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Reference
Dutch fund terminology, A to Z
Plain language definitions of the legal, tax and regulatory terms you meet when forming and running a Dutch fund.
A
- AIFMD Alternative Investment Fund Managers Directive
- The European directive governing managers of alternative investment funds. It sets rules on licensing, capital, depositary appointment, valuation, remuneration and supervisory reporting. In the Netherlands it is implemented in the Wft.Read more
- AIF Alternative Investment Fund / alternatieve beleggingsinstelling
- A collective investment undertaking that raises capital from a number of investors to invest it according to a defined policy, and that is not a UCITS. Most Dutch private equity and venture capital funds qualify as an AIF.
- Annex IV AIFMD supervisory reporting
- The periodic AIFMD reporting template filed with the supervisor, covering fund exposures, leverage, liquidity and principal markets. Dutch managers file it with DNB on a quarterly, semi-annual or annual cycle depending on assets under management.Read more
- AFM Autoriteit Financiële Markten
- The Dutch conduct supervisor for financial markets. It handles fund manager licensing, registration under the light regime, prospectus approval and conduct of business supervision.
- Aandeelhoudersregister shareholders register
- The statutory register of shares, holders and transfers kept by a BV or NV. For fund structures it is the legal record behind the cap table and it must stay reconciled with subscription and transfer documentation.
B
- Bewaarder depositary
- The independent party appointed under AIFMD to safekeep fund assets, monitor cash flows and verify that subscriptions, valuations and distributions follow the fund documentation. A licensed Dutch manager must appoint one per fund.
- Beheerder fund manager / AIFM
- The entity responsible for portfolio management and risk management of the fund. The beheerder holds the licence or registration, signs the fund documentation and carries the regulatory obligations.
- Beleggingsinstelling investment fund
- The Dutch legal term for a collective investment vehicle. The label matters because it triggers Wft supervision, marketing restrictions and the choice between a licence and the registration regime.
- Beleggingsbeleid investment policy
- The mandate that defines what the fund may invest in: strategy, sectors, geography, ticket sizes and concentration limits. It sits in the fund terms and drives investment compliance checks on every deal.
- BV besloten vennootschap
- The Dutch private limited company. In fund structures it is used for the manager entity, the general partner, the stichting alternative and most deal SPVs, because it offers limited liability and a familiar governance model.Read more
C
- CV commanditaire vennootschap
- The Dutch limited partnership, the most common private equity fund form. It has one or more managing partners with unlimited liability and limited partners whose liability is capped at their commitment. A closed CV is fiscally transparent.Read more
- Capital call kapitaalopvraging
- A notice drawing down part of an investor commitment to fund investments, fees or expenses. Notices state the amount, due date, purpose and payment details, and each payment updates the investor capital account.Read more
- Carried interest winstdeling beheerteam
- The share of fund profits, typically twenty percent, allocated to the management team once investors have received their capital back plus the hurdle. In the Netherlands it is usually assessed under the lucratief belang rules.Read more
- Closing sluiting van een inschrijvingsronde
- The moment commitments are formally accepted into the fund. A first closing starts the investment period, later closings admit new investors, usually with an equalisation payment so all investors end up on the same economic footing.
- Commanditaire vennoot limited partner
- The passive partner in a CV. Liability is limited to the committed amount as long as the partner does not act on behalf of the partnership, which is why management authority sits entirely with the managing partner.Read more
- Cooperatie cooperative
- A membership based legal entity that in Dutch practice is frequently the fund itself, with investors admitted as members instead of shareholders. It is also used as a feeder into a CV or FGR and as a hold-co beneath a CV. It offers flexible profit allocation and, in many cross border set ups, an efficient withholding tax position compared with a BV.Read more
D
- Deelnemingsvrijstelling participation exemption
- The Dutch participation exemption, which shelters dividends and capital gains on a qualifying participation, as a rule an interest of at least 5%, from corporate income tax. Because a CV is tax transparent, an investment is attributed to its participants pro rata, so an opaque cooperative is sometimes interposed to hold the participation and have the 5% threshold tested at its own level.
- DNB De Nederlandsche Bank
- The Dutch prudential supervisor. For fund managers it oversees own funds requirements, sound operations and the Annex IV supervisory reporting flow.
