Martín Verhoeff participates in the IR Global Guide – A Jurisdictional Guide to Opening a Foreign Bank Account

Foreward by Andrew Chilvers

For companies and individuals looking to move into new jurisdictions for business opportunities, setting up a bank account is a crucial part of the process. But this is never as straightforward as it seems.

In all countries, banks are obliged to crack down on fraud and any potential financial scullduggery. As a result, they tend to be very risk averse. Regardless of where a business establishes an office in the world, local banks will generally have the newly arrived expatriates jumping through various hoops, pulling their hair out in frustration.

The new arrival will need the relevant paperwork, including personal identity papers, a personal and business address, personal references and other numerous documents. And that’s just the beginning.

Every jurisdiction has its own banks and banking rules, which are often complex and bureaucratic. Consequently, seeking advice from local legal and financial experts before setting up a bank account is imperative if a company is it get the right account for its particular business objectives. This is why it’s so important to use local advisers who are experts in the jurisdiction to provide information about the local banking rules.

What is the general risk appetite of banks in your jurisdiction and how does that affect setting up a new business bank account?

The Netherlands represents the ideal choice for setting up a foreign bank account. It is known for its moderate risk profile, great local infrastructure, and a stable political climate. Advantageously, Schiphol airport accommodates direct flights from all parts of the world, locating you directly in Amsterdam, or anywhere else in the Netherlands under 3 hours.

The main risk parameters that affect setting up a new business account in the Netherlands are among others:

• Minimum levels for capital ratios;

• Risk-adjusted return measures;

• Concentration limits for single counterparties;

• Concentration limits for countries and industry sectors;

• Liquidity ratios (Loan-to-Deposit ratio, LCR, and NSFR);

• Market risk ratios;

• Operational risk ratios.

How accommodating are banks in your jurisdiction for opening a business and personal bank account?

To open up a bank account in the Netherlands, your company will need to present or identify itself to the bank of your choosing until the Ultimate Parent Company and the Ultimate Beneficial Owners. Explaining the reasons for starting the activity in the Netherlands. This includes anticipation of the growth revenue, members of staff, cashflow, client descriptions, and the locations of clients and suppliers.

Furthermore, company policy on anti-corruption and money laundering is required.

Finally, there must be an indication of the type of products that the customer wants to purchase before the application is processed.

Know Your Customer (KYC) procedures are a critical function to assess customer risk and a legal requirement to comply with the Dutch Anti-Money Laundering (AML) laws. Dutch law does require financial service providers to identify the persons mentioned in this KYC documents checklist. In case you are unable to meet with the bank in the Netherlands, or at one of the local branches of the bank, to be identified in person, it is possible to delegate this identification to certain third parties.

Uniquely Zirkzee Group has several experienced service providers, like European Growth Advisors and European Growth Reverent, in their network that can consult and assist your company with these KYC procedures. Smoothing this process considerably. In this case, the bank still requires the aforementioned certified copies of the identification documents.

Know Your Customer (KYC) procedures are a critical function to assess customer risk and a legal requirement to comply with the Dutch Anti-Money Laundering (AML) laws. Uniquely, Zirkzee Group has several service providers like European Growth Advisors and European Growth Reverent in their network that can consult and assist your company with these KYC procedures.

Should you join an internationally reputable or established bank rather than a local bank?

We would recommend a Dutch bank that operates internationally. Zirkzee Group has excellent relations with Rabobank, ABN Amro, and ING. The greatest advantage of these banks is that they often have local branches where the identification of employees, Ultimate Beneficiary Owners, or board members can take place. This can save you a lot of time and money in the process of opening up a foreign bank account. Moreover, these banks can provide full communication in English, German, French in most cases or Dutch if you wish. If you do decide to take a trip to Europe for the identification process, we are always happy to assist you and show you around our beautiful country.

Contributing Advisors

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