Aruba) Tackling illegal business operations

A taskforce brought to live to fight crime

To have an idea or a dream turned into a business is a significant achievement. It takes planning, patience and courage. A business needs to adhere to certain legal requirements. To assess the compliance and target illegal businesses a taskforce called ‘Afpakteam’ has been formed.

The enforcement of the Afpakteam (Taskforce)
Since 1 February 2017 a taskforce has been installed to fight crime and to take goods from persons who are suspected of having obtained them illegally. This team is a collaboration between several authorities under which the OM (Public Ministry), Customs, FIOT (Tax Intelligence and Investigation Team), the Dutch FIOT, KPA (Aruba Police Force), Warda Nos Costa, MOT (Reporting Point Unusual Transactions) and RST (Criminal Investigation Department). The Afpakteam has been very active since then, successfully addressing illegal business operations. A visit from the Afpakteam/Taskforce is not something a business wants and it can be avoided.

A few things you might want to avoid
There might be reasons to pursue doing business illegally but there are plenty of motives why this is not encouraged. Incorrect trends of doing business and misinformation can get you in trouble. Two particular situations where people, knowingly or not, get involved in a business which could get them in trouble are so-called “stromanschap” (a person acting as a front in order to start a company)” structures and running online businesses on social media. ‘Stromanschap’ is a situation where a person who is not allowed to start a business for whatever legal reason or requirement, acquires another to stand-in and get certain rights otherwise not granted. For example, a foreigner who is unable to get a permit due to the requirement that only locals are allowed to have a director’s license. This situation is known to have caused many shameful and unpleasant situations for the ‘stroman/front man’, who will be the one held accountable for the business and other requirements, such as tax debts. Usually a stroman/front man is promised a payment for helping out, but the risk that comes with it is usually not comparable. Therefore it is not advised to participate in such a structure.

Online businesses are also required to register and obtain the needed permits similar to traditional stores. Due to the accessibility and ease of the social media in combination with lack of understanding perhaps, many of these businesses do not register. This is an illegal activity and unfair competition for compliant businesses. With the implementation of new laws in the works for online business operations, it is recommended to have your business and investment organized according to the law.

By not complying with the legal business requirements, you are risking certain consequences which would put a stop to the way you are doing business and touch your profits. Consequences of getting caught include:

•Forced to close and cease operations;
•Fines and fees for not having adequate licenses;
•Possibility of lawsuits by victims of fraudulent activities;
•Loss of reputation and business  partners or customers who will not  invest the same level of trust as before. 

What are the formalities you need to keep into consideration?
It all depends on the nature of your business but the essence is as follows:
Registration at KvK – as decreed by law (stipulated in the Trade Registry Ordinance, art. 4) an established company must be registered at the Chamber of Commerce and pay an annual fee. Failure to comply can result in a fine due to non-compliance. Being registered has its benefits for the business depending on its level of maturity. The Chamber consults its database to seek opportunities for local entrepreneurs. The companies are continuously informed about events, trade missions and seminars.

Permit documentation of the Department of Economic Affairs and DIMAS – Depending on the type of business, a company is also required to have certain permits. This is stipulated in the Business Licensing Ordinance. As stipulated in article ten, failure to comply could result in detention up to six months or a fine of no less than AWG 2000 as punishment to intentionally make an incorrect or incomplete declaration to obtain a permit. In case you have employees from abroad, you also are required to have the work permits of DIMAS (Department of Integration, Management and Admission of Foreigners). DIMAS imposes a fine on the employer who is guilty of the violation of work permit requirements. Depending on whether the employer is a legal entity or a natural person, the amount of the fineable event is set. Fines go up to AWG 25,000 per punishable offense per person for a legal person or a maximum of AWG 10,000 for each offence per person for the benefit of a natural person. 

Compliance with the Tax Department – It is important that the company meets its tax obligations on time. Non-compliance will lead to fines and tax recovery measures. By paying taxes you are contributing to Aruba’s economy. Government tax earnings are allocated to pay debts and it’s in the best interest of the general public. 

Business insurance – No matter the size, your business is a big investment and you want to have your investment properly covered. Insuring your business gives a little peace of mind because you can guarantee the continuity of your business against risks if any unpleasant situation should occur.

We like to see businesses grow and become successful. Have all your documentation in place and avoid getting involved with the Afpakteam/Taskforce. Visit the Aruba Chamber of Commerce and Industry, send an email to or contact the Department of Economic Affairs, Commerce and Industry at  for more information regarding legal requirements for your particular business inquiry.

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