Legal Blog

Monday, February 11, 2013

Taking over control of a Curacao company through a foreign court decision

The powers of a foreign appointee will not be recognized. According to Curacao private international law, the appointment and dismissal of board members of a company as well as decisions limiting their powers is governed by the laws of the jurisdiction under which the company is incorporated. Accordingly, the appointment and dismissal of a board member of a Curacao limited liability company (NV or BV) as well as any limitation in respect of his powers must take place in accordance with Curacao law.

In the event a Curacao company has a foreign branch, e.g. in the United States, such company may be faced with a foreign, i.e. US, court order or decision by virtue of which a person is appointed, for instance as fiscal agent or receiver, empowered to direct the affairs of the company and act on its behalf, thus with the powers to effectively take over the control of the company. In most cases Curacao law does not recognize the concept of ‘receiver’ or ‘fiscal agent’ in a meaning comparable with the meaning used in the foreign court order or decision.

Unless the articles of association provide otherwise, for instance that board members be appointed by the board of supervisory directors, under Curacao law the appointment of board member requires a shareholders’ decision. In the absence of an enforcement treaty, or in case an order or judgment does not fall within its scope, the foreign court order or decision has no direct effects in the Curacao. In other words: the foreign receiver or fiscal agent will not be recognized as the person in control of the company because Curacao corporate law does not provide for such measures.

Filed under: Corporate by Karel Frielink.



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