Credit: Photo: Flip Franssen

How the Netherlands facilitates global warfare

By Jochem van Staalduine, Gidi Pols, | 30 June, 2021

Dozens of large arms manufacturers use the county as a conduit for financing their sales deals. 

The Netherlands plays an important role as a financial hub in the international arms trade. The Investigative Desk took a closer look at the fifty largest arms manufacturers in the world, looking for fiscal constructions and money flows to tax havens. By combining data from annual reports with data about arms deals from Swedish peace organisation SIPRI and its Dutch counterpart PAX, it was possible to link money flows to actual arms sales.

Half of the fifty manufacturers have one or more branches in the Netherlands. These include letterbox companies, factories or offices with dozens of employees. Many of the manufacturers are industrial conglomerates which also produce non-military goods such as elevators, alarm systems or air conditioners.

Eight conglomerates send large sums of money to or through the Netherlands: French-German tank builder KNDS, US companies General Electric, Honeywell and Raytheon Technologies, and aircraft manufacturers Boeing and Airbus. BAE (UK) and Leonardo (Italy) are active in the Netherlands as shareholders of rocket manufacturer MDBA. In total, the Dutch subsidiaries of these eight manufacturers have transferred €10.3 billion to their shareholders in the past five years. The majority of these payments were dividends and interests (on intra-company loans).

Some of these multinationals have settled in the Netherlands for tax reasons. General Electric, for example, uses the country as a conduit to send profits to Bermuda, where no profit tax is levied. A Dutch subsidiary of Raytheon Technologies sends millions of dollars in dividends to Gibraltar for the same reason. Other companies choose the Netherlands because of its flexible legal regulations.

Read the full article in Dutch magazine De Groene Amsterdammer (in Dutch).

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