When onboarding a foundation (stichting) for KYC, we often ask for a copy of the articles of association. Why is this necessary?
Confirming representation
A foundation’s articles of association set out who is authorized to represent the foundation. This can be the full board, or specific roles appointed within the board. Only authorized signatories may sign contracts or carry out transactions, and this is specified in the articles of association.
Checking authority limits
Directors and board members of a foundation may have limits on their authority. This can relate to the type of actions they can take, voting rights, or transaction amounts. This information matters to avoid accepting transactions from individuals who are not authorized.
UBO identification
Foundations do not have shareholders. Still, for complete KYC onboarding, we also need to determine the UBOs for a foundation. We do this based on information included in the articles of association, such as who can benefit or who may exercise decisive influence.
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