital invested in the business. Borrowed funds are not considered.
The amount of capital required is determined on a case-by-case basis. The minimum amounts are determined by the legal form of the business:
- For an 'eenmanzaak' (a sole entrepreneur), the minimum amount of capital is €4,500.
- For incorporated businessesCorporationA corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...
, the amount is at least 25% of the minimum capital stockCapital (economics)In economics, capital, capital goods, or real capital refers to already-produced durable goods used in production of goods or services. The capital goods are not significantly consumed, though they may depreciate in the production process...
required by law (€45,000), or €11,250.
The residence permit will be issued on a renewable basis for one year. On the back of the permit it will state that self-employment activities are only permitted in connection with the business plan. If the applicant wants to perform paid work for an employer, then a new application for a work permit
Work permit
Work permit is a generic term for a legal authorization which allows a person to take employment.It is most often used in reference to instances where a person is given permission to work in a country where one does not hold citizenship, but is also used in reference to minors, who in some...
is required.
The residence permit will also be endorsed to say that the permit can be withdrawn if the applicant applies for public welfare benefits.
At renewal time, the IND will ask to see proof that the minimum required capital amount has been maintained without fail during the year.