Latest updates

Volcker/Vickers rules on separation of activities for Dutch banks?
  • Netherlands
  • 05 April 2012

In a recent letter to Parliament, the minister of finance outlined the possible introduction of legislation that would force banks to separate their commercial banking, investment banking and proprietary trading activities if they were combined in a single banking organisation or group. The plan follows the adoption of similar rules in the United Kingdom and the United States.

Looking ahead: the 2012 legislative and compliance programme for banks
  • Netherlands
  • 16 December 2011

There are likely to be a number of key developments in legislation and compliance to be handled by banks in the Netherlands in 2012. For example, at the start of the year a number of amendments to the Act on Financial Supervision and certain lower government decrees will enter into force to meet the implementation requirements of the EU Capital Requirements Directives II and III.

Towards migration of the EU Capital Requirements Directive IV
  • Netherlands
  • 04 November 2011

With the introduction of the revised EU Capital Requirements Directive (CRD IV), European banks and investment firms will be subject to a new set of capital requirement rules. In order to address uncertainties arising from the fact that CRD IV has not yet been adopted and transposed into the law of the EU member states, the Dutch Central Bank has published further guidance on the policies in this area.

The development of liquidity risk management
  • Netherlands
  • 26 August 2011

The Regulation of the Dutch Central Bank Liquidity Act on Financial Supervision 2011 represents a significant step forward in shaping comprehensive regulations for liquidity risk management in the Netherlands. According to the Dutch Central Bank, it was introduced to address the fact that although certain assets were appraised as sufficiently liquid, the banks did not actually have the requisite liquidity when markets collapsed.

Effects of termination of credit facilities on banks and borrowers
  • Netherlands
  • 05 February 2010

Due to an increased need for liquidity and deteriorating market conditions for the majority of borrowers, banks have become increasingly focused on limiting their exposure to badly performing borrowers. As a result, the premature termination of facilities, usually initiated by banks as a last resort, has become a feature of discussions between banks and borrowers.

New Guidance on Enforcement of Pledge over Shares
  • Netherlands
  • 13 November 2009

For the first time, a Dutch court has approved a refinancing structure by way of an enforcement sale that was pre-agreed by the pledgee, the pledgor and the buyer, although a junior creditor opposed the transaction. The structure confirms the opportunity for other international groups and their lenders to refinance senior debt and continue operations without junior debt.

Regulator Imposes Administrative Fine on Postbank NV
  • Netherlands
  • 17 April 2009

Pursuant to Section 4.23(1) of the Financial Supervision Act, a mortgage adviser must inform himself or herself of the consumer's financial position, knowledge, experience, goals and willingness to accept risks, and any advice must be based on this information. In a recent case the Authority for the Financial Markets ruled that Postbank NV had failed properly to inform itself of consumers' financial situations.

Court Considers Scope of Duty of Care between Banks and Borrowers
  • Netherlands
  • 14 November 2008

It is established case law that a bank has a special duty of care towards private individuals. The scope of the duty of care is determined by the particular circumstances of the case, including the nature of the agreement between the bank and the borrower and the degree of expertise of the borrower. The Utrecht District Court recently provided further insight into the scope of the duty of care.

Prohibitions against Conducting Banking Activities and Holding Funds from Public
  • Netherlands
  • 08 August 2008

A recent Trade and Industry Appeals Tribunal decision confirms that it is almost impossible to raise funds from the public without a banking licence. Informal environments such as churches and sports clubs will rarely constitute the requisite 'restricted circle' between borrower and lender. The decision also confirms that there is no easy way to avoid orders for periodic penalty payments.

New Supervision Regime for Finance Companies
  • Netherlands
  • 27 April 2007

The legislation on the system of financial supervision has undergone a drastic change. The introduction of the Financial Supervision Act is the result of a major operation which constitutes the largest legislation reform in the Netherlands since World War II. This update provides a brief overview of the banking rules and the position of finance companies in the Netherlands.

Prejudice to Creditors When Creating Security Rights
  • Netherlands
  • 26 May 2006

The Supreme Court has recently ruled that the granting of secured credit may, under certain circumstances, prejudice unsecured creditors of the late bankrupt and may therefore be nullified. When granting secured credit, banks must pay special attention to whether the borrower might become insolvent.

Supreme Court Rules on Enforcement of Secured Claims
  • Netherlands
  • 31 March 2006

The Supreme Court has ruled that a judgment creditor that has attached a receivable may enforce its claims towards the debtor by collecting the receivable of the debtor towards a third party. If the attached receivable is secured by a right of mortgage, the judgment creditor benefits from the right of priority pursuant to the right of mortgage and its claims rank above the unsecured claims of third parties.

Supreme Court Rules on Attachment of Unused Credit
  • Netherlands
  • 29 July 2005

The question of whether unused credit can be made subject to attachment - in particular, a prejudgment attachment - has been the subject of heated discussion. The Supreme Court recently ruled on this issue for the first time and held that unused credit cannot be attached.

Investment Institutions: The Forgotten Rule
  • Netherlands
  • 15 April 2005

Certain institutions are now subject to extended rules of conduct relating to the Securities Act. These include credit and other financial institutions that are not subject to the obligation to obtain a licence under the act because their business does not qualify as the business of a securities institution, or which are exempt under the Credit Institutions Supervision Act.

Policy Rule 2005 on Key Concepts of Market Access
  • Netherlands
  • 04 March 2005

A new policy rule has amended a 2002 policy rule drawn up by the Netherlands Central Bank which, following consultation with the Ministry of Finance, provided a detailed interpretation and definition of some relevant concepts of the Act on the Supervision of the Credit System 1992 and its Exemption Regulation.

Implementation of EU Collateral Directive
  • Netherlands
  • 28 January 2005

The EU Directive on Financial Collateral Arrangements has not yet been implemented in the Netherlands due to objections raised by the First Chamber's justice committee, mainly with regard to material changes to Dutch property law and the Bankruptcy Act. However, the minister of justice is convinced that implementation of the directive will not give rise to any problems.

Financial Assistance - A Landmark Decision
  • Netherlands
  • 01 October 2004

The Supreme Court has confirmed that security provided to third-party lenders in a debt pushdown falls outside of the scope of the financial assistance rules and that a target company can grant security to a bank with respect to a loan it obtains to lend to its acquirer. However, financial assistance rules in the Netherlands will continue to be a source of uncertainty.

Supervision of Trust Offices Becomes Effective
  • Netherlands
  • 19 March 2004

Pursuant to the Act on the Supervision of Trust Offices, trust services may only be provided under a licence issued by the Dutch Central Bank. The conditions imposed on this licence relate, among other things, to the integrity of the persons having an interest in or control over the trust office and to the administrative organization of the trust office.

Bank Loan Financial Assistance Clarified
  • Netherlands
  • 06 February 2004

While the Dutch Civil Code prohibits a private company from providing security with a view to the acquisition of its shares, a recent court judgment indicates that bank loans to such a company should be treated separately from other financial assistance issues. The decision means banks are likely to treat these facilities less cautiously in future.

Exemption Regulation Amendment Complicates Lending
  • Netherlands
  • 28 March 2003

The definition of 'professional market parties' in the Exemption Regulation issued in relation to the Supervision of Credit Institutions Act has been widened to resolve complications in securitization. However, the amended definition may mean that borrowers who originally borrowed from a professional may be in breach of the act if their loan is later assigned to a non-professional.