Opening Bank Accounts for Dutch-Owned Subsidiaries in the USA
For obvious reasons, there are strict regulations that need to be abided by to make sure accounts opened are for legitimate companies with legitimate operations and transactions that conform to US law and regulations. When accounts are opened for Dutch-owned subsidiaries (or any EU-owned subsidiaries in general), there are some extra due diligence steps that need to be adhered to. As a result, some financial institutions do not have the capacity, knowledge, or experience, or forego having the additional capacity due to additional costs, to be able to open accounts for Dutch-owned subsidiaries.
For those financial institutions that can open accounts, it is advised to make sure you work with a corporate relationship manager that has the experience of working with EU-owned subsidiaries. There are many challenges the subsidiary will face, so having a properly functioning account with the capacity to perform various transactions will be very important. Another important topic is making sure you are very open with the financial institution about your volume and annual revenue expectations. Frequently, some institutions have closed accounts due to the size of the entity or insufficient volume. In addition, ask if the account can be opened by a “non-US residing” person (foreigner). This is important in the event an entity loses its US residing employee(s). Ask if the relationship manager can make decisions to allow for various services and test the relationship manager’s knowledge of bank services. This will help you quickly understand if that bank and person can help you.
Furthermore, make sure you can have full access to the bank account in The Netherlands. Online services to conduct transactions are known as treasury management services in the USA. These are very helpful tools to have if you only have business development people in the USA. Lastly, make sure to understand the requirements in the event you need to make changes to the account. Some institutions will require that you meet them in person to make changes, which is typically the case when you open the account at a bank branch.
At Comerica Bank, we have a large international division that works exclusively with reverse investment entities. It is one of our core markets that we started in 1960. The process of opening an account is done in 3 steps. During the initial step, the entity must fill out a Comerica questionnaire, provide Certificate of Formation/Incorporation, provide Certificate of Good Standing, and provide passports of those involved (or US driver’s license if they reside in the US). Sometimes, there is a step “b” when an entity is a limited liability entity, which requires a consent from the members. Comerica will take the information, perform a background check and occasionally might have additional question(s). When backgrounds are approved, a signature card will be completed with a declaration for accounts and treasury management (cash management). This will be sent back to the entity for signatures. Upon completion, the account will be opened within a couple of business days when fully approved. Last step is for the new customer to decide on the types of services it needs. This relates primarily to the online services. Under this scenario, it is highly recommended to ask the relationship manager for advice. The primary sources of payments in the US are: checks, automated clearing house (ACH – electronic payment used within the USA), electronic wire (payment form for global electronic payments), corporate/credit cards, and cash. We highly recommend using ACH, wires, and corporate cards. ACH and wires are used for invoices, whereas you want to make sure your business development team has corporate cards to use for travel, entertainment, and small office expenses. Besides opening accounts and corporate cards, Comerica can help you with merchant services, foreign exchange, letters of credit, escrow, accounts for your ex-patriot employees, loans, etc. The Bank is entrusted by several Dutch-owned subsidiaries to be their financial partner. We assist companies of various sizes in various ways from start-up subsidiaries to large corporate entities. We assist entities throughout their growth cycles and in various industries. Lastly, our International Division has a Dutch speaker – Aryan Dokht that grew up in The Netherlands. One of his responsibilities is to fly to The Netherlands to meet with the Parent Companies of our clients with the objective to enhance the trust and relationship between the 2 entities.
For any questions, please feel free to reach out to Aryan Dokht at email@example.com with any further questions. We would be happy to assist you with your financial requirements.