An Introduction to AmCham


Doing Business: NL versus USA
April 19, 2012
AmCham: What is our mission?
• We are concerned with matters affecting the investment
  climate in the Netherlands. We actively promote increased
  US investment in the country.

• We are the voice of US business in matters of trade and
  investment. When we speak, governments listen – in The
  Hague, in Brussels and in Washington DC.




                                                         2
AmCham Netherlands:
•   Conceived in June 1961, born in October of the same year
    and up and running since January 1962
•   A non-profit, non-governmental, non-political organization
•   AmCham organization consists of a Board of Directors
    (28 persons), 11 Committees and 4,2 fte staff
•   AmCham offices are located at WTC, Schiphol Airport
•   Member of the European Council of American Chambers
    of Commerce - representing 40 Chambers: 17.000
    employers and over 20 million workers
•   Fully accredited member of the U.S. Chamber of
    Commerce – our avenue in Washington DC

                                                           3
Who are our Members?
• American companies operating in the Netherlands
• Dutch companies exporting to or investing in the USA
  (Netherlands is third largest investor in USA)
• Professionals and other individuals whose activities are
  related to US-Dutch economic and business relations

= Almost 400 companies, represented by about 800
  individuals, interested in commercial relations between
  the USA and the Netherlands
= 45 Patron members
  137 Corporate members
  185 Contributing members
                                                             4
What do we do?
  Committees:
  • Human Resources (People Platform), Legal,
    Tax, Policy, Pharmaceutical and Diversity
  • Marketing & Membership, Nominations
  • Rotterdam Chapter & Brabant Chapter
  • Young Professionals Group

  Publications:
  • AmCham Membership Directory
  • AmCham Newsletter and Digital Newsletter
  • Investors’ Agenda of Priority Points
                                                5
What else do we do?
 AmCham events focus on current business issues,
 networking, and social functions

  • Seminars, Late Afternoon Briefings, Lunch and
    Dinner meetings with political and business leaders,
    biennial Black Tie Dinner, annual Golf Tournament,
    annual Wine & Cheese Party, Young Professional
    events




                                                           6
Champs on Stage
•   From August 2007, pilot in Rotterdam with 66
    students
TO
• School year 2010-2011
    14 schools
    3 cities
    1210 students in program
    More than 430 companies and
     organizations participating
    375 company mentors involved

•   Champs on Stage Foundation per 1 July 2010


                                                   7
AmCham,
Working for a Better Business Climate
•   Valuable opportunities for networking
•   Business presentations given by experts
•   A voice for your opinions and concerns
•   Better investment and trade conditions
•   Up to date information via publications and website
•   A guide for contacts and new trends
•   Active demonstration of your support for better
    transatlantic business




                                                          8
Priority Points
Investor’s Agenda of Priority Points:
Our advocacy program to improve NL investment climate
In 2012 we will focus on:

• Stimulate labor flexibility and engage in strategic (labor)
  immigration policy

• Stimulate Innovation - Implement what works!

• Taxation - Consistent, predictable & simple

                                                                9
Tax-related Priority Points – Ensure stability, consistency,
predictability and simplicity in tax legislation


• Adopt the proposal of the Chairman Topteam
  Hoofdkantoren in respect of interest expense relating to
  the financing of subsidiaries
• Simplify the existing interest deduction limitation rules to
  increase clarity among the business community
• Have tax losses carried forward indefinitely
• Reduce the tax wedge on labor
• Conclude tax treaties with important trade partners and
  with emerging economies with high growth



                                                               10
US Investment in the Netherlands
• The first investors in the Netherlands came in the late 19th
  century. One was Standard Oil. Also at around the same
  time was Quaker Oats. They’re both still here!
• US total investment stake in NL in 2010 over $520 billion
  (almost 25% of total EU)
• US FDI in 2010 to NL: $40 billion (= 22% of all investment
  to EU in 2010)
• US majority-owned companies employed 225,000 persons
  in NL in 2009
• NOTE: NL is 3rd largest investor in US


                                                           11
Six Largest Sources of Foreign Investment in NL – the
     US is still number 1 (there are about 1,700 US
     companies in NL)
90
80
70
60                                                            USA
                                                              UK
50                                                            L
40                                                            F
                                                              B
30
                                                              D
20
10
0

     Stock of foreign investment in 2009; billions of euros
     Source: De Nederlandsche Bank
                                                                    12
OK, but how many mailbox companies are
we talking about?

