Limited partnership (CV)

The commanditaire venootschap (CV), or limited partnership, is similar to a VOF (general partnership) except that there are two kinds of partners: a managing partner running the business on a day-to-day level, and a limited or silent partner in the form of a financial backer.

This is a good option for entrepreneurs who are short on capital and need a financial backer. It is also a way to grow an eenmanszaak or VOF. The investor becomes a partner in the business, providing not only financial support but also guidance on the company’s financial affairs.

The CV in a nutshell

• Establishment: Free, apart from small KvK fee and notary fee for partnership contract (see below)
• Capital required: None
• Governance: Managing partners & limited partners
• Liability: Private 100% for managing partners; limited liability for limited partners
• Social security: No sickness benefits or unemployment benefits
• Taxation for managing partners: BTW, income tax and payroll tax (if you have employees)
• Taxation for silent partners: Income tax
• Tax breaks: Yes if requirements are met

CV & liability

In the case of bankruptcy, the managing partner of a CV is personally liable for any debts. The limited partner is not held responsible for any debts, but they will lose their investment. It is important for silent partners to avoid acting as managing partner to the outside world, as this can affect their liability.

Setting up a CV business

A CV can be set up directly by the manging partner by registering it at the Dutch Chamber of Commerce. When registering a CV with the KvK, it is not necessary for limited partners to provide personal details, the number of silent partners and the amount of capital they contribute is sufficient.

The CV contract

There is no legal requirement to sign a partnership contract when setting up a CV. However a contract is strongly advised to avoid misunderstandings between partners. The partnership contract can be either created independently or via a notary and usually sets out:

• Who are the managing partners
• Who are the limited/silent partners
• What each partner brings to the company (labour, capital, and so on)
• How profits and losses will be distributed
• Termination conditions of the CV