The Restructuring Review: Netherlands

Footnotes

1 Paul Kuipers is a partner at Linklaters LLP.

2 Such prior approval is governed by Article 25 of the Works Council Act.

3 Article 176 of the Bankruptcy Code.

4 Such dismissal may occur pursuant to Article 40 of the Bankruptcy Code. Cf. Supreme Court 2 June 2017, JOR 2017/248 (DA).

6 See further on available insolvency and restructuring procedures: Dennis Faber and Niels Vermunt, 'National Report for the Netherlands', in: Dennis Faber et al. (eds), Commencement of Insolvency Proceedings, Oxford International and Comparative Insolvency Law Series, Volume 1, Oxford University Press 2012, page 428 ff.

7 Article 232 of the Bankruptcy Code, Article 7:663 and Article 7:666 of the Civil Code. Following the aforementioned decision of the ECJ concerning the Estro pre-pack, such rules may also apply in case of a going-concern sale implemented in bankruptcy proceedings (prepared as a pre-pack).

8 Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No. 1093/2010 and (EU) No. 648/2012, of the European Parliament and of the Council.

9 Regulation (EU) No. 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No. 1093/2010.

10 Article 23 of the Bankruptcy Code.

11 Mortgages cannot be granted in advance over future immovable assets, registered ships and registered aircraft. See Articles 3:97(1) and 3:98 of the Civil Code.

12 Articles 23 and 35(2) of the Bankruptcy Code.

13 Article 68(1) of the Bankruptcy Code.

14 Article 57(1) of the Bankruptcy Code.

15 Article 63a of the Bankruptcy Code.

16 Article 58(1) of the Bankruptcy Code.

17 Articles 58(1) and 182 of the Bankruptcy Code.

18 It follows from Article 132(2) of the Bankruptcy Code and Article 483e of the Civil Procedure Code that security can only be enforced during insolvency proceedings for (1) pre-commencement secured claims; and (2) post-commencement secured claims which originate from a pre-commencement legal relationship. Cf. also Supreme Court 16 October 2015, JOR 2016/20 (DLL/Van Logtestijn).

19 Article 6:162 of the Civil Code.

20 Supreme Court 6 October 1989, NJ 1990, 286 (Beklamel).

21 Supreme Court 18 February 2000, JOR 2000/56 (New Holland Belgium/Oosterhof) and Supreme Court 8 December 2006, JOR 2007/38 (Ontvanger/Roelofsen).

22 Cf. e.g. Supreme Court 26 March 2010, JOR 2010/127 (Zandvliet/ING). See also recently on personal liability of directors for procuring selective payments of certain creditors in the twilight zone preceding formal proceedings: Supreme Court 17 January 2020, JOR 2020/55 (Ingwersen q.q./Source BV).

23 Article 2:138(1) and Article 2:248(1) of the Civil Code regarding public and private limited companies. Such improper management must have occurred within three years of the commencement of the bankruptcy proceedings. See Article 2:138(6) and Article 2:248(6) of the Bankruptcy Code. The scope of the provision is extended to shadow directors pursuant to Article 2:138(7) and Article 2:248(7) of the Civil Code.

24 Article 2:10 of the Civil Code.

25 Article 2:9(1) of the Civil Code.

26 Other circumstances that may be relevant include the nature of the company's activities and corresponding risks, the allocation of tasks within the board of directors, possible guidelines applicable to management, the information available to directors at the time of scrutinised actions and decisions, and the knowledge and prudence that may generally be expected of a director who is sufficiently prepared and performs his or her task in a diligent manner. See Supreme Court 10 January 1997, JOR 1997/29 (Staleman/Van de Ven).

27 Supreme Court 10 December 1976, NJ 1977, 617 (Eneca) and Supreme Court 8 July 2005, JOR 2005/230 (Van Dooren q.q./ABN AMRO Bank II).

28 Article 42 of the Bankruptcy Code.

29 Cf. Supreme Court 22 December 2009, JOR 2011/19 (ABN AMRO Bank/Van Dooren q.q. III).

30 Article 43 of the Bankruptcy Code.

31 Knowledge of the mere likelihood that insolvency proceedings may be opened is insufficient to meet this requirement. See Supreme Court 16 June 2000, NJ 2000, 578 (Van Dooren q.q./ABN AMRO Bank I).

32 Supreme Court 24 March 1995, NJ 1995, 628 (Gispen q.q./IFN) and Supreme Court 20 November 1998, JOR 1999/19 (Verkerk/Tiethoff q.q.).

