15+ Pros and Cons of Doing Business in the Netherlands

Business & Company 15+ Pros and Cons of Doing Business in the Netherlands

15+ Pros and Cons of Doing Business in the Netherlands

The Netherlands is a northwestern country in Europe, blessed with nature and resources. The country grabs a rank of 2nd position for agriculture exports. This makes the country a better location to start a business or to invest capital. The country successfully attracts a large number of business leaders and entrepreneurs.

If you are searching for a business site for expanding or starting your business, this article will help you make your decision. This article highlights some interesting aspects of doing business in the Netherlands.

Benefits of Doing Business in the Netherlands The Drawbacks of Doing Business in the Netherlands
Gender equality Enforcement of contracts 
Large and powerful populationStrict Business behavior

Advantages of Doing Business in the Netherlands

  • Geographic Location:

The Netherlands has a business-friendly location. It connects with the European market, and it also connects with the market of Germany, the United Kingdom, and France.

This grabs the attention of several international business players and foreign investors to invest in Switzerland. The Netherlands has good relations with its neighboring countries, which makes international trade more profitable.

  • Stable Economy:

The Netherland grabs a rank of 6th position among all the European countries for having a strong economy. This makes a large number of investors attracted to the country. The stable yet growing economic graph brings a lot of development to the country in terms of capital.

The GDP of the country is highly influential and makes up to 50% of the Dutch economy. This is a highly remarkable point to be considered while starting a business in the country.

  • High education:

The country has a unique education system and provides a highly-skilled workforce. The young graduates are responsible and have a proper amount of knowledge that brings development to the business company.

Many successful companies have originated from the country because of highly skilled labor availability and the application of proper strategies towards development. 

  • Technology:

The Netherlands has experienced a wave of technological advancement from the past few years at a very high rate.

There is the availability of vital internet service for 24×7. The telecommunications department, transportation department, health department are all highly advanced with the help of technology. 

  • Multiple Booming Sector:

There are various booming sectors in the economy, such as the pharmaceutical industry, electrical machinery manufacturers, and petroleum refineries that are booming due to remarkable technology.

Technology makes the country work at a rapid rate and also makes the time-consuming processes faster.

  • Tax Policies:

Tax policies in the country are business-friendly and grab the attention of numerous business leaders and investors. The corporate tax is 20% starting and then increases to 25% if the profit exceeds €200,000.

Moreover, foreign companies can establish an offshore company that has more tax relaxation. This attracts a high number of foreign investors and entrepreneurs to the Netherlands.

  • Signatories:

The Dutch government has signed double taxation treaties with more than 80 countries to avoid double tax payment while trading. This is highly remarkable and profitable for businesses to conduct foreign trade and expand their places at the international level.

  • Infrastructure:

The Netherlands has an excellent infrastructure. It has the largest port of Europe, known as the Port of Rotterdam, and the 6th largest cargo airport globally. This makes it easier for business owners to travel across the border and easily access nearby business locations.

Disadvantages of Doing Business in the Netherlands

  • Starting with business:

Starting with business in the Netherlands has relatively more straightforward processes, but many companies face problems with getting started. There are several procedures to be considered for the legalization of the company.

After investing a certain minimum amount of capital in the company, government departments take multiple inspections in the account. 

  • Physical Presence Required:

There is a physical presence requirement of business owners to get the legalization process completed. Moreover, a foreign company must get connected with the local business community and get their approval.

This causes a delay in starting with business and startups. It also leads to a delay in expanding business in the country.  

  • Construction Permit Pain:

The procedures for getting construction permits are very time-consuming in the country. It requires a total of 150 days to complete 14 types of different techniques to get construction permits. There are multiple inspections and visits to the construction site by various government authorities.

Moreover, there are many differences in obtaining construction permits in the country. There are requirements of soil quality approval, raw material approval, and more. This causes more delays in getting construction permits.

  • Electricity connection:

Getting an electricity connection is also time-consuming and requires approval from government departments. The external inspections are carried out by Linder company.

There is a need to sign contracts with an electricity supplier before getting an electric meter installed. The overall process takes 100 days, which causes a lot of delays to start the business..

  • Registration for Property:

It is another time and energy-consuming process. It is required to register the property with proper legal procedures.

The government department of property registration takes one or multiple inspections of the property. It takes plenty of time for the whole process to get completed, which brings hurdles in businesses’ development.

  • Payment of Taxes:

Taxes need to be paid in a stringent amount of time. There are nine types of different taxes that require up to 127 company hours to get completed. This makes it difficult for businesses to concentrate on development.

Many different types of government departments need to be visited in order to complete the payment process.

  • Trading across the border:

Trading across the border is relatively cheap, according to other countries. It takes up to 4 legal documents approved for both import and export. The process takes upto one week, which, however, causes a delay in supplying goods at a proper timeline.

  • Solving Insolvency:

It takes up to 1 year to get a satisfactory solution to insolvency. Moreover, if once stuck in insolvency whirl, it gets challenging to develop business after resolving the problem. The economic crisis affects the company a lot and takes plenty of time to recover.

  • Stringent Culture:

The Dutch culture is strictly followed in the country, and hence there is less approval of foreign business owners and investors by the country citizens in the country.

They require a lot of compelling information and logical evidence to change their traditional method of doing business. This makes it difficult for business owners and entrepreneurs to expand and develop their businesses.

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