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Shares in a BV (private limited company) are the certificates of ownership of the company. Whoever holds them is a shareholder and is therefore entitled to profits (dividends), the right to vote at the general meeting, and an ownership interest in the value of the company. Since the Flex-BV Act (2012), the rules regarding shares have been significantly relaxed: various types, differing rights, and even shares without voting or profit rights are now possible. Below are the basics, the roles, and the special types.
Bram and Joris from our AHO cluster — two co-founders of a private limited company — discovered after a few years that they could have structured their shareholding much more intelligently. Simply holding 50% of the shares each led to the familiar stalemates; with letter shares and clear statutory provisions, they would have reached an agreement sooner. Below: how shares work, the associated rights, and the different types available.
The short answer: what are shares?
A share is a unit of ownership in a private limited company. Someone who holds a share has three main rights:
- Property law. Right to a proportionate share of equity upon sale or liquidation.
- Profit entitlement. Right to a proportional share of the dividend distributed by the private limited company.
- Voting rights. Right to vote at the General Meeting of Shareholders (AGM) — on directors, articles of association, annual accounts, dividends.
Shares in a BV are registered shares (not bearer shares) and are entered in the shareholders' register. Transfer usually requires a notarial deed of transfer. The legal basis is found in Book 2 of the Dutch Civil Code.
The roles: shareholder, director, managing director
Three roles that are not the same:
- Shareholder — holder of shares. Decides on the course and strategy via the general meeting.
- Director — day-to-day manager of the BV. Represents the company, enters into contracts, implements decisions.
- DGA (Director-Major Shareholder) — combines both roles and holds at least 5% of the shares. A separate category for tax purposes.
In a typical one-person BV, the same person is both a shareholder and a director. With multiple founders, the roles are often separated: founders are shareholders, while one becomes a statutory director. We explain the difference between articles of association and a shareholders' agreement in shareholders' agreement vs. articles of association.
Types of shares
Since 2012, you are allowed to create multiple types of shares with differing rights in the articles of association:
- Ordinary shares. Standard — entitlement to dividends, voting rights, and pro rata capital.
- Letter shares (A, B, C). Different classes with their own rights — often used to position founders, investors, and employees separately. See letter shares.
- Cumulative preferred shares. Priority over dividends that accrue if they are not paid out. See cumprefs.
- Priority shares. Special decision-making rights — for example, veto over a sale or appointment of the board. See priority shares.
- Non-voting or non-profit-sharing shares. Shares without voting rights (capital/profit only) or without profit rights (voting only). For employee participation or family structures. See non-voting/non-profit-sharing.
Transfer shares
Shares in a private limited company (BV) are not freely transferable. The articles of association usually contain a blocking provision: in the event of a sale, the shareholder must first offer the shares to the other shareholders. Only if they decline may an external buyer proceed. The transfer itself requires a notarial deed.
With multiple shareholders, a shareholders' agreement in addition to the articles of association is strongly recommended — with provisions for good leaver/bad leaver, tag along, drag along, and deadlock. See what is a shareholders' agreement.
What do you do with the shares administratively?
Three mandatory items:
- Maintain a shareholders' register. Mandatory for every private limited company (BV). Contains names, number, type, and paid-up capital. Lost it? See lost shareholders' register.
- UBO notification if interest > 25%. Mandatory within eight days of registration.
- Notarial deed upon transfer. A share transfer without a notary is, in principle, invalid.
Honest recommendation
At the time of incorporation, you can often still suffice with standard shares — simple and inexpensive. As soon as you acquire multiple shareholders, attract investors, or desire a specific structure (employee participation, family holding), the types of shares become a serious puzzle. Discuss this before the notary gets involved, otherwise you will be stuck later with an amendment to the articles of association costing €750.
For the basics: what is a BV. For the legal infrastructure with multiple shareholders: have a shareholders' agreement drafted.
Frequently Asked Questions
Units of ownership in the company. A shareholder is entitled to a proportional share of the assets, to dividends, and — in principle — to a vote at the general meeting. Shares in a BV are registered shares and are listed in the shareholders' register.
A shareholder owns shares and has ownership rights. A director is the person who manages and represents the BV on a day-to-day basis. In the case of a one-person BV, it is the same person (the managing director); with multiple founders, the roles are often separated.
Ordinary shares, letter shares (A, B, C with individual rights), cumulative preferred shares (priority to dividends), priority shares (special decision-making rights), and shares without voting or profit rights. Since the Flex-BV Act (2012), these types can be freely structured in the articles of association.
Generally, not without conditions. The articles of association usually include a blocking provision: in the event of a sale, you must first make an offer to the other shareholders. Only if they decline may an external buyer proceed. A shareholders' agreement may impose additional conditions.
A mandatory register in which a BV records who the shareholder is, how many shares someone holds, of what type, and what the contribution is. Indispensable for proof of ownership and during transfer. Loss leads to practical problems — a notarial reconstruction is then necessary.
Yes. A transfer of shares in a BV requires a notarial deed. Without that deed, the transfer is in principle not valid, and the shares remain in the name of the previous shareholder.
For investors seeking priority on dividends (cumprefs), for employee participation without control (non-voting shares), for family holding structures with mutually differing rights, or for multiple founders fulfilling different roles (letter shares). Discuss with a lawyer in advance which combination suits your structure.