33 Article 54(1) of the Bankruptcy Code.

34 Supreme Court 7 October 1988, NJ 1989, 449 (AMRO/THB).

35 Cf. Supreme Court 23 November 2018, JOR 2019/27 (Eurocommerce).

36 Supreme Court 4 October 2019, JOR 2019/269 (Ruwaard van Putten Hospital).

37 Supreme Court 19 April 1996, JOR 1996/48 (Maclou).

38 Article 16 of the Commercial Code and article 7A:1655 of the Civil Code.

39 Article 51 (2) Civil Procedure Code.

40 Article 4 (3) of the Bankruptcy Code.

41 Article 18 of the Commercial Code.

42 Cf. e.g. Supreme Court 3 December 1971, NJ 1972, 117 (Hotel Jan Luyken); Supreme Court 6 February 2015, JOR 2015/181 (Bepro); and Supreme Court 2 June 2017, JOR 2017/249 (X/A).

43 Supreme Court 19 April 2019, JOR 2019/173 (UWV/X).

44 Article 53 of the Bankruptcy Code.

45 See Supreme Court 15 November 2019, JOR 2020/22 (X/Y).

46 Article 3:279 of the Civil Code.

47 Articles 21(2) and 22(3) of the Tax Collection Act.

48 A general tax preference would remain pursuant to Article 21(1) of the Tax Collection Act. However, such general tax preference is subordinated to the senior ranking of the pledgee by virtue of Article 3:279 of the Civil Code.

49 Article 22bis of the Tax Collection Act imposes a duty on the pledgee to first notify the tax authorities of its intention to lease the debtor's premises (or to perform any other acts which would frustrate the special tax preference). Such acts can only be performed after four weeks following the date on which notification was served. In the meantime, the tax authorities are entitled to take any steps necessary to enforce their senior preferential status.

50 Supreme Court 21 June 2019, JOR 2019/262 (Houtman q.q./Rabobank).

51 Supreme Court 22 December 1989, NJ 1990/661 (Tiethoff q.q./NMB).

52 See on the position of the secured creditor as a separatist in insolvency proceedings above at Section II.ii.

53 Cf. e.g. Supreme Court 14 January 1983, NJ 1983, 597 (Peeters q.q./Gatzen); Supreme Court 21 December 2001, JOR 2002/37 (Lunderstädt/De Kok); Supreme Court 21 December 2001, JOR 2002/38 (SOBI/Hurks).

54 Cf. Supreme Court 16 September 2005, JOR 2006/52 (De Bont/Bannenberg q.q.).

55 Hoge Raad 28 June 2019, JOR 2019/263 (Liquidators Indover/Bank Indonesia).

56 ECJ 6 February 2019, C-535/17 (NK v BNP Paribas Fortis).

57 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ 2012, L 351/1. Considering the timing of the proceedings, the case was formally decided on the basis of the Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ 2001, L 12/1. The ECJ ruling can be deemed to apply mutatis mutandis to the Brussels I Regulation (recast).

58 Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings (recast), OJ 2015, L 141/19.

59 Depending on the circumstances of the case, the action of the liquidator may have priority over a competing action of the relevant creditor. Cf. Supreme Court 21 December 2001, JOR 2002/37 (Lunderstädt/De Kok).

60 Converted into bankruptcy proceedings on 2 January 2020.

61 Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings.

62 Council Regulation (EC) No. 1346/2000 of 29 May 2000 on insolvency proceedings, OJ 2000, L160/1, Directive 2001/17/EC of the European Parliament and of the Council of 19 March 2001 on the reorganisation and winding up of insurance undertakings, OJ 2001, L110/28 and Directive 2001/24/EC of the European Parliament and of the Council of 4 April 2001 on the reorganisation and winding up of credit institutions, OJ 2001, L125/15.

63 See Supreme Court 2 June 1967, NJ 1968, 16 (Hiret/Chiotakis); Supreme Court 31 May 1996, JOR 1996/75 (Coppoolse/De Vleeschmeesters); Supreme Court 24 October 1997, JOR 1997/146 (Gustafsen q.q./Mosk); Supreme Court 19 December 2008, JOR 2009/94 (Yukos I) and Supreme Court 13 September 2013, JOR 2014/50 (Yukos IV).

64 Supreme Court 18 January 2019, JOR 2019/165 (Yukos).

65 Supreme Court 26 September 2014, JOR 2014/350 (Gazprombank/Bensadon).

66 [2012] EWHC 2944 (Comm); recognition issues do not appear to have been raised in a prior case of a Dutch company proposing a scheme, Re DAP Holding NV [2005] EWHC 2092 (Ch).

67 Re Magyar Telecom [2013] 3800 (Ch).

68 Regulation (EU) No. 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ 2012, L 351/1.

69 Regulation (EC) No. 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations, OJ 2008, L177/6.

70 Directive (EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 2017/1132 (Directive on restructuring and insolvency), OJ 2019, L172/18.

71 Proposal for a Directive of the European Parliament and of the Council on credit servicers, credit purchasers and the recovery of collateral, COM(2018)135.

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