- Distributie distribution
- A payment of proceeds from the fund to its investors, from exits, dividends or interest. Distributions run through the waterfall, which determines how much goes to investors and how much to carried interest.
- Doorlopend toezicht ongoing supervision
- The continuing obligations that apply after a licence is granted: periodic reporting, notification of material changes, fitness and propriety testing of policymakers, and payment of supervisory levies.
- Drempelvrijstelling threshold exemption
- The AIFMD threshold below which a manager may register rather than obtain a full licence, broadly one hundred million euro with leverage or five hundred million euro unleveraged and closed ended. Registered managers may only offer to qualified investors or within the small offering rules.
E
- Equalisation gelijkstelling bij latere closings
- The mechanism that puts investors joining at a later closing on the same footing as earlier ones. They pay in their share of prior calls plus an equalisation charge, which is then credited to the existing investors.
- ESG / SFDR Sustainable Finance Disclosure Regulation
- The European sustainability disclosure framework. Funds are positioned as article 6, 8 or 9, which determines the pre contractual disclosures, website statements and periodic reporting the manager must produce.
F
- FGR fonds voor gemene rekening
- A contractual Dutch fund without legal personality, formed by agreement between manager, title holder and participants. Since the 2025 reform an FGR is fiscally transparent unless it meets the investment fund definition, which makes the participation transfer rules decisive.Read more
- Fondsvoorwaarden fund terms
- The governing terms of the fund: the limited partnership agreement for a CV or the terms and conditions of management for an FGR. They fix economics, governance, transfer restrictions and the default regime.
- Fund of funds dakfonds
- A fund that invests in other funds rather than directly in companies. It adds a second layer of fees and reporting, so look through data on the underlying funds is essential for investor reporting.
G
- GP / beherend vennoot general partner
- The managing partner of a CV, with unlimited liability and sole authority to bind the fund. In practice it is a dedicated BV so the liability sits in a ring fenced entity.Read more
- Governance besluitvorming en toezicht
- The decision making architecture of the fund: investor consent thresholds, advisory committee powers, conflict of interest procedures and key person provisions. Every consent right should be traceable to a resolution and a vote record.
H
- Hurdle rate drempelrendement
- The minimum return investors receive before the manager shares in profits, typically eight percent per year compounded. Whether it is a hard hurdle or comes with a catch up materially changes the split.Read more
- High-water mark hoogste eerdere waardering
- The highest previous net asset value used as a reference for performance fees. The manager only earns a performance fee on value above that mark, so earlier losses must be recovered first.
I
- Informatiememorandum information memorandum
- The offering document describing the strategy, team, terms, risks and structure of the fund. Under the registration regime it replaces an approved prospectus and is the primary liability document towards investors.
- Investeerder investor
- The party committing capital to the fund. Dutch documentation distinguishes professional and non professional investors, because that classification drives marketing rules, minimum ticket sizes and disclosure duties.Read more
- Inschrijvingsformulier subscription form
- The form by which an investor commits to the fund, containing the commitment amount, representations, tax classifications and KYC data. Signing it binds the investor to the fund terms.
K
- KYC / CDD cliëntenonderzoek
- The client due diligence a manager performs before accepting an investor: identification, verification, ultimate beneficial owner analysis, source of funds and sanctions screening. Requirements follow from the Wwft and must be refreshed periodically.Read more
- Kapitaalstorting capital contribution
- The actual payment of capital by an investor in response to a call. Contributions reduce undrawn commitment and increase the paid in balance on the capital account.
L
- LP / commanditaire vennoot limited partner
- The investor side of a limited partnership. The LP provides capital, has no management authority and receives distributions according to the waterfall in the fund terms.Read more
- Lucratief belang carried interest taxation
- The Dutch tax regime for management participations with a disproportionate return, which is where carried interest typically lands. Structuring the carry vehicle and its terms determines whether income is taxed in box 1 or, via an indirect holding, in box 2.
- Liquidatie liquidation / wind down
- The wind down of the fund after the term ends: realising remaining assets, settling liabilities, making final distributions and preparing the liquidation account for investors.
M
- Management fee beheervergoeding
- The recurring fee paid to the manager, usually a percentage of commitments during the investment period and of invested cost afterwards. Accrual basis, step downs and offsets against portfolio fees all change the effective amount.
