Netherlands: New Residence Permit Scheme
This article was prepared with the assistance of ABIL, the Alliance of Business Immigration Lawyers, of which Laura Danielson is an active member.
On January 1, 2015, the Dutch government introduced a residence permit scheme for start-up companies. What are the requirements and what are the first experiences with this new permit scheme?
The Dutch government is keen on enhancing the ecosystem for startup companies with the goal of becoming a top-three startup hub within Europe. One of the instruments is a facilitated residence permit scheme for the owners of startup companies.
The general scheme for entrepreneurs has proven inadequate to accommodate the visa and residence needs of this category of businesses, mainly because of too-severe requirements in terms of capital demands and (forecasted) financial results. For startup companies, these demands often are hard to meet. A specific visa has been introduced where these demands don’t apply. The “startup visa” can be issued to the owners of startup companies that have been selected by, and have signed a contract with, a Dutch facilitator; i.e., a company that offers professional support for setting up and growing startup businesses.
To sponsor a startup visa application, the facilitator must prove its expertise and reliability. In each case, this is assessed by the Ministry of Economic Affairs (MEA) upon request of the Immigration and Naturalization Service (IND). The main requirements are a proven track record of accompanying startups for at least two years, and a solid financial position.
The applying startup entrepreneur must substantiate that the product or service that is being developed is innovative, and that he or she will likely qualify for a permit based on the general points system within one year. This aspect is also assessed by MEA. The startup must provide a detailed milestone plan that includes:
- the role the applicant fulfills in the startup;
- the concept of the product or service the startup will deliver;
- the innovativeness of the product or service; and
- the milestones that need to be reached throughout the first year to take the startup from a mere concept to an actual undertaking.
The contract between the startup and the facilitator must describe:
- the nature of the accompaniment and advice from the facilitator;
- the conditions under which the accompaniment is offered; and
- the stake that the facilitator has in the startup, if any.
The startup visa is granted for one year and cannot be renewed. All persons participating in the startup company (e.g., as shareholders) are eligible for startup visas.
The anticipated total processing time is approximately four weeks. The first application was made on January 1, 2015, and was granted within five weeks. During that time, first the facilitator’s track record was approved, and subsequently the innovativeness of the startup was assessed. In essence, both the MEA and the IND proved to be able to move very fast under this scheme.
Results So Far
Since the introduction of the scheme, about 10 permits have been granted, and about 50 applications are still pending or have been denied. Although this could relate to “startup” problems and is not necessarily a reflection on the new scheme, the government’s special envoy for the improvement of the startup ecosystem, Neelie Kroes, has reportedly said that the number of visas granted should have been much higher by now, and that the new scheme is “a failure.”