In dit hoofdstuk :
Limitations to authority
Recording information in the trade register
In many cases a limitation only applies with regard to dealings with outsiders (third parties) if this is recorded in the trade register. This is called 'third party protection'. For some authorized signatories, such as those with simple power of attorney, a record in the trade register is not compulsory, but wise nonetheless: it can avoid any confusion. It can also simplify the arguments put forward in any later court case.
Limitations in respect of a VOF or CV
The authorization to sign contracts by managing partners in a general partnership (VOF) or a limited partnership (CV) may be restricted. If these limitations are recorded in the trade register, then all persons outside the partnership (third parties) are deemed to have knowledge of them. In any event, authorization to sign should not be confused with liability. If, for example, a partner is authorized to sign transactions independently on behalf of the partnership to a value of 5,000 EUR, this does not mean that his liability is limited to that amount. Such a managing partner, just like all other managing partners, is responsible for all debts incurred by the VOF.
Limitations in respect of a BV or NV
In the case of a BV or NV the director, that is to say the directors collectively, are always authorized to act on behalf of the company. In principle, an individual director has the same authority, although there can be a limit to his authority. A sole director may not be authorized to act on his own, for example, but only if a transaction he signs for is countersigned by another director.
This is the only limitation which the law permits. A limitation on authorization to sign up to a limit of 5,000 EUR, for example, does not legally bind any third party: in such a case the individual director is simply authorized to sign independently. However, directors must render themselves accountable within the BV if they exceed their authority and, for example, sign a contract on behalf of the BV for more than 5,000 EUR. However, no third party needs to be concerned about this.
Limitations in respect of an association, foundation, co-operative and mutual insurance society
A number of rules apply to an association, foundation, co-operative and mutual insurance society which are the same as those applicable to a BV:
- The board of directors as a whole acts on behalf of the legal entity.
- Each individual director may independently be an authorized signatory providing that articles allow for this.
- The only limitation on the authority of a director which the law permits is that a second person must countersign alongside his signature. Other limitations, such as an authorization up to a certain sum or restrictions as to type of transaction, have no effect outside the legal entity and therefore third parties do not need to concern themselves with any of these. These are a purely internal matter.
An example: the treasurer of an association
This situation frequently arises in the case of associations: the treasurer must be able to independently access the credit balance of the association's bank account. However, it is not desired that the treasurer can bind the association in other matters whilst acting independently. Consequently, the treasurer can best be recorded in the trade register as follows: as a board member the treasurer has joint authority with the rest of the board members. Additionally, a power of attorney is granted to him/her to conduct transactions concerning the bank account independently and alone.
Limitations upon a power of attorney
Someone with power of attorney (or a representative) may be granted full authority. This means that he may represent the company in all matters, including lodging documents such as amendments to the trade register. This authority may also be limited to certain activities or to a sum of money per transaction. All kinds of limitations are possible. Limitations can always be used as arguments against any third party, providing that that limitation was 'known' to the third party. If the power of attorney is recorded in the trade register, then it is deemed to be made public: no third party can then claim lack of knowledge.
Powers of attorney which must be compulsorily registered
The following powers of attorney must be registered in the trade register:
- Commercial agents with powers of attorney who are active in the Netherlands.
- Powers of attorney which have been granted in accordance with the articles of a legal entity.
Not all powers of attorney must be registered. Some powers of attorney may be registered, but do not have to be. Often registration is to be recommended, so that it is then clear to everyone what the different legal relationships are. Should someone claim in dealings with you to have a power of attorney, and the trade register cannot confirm this fact, then it is sensible to contact the company or legal entity itself for confirmation.
