An online shop that turns out to be fake. Or a salesperson for a company - only they do not work there. Check your new business partner’s details in the Business Register before you sign an agreement, or make a large purchase. Use this checklist.
Business Register Checklist
1. Is my customer or supplier registered in the Business Register?
Check the Business Register. Look up the company name of your customer or supplier and see whether they are registered, under which registration number, and at which address. Are you entering into a written agreement? Make sure that the details in the agreement match those in the Business Register. Are the correct name and legal structure of your business partner stated in the contract? Also, check who is authorised to sign on behalf of the company. When you sign a contract, it is important to get your own details right as well as those of your business partner. This is sometimes overlooked, making it unclear who you are doing business with. You risk doing business with an untrustworthy partner - for instance, supplying goods that are never paid for.
Sometimes, a Business Register entry is marked 'in onderzoek' (under investigation). KVK uses this label when the correctness of certain details is doubtful, for example the business address. KVK will investigate and, if necessary, adjust the entry. During the course of the investigation, the entry remains unaltered. Pay attention when you see the label 'in onderzoek'. It means you cannot rely on the information being correct.
2. How do I know if my business partner is bankrupt?
Before you do business with someone, you want to make sure your business partner is not bankrupt. You do not want to supply goods or services to a company that cannot pay for them. You can use the Business Register to see if a company is bankrupt, or in suspension of payment. Suspension of payment means that the company is in financial trouble and that the district court has granted it a postponement in paying their debts. The Business Register also records when someone is in the process of debt restructuring. This may be the case if a company is not a legal entity, as a private limited (bv) is, but a sole proprietorship ('eenmanszaak'). An entrepreneur who is in the process of debt restructuring is also unable to pay their debts.
3. Who am I doing business with? Who is the owner and who is authorised to sign?
To find out who are the owners, partners, directors and/or authorised representatives of a business, order a Business Register extract. In the extract you will also find other current company data such as address, company activities, number of employees, and date of establishment. Check these details and know who you are doing business with.
Take a closer look
Check whether the product or service the company is offering you corresponds with the business activities registered in the Business Register. Be critical. The internet hosts many fake companies, trying to defraud their visitors. A holding company for instance, claiming to sell export products, but never delivering. Check other company details as well, like the address. A wholesaler with a wide range of products, established at a home address? There may be a fraudster at work. Also look up the company online, on the internet. What experiences do other buyers have?
4. What about my business partner's liability?
The legal structure of your business partner determines their liability. The legal structure is stated is on the Business Register extract. Legal structures without legal entity, that you can register directly in the Business Register, are personally liable. Sole proprietorships and general partnerships are examples of this. The owner or owners are 100% personally liable for business debts, with their private assets. The directors of legal structures that require the services of a notary to set up, like a bv, are not personally liable for debts. Unless there has been mismanagement on the part of a director. If this is the case, the director can be held personally liable for debts, with their private assets.
Being aware of your business partner's liability is important. In case of a bankruptcy, for example, the legal structure can increase or decrease your chances of being paid, if you are a creditor. If your business partner is the owner of a sole proprietorship, you can lay claim to their private assets. But if you are dealing with the director of a dormant or shell bv (in Dutch: een lege bv), the chances of ever seeing your money if the company goes bankrupt are slim. A shell company is no longer in use, and does not have any assets or debts.
It is also important to know who is liable in case of damages. What if you hire a construction company to renovate your business premises, and a malfunction causes a crane to topple headfirst through your office facade? You need to know if you can claim damages, and how.
5. Which historical data of my customer can I find in the Business Register?
KVK has information about:
- the changes in the main data of the entire company (both headquarters and any branch offices);
- the signatory authority of officers (such as owners, directors, and proxies) at any given time;
- all former addresses, trade names, officers, business structures and business descriptions;
- a possible bankruptcy of your customer in the past.
You can order this corporate history. It may be relevant to have this information: for instance, if you signed an agreement with a company in the past, and it is unclear who was authorised to sign at that time. Say, you signed a contract with a company for 5 years . After 2 years, the company is taken over by a new owner, who wants to end the contract. The company claims that the contract was signed by an employee who has been fired since, who was not authorised to sign. Corporate history allows you to check this claim, and see if the company really is allowed to end the contract.
6. How is my business partner doing financially?
Companies with certain business structures are required by law to file their annual accounts with KVK. Annual accounts provide insight into the financial development, solvency and financial position of a company. If your business partner has filed their annual accounts, you can order them. Make sure your business partner has the funds to pay your invoices.
You can also order an overview of the documents that a legal entity has deposited with KVK, to see if they have met their filing obligations.
7. What is the group structure of my partner's business concern?
A business concern consists of a parent company and several subsidiaries, or daughter companies. Another way to phrase it: a holding with a number of operating companies. This can make it difficult to know exactly which part of the company you are doing business with. Avoid misunderstandings, and find out what the group structure of the business concern is. You can order a group structure overview at KVK. This gives you an insight into the structure of the business your partner belongs to, and states clearly which is the parent company.
8. UBO: who are the ultimate beneficial owners of my customer or business partner?
Ultimate Beneficial Owners (UBOs) are the ultimate stakeholders of an organisation. Every UBO-liable organisation has one or more UBOs. The UBO Register makes it transparent who is truly responsible for a business. Take, for example, a private limited company (bv) with several shareholders. In the Business Register, you cannot see the name of the shareholders. But via an extract from the UBO register, you can see all the UBO(s) of a company. Whether a company has to register UBOs depends on its legal form. A sole proprietorship, for instance, does not register UBOs. Learn more about the UBO register.
Consider the complete picture
Do you want to request all available information about your business relationship in one go? You can. The company profile (in Dutch) shows the extract from the Business Register, the history, filings and - if available - also annual accounts and concern relations.
Stay automatically informed of relevant changes in the Business Register. Such as changes in address or board, or bankruptcy. Or other matters that are important to you, like starting businesses in your business sector or in your region. For this service you can take out a mutation subscription (in Dutch). It will help you keep your customer data complete and up-to-date.
Report incorrect details
Do you believe the details of another company in the Business Register are incorrect? Notify us via this form (Dutch). This way, you will help us keep the Business Register up-to-date.
Keep your own registration up-to-date
Other companies look at your data. You have to keep the Business Register up to date and pass on any changes. This gives the people with whom you do business reassurance about your credibility. Do you want to view your registration? Check the Business Register.
Check foreign business partner
Do you do business abroad? Foreign business partners are not listed in the Business Register. For these, you can consult a foreign business register.
Victim of fraud?
Do you suspect that you are a victim of fraud? Report this to the police and to the Fraud Help Desk.