     The Netherlands, the New Tax Shelter Hot Spot
          (Headline in The New York Times of February 4, 2007)



 Just over 39% of US investment abroad is in foreign
 affilliates classified as holding companies. For the
 Netherlands this figure is 73% - i.e. some $380 billion.

 That still leaves some $140 billion of hard business
 investment – almost as much as in Germany and France
 combined, or almost twice that in all the Scandinavian
 countries combined.

                                                                 13
Top 7 Destinations for US Direct Investment in Europe
– 2010 (historical-cost basis)




    Billions of Dollars                                 14
    Source: US Dept. of Commerce
Europe still most important destination for US Direct
 Investment Abroad – over 55% of total in 2010




US Direct Investment Abroad - Historical cost basis 2010
Billions of dollars
Source: US Dept. of Commerce


                                                           15
US Investment in NL compared with other countries
– almost as much (ex. holdings) in NL as in BRIC




                                                    16
Total US Foreign Direct Investment 1990 – 2008




                                                 17
US Direct Investment – NL punching above its weight class
     (excluding holding co’s; billions of US dollars rounded to nearest whole billion; percentage
     indicated is portion of total US investment in Europe)



                  1990                 2003                 2005                 2010

NL                $19       9%         $73        12%       $84       11%        $140      12%


UK                $73      34%         $210       36%       $279      36%        $371      32%

D                 $28      13%         $56        10%       $63        8%        $79        7%


CH                $25      12%         $30         5%       $44        6%        $73        6%


B                 $10      4.4%        $24         4%       $46        6%        $67        6%


Europe            $215                 $585                 $766                 $1,175

                                                                                              18
Last Minute! Developments in 2011
• US FDI to Europe in 2011 topped $200 billion for only the
  second time on record. Investment flows reached $215
  billion – a 23% jump from 2010.
• In first 9 months of 2011 US FDI flows rose by 35% to NL
• US investment fell 52% in Italy, 50% in Belgium and 26% in
  UK.
• Worldwide corporate US foreign assets totaled $20 trillion
  in 2010. 58% located in Europe. Largest share: UK (22%,
  $4.4 trillion); second largest share: NL ($1.6 trillion)
• US affiliates in 2010 earned 4 times more in NL alone ($54
  billion) than they did in China and India combined ($13.5
  billion)
                                                        19
Added Value of Foreign Investment
• Foreign investors are catalysts for productivity and
  growth in the Dutch economy. They are:

                        Are more successful
                        Create more employment
                        Hire more skilled workers
                        Outsource more locally

than their Dutch counterparts.

Source: Min. of Economic Affairs - Buitenlandse Investeerders zijn Groeiversnellers
voor de Nederlandse Economie (July 2007)


                                                                                  20
The same study notes that more of these
catalysts can be attracted by:


• Continually improving the investment climate

  The challenge for government is similar to that of
  companies in a competitive environment: a systematic,
  sustained effort is needed to continually upgrade all the
  parameters that make a nation competitive.




                                                         21
AmCham in a decade from now?




                               22
Where is AmCham in 10 years time?

Several reasons for membership decline may be discerned.

• The comparatively (among western economies) very good
  investment climate in the Netherlands as a whole for US
  and other foreign companies.

• Many initial advocacy aims formulated in the early 1960s
  have been largely achieved leaving less need for an
  advocacy platform.


                                                        23
Where is AmCham in 10 years time?


• The rise of the global company who does not see itself
  having a nationality at all.

Many American companies do not want to be seen as being
US in origin, but as being international. Some companies
even have a general policy that forbids membership in
organizations such as AmCham.




                                                           24
Other Associations also in state of flux
• One can also see a parallel development in employer and
  labor organizations in the Netherlands (and elsewhere for
  that matter).

• Protestant, catholic and secular employer associations
  and trade unions have lost their distinctive characters and
  have either disappeared or have merged.

• Many foreign employer associations in the Netherlands
  similar to AmCham have disappeared or adopted a more
  social than a business advocacy function.

