Automotive and mobility: board structure and who binds the company
In this sector, who binds the company is fixed by the registered board structure and the representation rule in the trade register, not by a job title or the signature block on a dealer agreement. A country manager, fleet manager or dealer network director may sign every day without holding the authority the register actually records. Get that wrong and a distribution agreement, a floor plan pledge or a platform contract can be challenged years later.
Why this arises here
The sector runs on layered, high-frequency contracting: import and distribution agreements, dealer network agreements, fleet and lease paper, floor plan financing, and, increasingly, mobility-platform contracts. Each of these is renewed or amended far more often than the underlying corporate structure, so vertegenwoordigingsbevoegdheid (representation authority) drifts out of step with the commercial paper it supports.
A Dutch importer or national sales company is typically a subsidiary of a foreign manufacturer, with a board appointed abroad and day-to-day signing delegated locally under a power of attorney that is rarely revisited once issued. This is a corporate law and governance question, not a distribution-law one, and it is easy to miss precisely because the commercial relationship looks stable while the authority behind it has quietly moved.
The mechanics in short
Dutch company law gives the board collective authority to represent the company; the articles of association and the trade register entry state who may bind it alone, jointly, or only up to a stated value. A managing director's title says nothing about the scope of that authority: it can be full, joint, or restricted to a named category of act.
The trade register, kept by the Chamber of Commerce, is the public record a counterparty is entitled to rely on. What is entered there, not what is printed on a dealer agreement's signature block, decides whether the company is bound. A counterparty who checks the register before signing is generally protected even where the internal authority was in fact narrower; one who does not check carries that risk. If a dispute over authority reaches a Dutch court, the register entry current at the time of signing is treated as decisive.
Delegated authority granted by power of attorney to a fleet manager or a regional director sits outside the trade register. It is valid, but it has to be proven separately, by the document that grants it, each time it is relied on, and it does not update itself when the board above it changes.
The pattern specific to automotive and mobility
Three patterns recur here and do not arise the same way elsewhere.
First, floor plan financing. Vehicle stock is financed on a revolving basis, and the pledge over that stock is redrawn and re-perfected as vehicles turn over. Each drawdown relies on the same signing authority being current; a director change abroad that is not reflected in the Dutch register can put an entire drawdown in question, not just one contract. The same layered-authority problem shows up, with different triggers, in board structure in a chemicals group with a foreign parent, where it is supply contracts rather than vehicle stock that cycle faster than the board.
Second, distribution and dealer agreements are renewed on cycles the manufacturer sets, often annually or on model-year changes, frequently by someone other than the person actually registered as having authority. Termination disputes regularly turn on whether the signatory's authority matched the register at the time of the extension, not at the time of the original agreement.
Third, mobility platforms and fleet-sharing joint ventures are commonly structured with co-investment from a manufacturer and a technology or lease partner, and governance is split by veto rights rather than ordinary majority. Who can bind the joint venture toward a supplier or a lessee is then a matter of the joint venture agreement layered on top of the statutory board rule, and the two are not always aligned. Where these platforms rely on fleet telematics or usage data, the compliance question sits alongside patterns seen in data handling patterns in food and agri groups, another sector where operational data and corporate authority are tracked by different people on different clocks.
What to check
Before you sign, or before you rely on a signature already given, check three things. First, the current trade register extract for the counterparty, dated, not a copy kept on file. Second, whether the signatory's authority is a board authority recorded in the register or a delegated power of attorney that has to be produced separately. Third, for floor plan and fleet financing, whether the pledge or facility document was re-executed after the last board change, not merely treated as continuing.
Signing patterns by instrument
| Instrument | Typical signatory | Authority basis | What can go wrong |
|---|---|---|---|
| Dealer or distribution agreement | Country manager, sales director | Delegated power of attorney | Authority lapsed or narrowed, not re-checked at renewal |
| Floor plan financing pledge | Managing director | Board representation, register entry | Pledge redrawn after an unfiled board change |
| Fleet lease agreement | Fleet manager | Delegated power of attorney | Scope limited to a value band, exceeded without notice |
| Mobility platform joint venture contract | Joint venture director | Board rule plus shareholder veto | Veto right not reflected in the external signing authority |
What this does not cover
- The tax treatment of floor plan financing or fleet leasing structures.
- Type approval, homologation or vehicle registration requirements administered outside company law.
- The employment status of dealer network staff or platform drivers.
- Cross-border enforcement of a dealer termination once a Dutch judgment exists.
- Data protection obligations arising from fleet telematics or platform user data as such.
Questions
Who is legally entitled to bind a Dutch automotive subsidiary of a foreign parent?
The persons recorded in the trade register as having board representation authority, alone or jointly as the entry states. Anyone else needs a separate power of attorney that must be produced, never assumed.
Does a dealer agreement stay valid if the person who renewed it later turns out to have lacked authority?
It depends on what the trade register showed at the time of signing. A counterparty who checked the register and relied on it in good faith is generally protected; one who did not check carries the risk.
Does floor plan financing need re-signing every time a director changes?
The facility itself does not automatically lapse, but each new drawdown and each addition to the pledge should be checked against the register entry current on that date, not the one on file when the facility was first agreed.
Author
Charlotte Roos, tax and structuring. Works on board structure, representation authority and holding arrangements in Dutch groups with foreign parents.
Next step
This sits within our corporate structuring and governance work. Where the group's parent is Italian, the ownership layer is verified separately, as set out in a beneficial owner report for an Italian parent. Directors facing a challenge over signing authority in a comparable sector see similar fact patterns in director defences in energy and renewables groups. Where you need to confirm who currently binds a specific entity, a structure report sets out the registered board, the representation rule and the filing history.
Last legal review: 2026-09-24