A general partnership (VOF, vennootschap onder firma in Dutch) is a form of cooperation between two or more persons who intend to run a business under a joint name. Investments, insurances and the payment of VAT are jointly settled.
Who is involved?
The ultimate power to take decisions rests with the partners of the general partnership. A general partnership can take persons into employment and/or contractors, volunteers and trainees who work for the general partnership.
Who disposes of the capital?
Agreements on competences, contribution of capital and the division of profits can be made in a solicitor’s office.
Who is liable?
Like the partnership, the general partnership is a legal personality without legal entity. This means that in the last resort the partners are also liable with their private capital for the debts of the business. But the private creditors of one partner cannot lay claim to the capital of the general partnership, nor to the private capital of the other partners. That is thus different from the partnership.
Vof in the theatre world
In the theatre world the general partnership is commonest among décor designers etc. A number of designers present themselves under a joint name, produce joint publicity, jointly rent a workspace and arrange profitsharing.