                                                          25
Where is AmCham in 10 years time?


• The challenge to secure AmCham's future may lie in
  distinguishing a role for itself within employers'
  organizations in the Netherlands as the coordinating voice
  for all foreign investors.




                                                        26
Working for a Better Business Climate

advocacy - information - networking



www.amcham.nl

Amcham simon paul

  • 1.
    An Introduction toAmCham Doing Business: NL versus USA April 19, 2012
  • 2.
    AmCham: What isour mission? • We are concerned with matters affecting the investment climate in the Netherlands. We actively promote increased US investment in the country. • We are the voice of US business in matters of trade and investment. When we speak, governments listen – in The Hague, in Brussels and in Washington DC. 2
  • 3.
    AmCham Netherlands: • Conceived in June 1961, born in October of the same year and up and running since January 1962 • A non-profit, non-governmental, non-political organization • AmCham organization consists of a Board of Directors (28 persons), 11 Committees and 4,2 fte staff • AmCham offices are located at WTC, Schiphol Airport • Member of the European Council of American Chambers of Commerce - representing 40 Chambers: 17.000 employers and over 20 million workers • Fully accredited member of the U.S. Chamber of Commerce – our avenue in Washington DC 3
  • 4.
    Who are ourMembers? • American companies operating in the Netherlands • Dutch companies exporting to or investing in the USA (Netherlands is third largest investor in USA) • Professionals and other individuals whose activities are related to US-Dutch economic and business relations = Almost 400 companies, represented by about 800 individuals, interested in commercial relations between the USA and the Netherlands = 45 Patron members 137 Corporate members 185 Contributing members 4
  • 5.
    What do wedo? Committees: • Human Resources (People Platform), Legal, Tax, Policy, Pharmaceutical and Diversity • Marketing & Membership, Nominations • Rotterdam Chapter & Brabant Chapter • Young Professionals Group Publications: • AmCham Membership Directory • AmCham Newsletter and Digital Newsletter • Investors’ Agenda of Priority Points 5
  • 6.
    What else dowe do? AmCham events focus on current business issues, networking, and social functions • Seminars, Late Afternoon Briefings, Lunch and Dinner meetings with political and business leaders, biennial Black Tie Dinner, annual Golf Tournament, annual Wine & Cheese Party, Young Professional events 6
  • 7.
    Champs on Stage • From August 2007, pilot in Rotterdam with 66 students TO • School year 2010-2011  14 schools  3 cities  1210 students in program  More than 430 companies and organizations participating  375 company mentors involved • Champs on Stage Foundation per 1 July 2010 7
  • 8.
    AmCham, Working for aBetter Business Climate • Valuable opportunities for networking • Business presentations given by experts • A voice for your opinions and concerns • Better investment and trade conditions • Up to date information via publications and website • A guide for contacts and new trends • Active demonstration of your support for better transatlantic business 8
  • 9.
    Priority Points Investor’s Agendaof Priority Points: Our advocacy program to improve NL investment climate In 2012 we will focus on: • Stimulate labor flexibility and engage in strategic (labor) immigration policy • Stimulate Innovation - Implement what works! • Taxation - Consistent, predictable & simple 9
  • 10.
    Tax-related Priority Points– Ensure stability, consistency, predictability and simplicity in tax legislation • Adopt the proposal of the Chairman Topteam Hoofdkantoren in respect of interest expense relating to the financing of subsidiaries • Simplify the existing interest deduction limitation rules to increase clarity among the business community • Have tax losses carried forward indefinitely • Reduce the tax wedge on labor • Conclude tax treaties with important trade partners and with emerging economies with high growth 10
  • 11.
    US Investment inthe Netherlands • The first investors in the Netherlands came in the late 19th century. One was Standard Oil. Also at around the same time was Quaker Oats. They’re both still here! • US total investment stake in NL in 2010 over $520 billion (almost 25% of total EU) • US FDI in 2010 to NL: $40 billion (= 22% of all investment to EU in 2010) • US majority-owned companies employed 225,000 persons in NL in 2009 • NOTE: NL is 3rd largest investor in US 11
  • 12.