- MiFID II Markets in Financial Instruments Directive
- The European framework for investment services. It matters for fund managers that also provide individual portfolio management or investment advice, and for the placement chain used to distribute the fund.
N
- Nevenbrief side letter
- A bilateral agreement granting a specific investor terms that differ from the fund documentation, such as fee discounts, reporting rights or excuse provisions. Most favoured nation clauses can extend those terms to other investors.
O
- Onboarding toelating van investeerders
- The process from expression of interest to admitted investor: suitability and classification checks, KYC, subscription documents, signature and capital account set up.Read more
- Open-end / closed-end fund liquidity type
- Open end funds issue and redeem participations at NAV on a recurring basis. Closed end funds have a fixed term with no redemption rights, which is the standard model for Dutch private equity and venture capital.
P
- PPM private placement memorandum
- The offering memorandum used in a private placement. Functionally the English language counterpart of the informatiememorandum, with risk factors, terms summary and track record.
- Prospectusplicht prospectus obligation
- The duty to publish an approved prospectus when securities are offered to the public. Fund offerings usually rely on an exemption, for example qualified investors only, fewer than one hundred fifty persons, or a minimum of one hundred thousand euro per investor.
- PEP politiek prominent persoon
- A politically exposed person, their family members and close associates. Accepting one as an investor requires enhanced due diligence, senior management approval and source of wealth verification under the Wwft.Read more
R
- Registratieregime registration regime
- The lighter AFM regime for managers below the AIFMD thresholds. It requires registration and periodic notifications instead of a full licence, but restricts the investors that may be approached.Read more
- Rendementsverdeling profit allocation / waterfall
- The contractual order in which proceeds are allocated: return of capital, hurdle, catch up, then the split between investors and carried interest. Whether it applies deal by deal or on a whole of fund basis changes timing significantly.Read more
S
- Side letter nevenbrief
- The English term for a nevenbrief. Tracking the provisions is operationally critical, because fee discounts, excuse rights and reporting commitments have to be applied in every call, distribution and report.
- Storting payment on a call
- The payment made by an investor on a capital call. Late payment triggers the default regime in the fund terms, typically default interest and, after a cure period, forfeiture of part of the interest in the fund.
- Subscription agreement inschrijvingsovereenkomst
- The agreement by which the investor is admitted to the fund and accedes to the fund terms. It records the commitment, the representations relied on by the manager and the tax and regulatory classifications.
T
- Term sheet hoofdlijnen van de fondsvoorwaarden
- The document setting out the commercial terms of the fund before the full documentation is drafted: size, term, fees, hurdle, carry, governance and structure. Kept as a living record, it stays the single source of truth that the fund documents render from.Read more
- Transparantie (fiscaal) fiscal transparency
- A fund is fiscally transparent when it is not itself subject to corporate income tax and results are attributed directly to the investors. For a CV or FGR this depends on the transfer restrictions for interests or participations.Read more
V
- Vergunningplicht licence requirement
- The obligation to hold an AFM licence as a manager of an investment fund. It applies once the AIFMD thresholds are exceeded or when retail investors are approached, and it brings capital, depositary, valuation and reporting duties.
- VBI vrijgestelde beleggingsinstelling
- The Dutch exempt investment institution regime. A qualifying vehicle is exempt from corporate income tax, but it must invest in financial instruments, apply risk spreading and offer redemption rights, which rules it out for most private equity funds.
- Vrijstelling exemption
- An exception to a supervisory obligation, for instance from the prospectus duty or the licence requirement. Each exemption comes with conditions and often a mandatory warning statement in offering materials.
W
- Waterfall rendementsverdeling
- The calculation cascade applied to every distribution. Each tier is paid in full before the next begins, so small drafting differences in the catch up or the clawback change investor outcomes materially.Read more
- Wft Wet op het financieel toezicht
- The Dutch Financial Supervision Act. It is the statute that implements AIFMD and MiFID II and that contains the licence, registration, offering and ongoing supervision rules for fund managers.
- Wwft Wet ter voorkoming van witwassen en financieren van terrorisme
- The Dutch anti money laundering act. It requires client due diligence, ultimate beneficial owner identification, ongoing monitoring, sanctions screening and reporting of unusual transactions to FIU Nederland.Read more
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