    Six Largest Sourcesof Foreign Investment in NL – the US is still number 1 (there are about 1,700 US companies in NL) 90 80 70 60 USA UK 50 L 40 F B 30 D 20 10 0 Stock of foreign investment in 2009; billions of euros Source: De Nederlandsche Bank 12
  • 13.
    OK, but howmany mailbox companies are we talking about? The Netherlands, the New Tax Shelter Hot Spot (Headline in The New York Times of February 4, 2007) Just over 39% of US investment abroad is in foreign affilliates classified as holding companies. For the Netherlands this figure is 73% - i.e. some $380 billion. That still leaves some $140 billion of hard business investment – almost as much as in Germany and France combined, or almost twice that in all the Scandinavian countries combined. 13
  • 14.
    Top 7 Destinationsfor US Direct Investment in Europe – 2010 (historical-cost basis) Billions of Dollars 14 Source: US Dept. of Commerce
  • 15.
    Europe still mostimportant destination for US Direct Investment Abroad – over 55% of total in 2010 US Direct Investment Abroad - Historical cost basis 2010 Billions of dollars Source: US Dept. of Commerce 15
  • 16.
    US Investment inNL compared with other countries – almost as much (ex. holdings) in NL as in BRIC 16
  • 17.
    Total US ForeignDirect Investment 1990 – 2008 17
  • 18.
    US Direct Investment– NL punching above its weight class (excluding holding co’s; billions of US dollars rounded to nearest whole billion; percentage indicated is portion of total US investment in Europe) 1990 2003 2005 2010 NL $19 9% $73 12% $84 11% $140 12% UK $73 34% $210 36% $279 36% $371 32% D $28 13% $56 10% $63 8% $79 7% CH $25 12% $30 5% $44 6% $73 6% B $10 4.4% $24 4% $46 6% $67 6% Europe $215 $585 $766 $1,175 18
  • 19.
    Last Minute! Developmentsin 2011 • US FDI to Europe in 2011 topped $200 billion for only the second time on record. Investment flows reached $215 billion – a 23% jump from 2010. • In first 9 months of 2011 US FDI flows rose by 35% to NL • US investment fell 52% in Italy, 50% in Belgium and 26% in UK. • Worldwide corporate US foreign assets totaled $20 trillion in 2010. 58% located in Europe. Largest share: UK (22%, $4.4 trillion); second largest share: NL ($1.6 trillion) • US affiliates in 2010 earned 4 times more in NL alone ($54 billion) than they did in China and India combined ($13.5 billion) 19
  • 20.
    Added Value ofForeign Investment • Foreign investors are catalysts for productivity and growth in the Dutch economy. They are: Are more successful Create more employment Hire more skilled workers Outsource more locally than their Dutch counterparts. Source: Min. of Economic Affairs - Buitenlandse Investeerders zijn Groeiversnellers voor de Nederlandse Economie (July 2007) 20
  • 21.
    The same studynotes that more of these catalysts can be attracted by: • Continually improving the investment climate The challenge for government is similar to that of companies in a competitive environment: a systematic, sustained effort is needed to continually upgrade all the parameters that make a nation competitive. 21
  • 22.
    AmCham in adecade from now? 22
  • 23.
    Where is AmChamin 10 years time? Several reasons for membership decline may be discerned. • The comparatively (among western economies) very good investment climate in the Netherlands as a whole for US and other foreign companies. • Many initial advocacy aims formulated in the early 1960s have been largely achieved leaving less need for an advocacy platform. 23
  • 24.
    Where is AmChamin 10 years time? • The rise of the global company who does not see itself having a nationality at all. Many American companies do not want to be seen as being US in origin, but as being international. Some companies even have a general policy that forbids membership in organizations such as AmCham. 24
  • 25.
    Other Associations alsoin state of flux • One can also see a parallel development in employer and labor organizations in the Netherlands (and elsewhere for that matter). • Protestant, catholic and secular employer associations and trade unions have lost their distinctive characters and have either disappeared or have merged. • Many foreign employer associations in the Netherlands similar to AmCham have disappeared or adopted a more social than a business advocacy function. 25
  • 26.
    Where is AmChamin 10 years time? • The challenge to secure AmCham's future may lie in distinguishing a role for itself within employers' organizations in the Netherlands as the coordinating voice for all foreign investors. 26
  • 27.
    Working for aBetter Business Climate advocacy - information - networking www.amcham.nl