Lawyers and Notary in Leiden and The Hague

The Dutch Corporate Governance Code was first adopted in 2003. The Code contains principles and best practice provisions that regulate the relationship between the management board, the supervisory board and the shareholders of a company. The Code applies to all companies with registered offices in the Netherlands whose shares or depositary receipts for shares have been admitted to trading on a regulated market or a comparable system and to all large companies with registered offices in the Netherlands (balance sheet value > € 500 million) whose shares or depositary receipts for shares have been admitted to trading on a multilateral trading facility or a comparable system.

Many other companies use the Code as a source of inspiration and voluntarily choose to apply the Code. Throughout the years, the Code has increasingly gained an important position. In the eyes of the Supreme Court of the Netherlands, the Code is an expression of the general legal belief prevailing in the Netherlands. Therefore, in any possible lawsuit – including lawsuits against companies to whom the Code does not apply – value might be assigned to the principles and best provisions in the Code. It is therefore important for all company directors to be aware of those principles and best practice provisions.

Just a few months ago, the responsible committee published an updated version of the Code. The most important amendments are about sustainable long-term value creation, the stakeholders of the company and diversity and inclusion.

The management board of the company is responsible for long-term value creation by the company. This means that the board is expected to take into account the impact of the actions of the company on people and the environment. To that end, de board weighs the relevant interests of the stakeholders of the company. With regard to sustainable long-term value creation, the Code mentions that awareness and anticipation of developments in new technologies is required. This includes cybersecurity, data protection and a responsible use of new technologies.

A stakeholder is an individual or organisation who can influence or is being influenced by the functioning of the company. To ensure that the interests of the stakeholders are considered, the management board needs to draw up an outline policy for effective dialogue with the stakeholders with regard to at least the sustainability aspects of the company’s strategy. The company needs to facilitate this dialogue, unless it is not in the interest of the company.

Companies need to draw up a policy on diversity and inclusion for the entire company. The policy should contain specific, appropriate and ambitious targets in order to achieve a good balance in gender diversity and other aspects that are relevant for the company. This applies to the composition of the management board, the supervisory board and a category of employees in managerial positions. The category of employees needs to be determined by the management board.

In short: besides the law, it is important to be aware of the significance of the Corporate Governance Code and its contents. Would you like to know more about the Dutch Corporate Governance Code or do you have any questions about the aforementioned?

Feel free to contact Eveline Bakker, attorney-at-law, or Jarno de Graaf, legal assistant

On the first of January 2021 the Financial Restructuring Act, known in Dutch as the Wet Homologatie Onderhands Akkoord (hereafter: WHOA), entered in to force. The goal of the WHOA is to prevent bankruptcies of successful yet almost insolvent business entities. Expectations were high, as experts considered the WHOA as a major development in the Dutch insolvency practice. After a year it is time to evaluate, what were the effects of the WHOA, which developments stood out, and did it fulfil the expectations?

The WHOA proceedings

The WHOA enables businesses that are in financial distress, but nevertheless can survive after a debt restructuring, to offer a reorganization scheme to its creditors and shareholders in order to avoid an impending bankruptcy. It is comparable to a Chapter 11 or Scheme of arrangement procedure. If a company is still (partly) viable and the restructuring plan is ratified, the Court can declare the reorganization scheme binding to all creditors of the company, even to the ones who refuse to cooperate.

The impact of the WHOA in 2021

During the first 9 months of the WHOA no less than 134 initial statements were filed at several Courts across the Netherlands, with a request to start a procedure. The Court published 81 rulings, from which 10 reorganization schemes got approved and 5 got denied.

Although, it is difficult to draw a conclusion from these figures, we see that depositing a statement is not a guarantee for a successful approval. The Court will be very precise and strict in the examination of a reorganization scheme. Given that the approval will restrict the right of the creditors. Therefore, it is important to prepare a reorganization scheme with careful and professional attention. The debtor must thoroughly inform the creditor about his position, the financial situation, and the necessity of restructuring the company. Only then will the Court approve a scheme and bind the creditors to it.

On the other hand we see that a ‘cooling off period’ is granted relatively often. From the 31 request, 25 were granted. During this period no creditor can take enforcement action, receive any payments or set off.

 Recognition of the WHOA in Europe

Due to a recent change in the European Union (EU) Insolvency Regulation, the WHOA has now been admitted to the list of insolvency proceedings. This means that a WHOA procedures (a public procedure)  will have jurisdiction in other European member states, binding all European creditors to the arrangements of the reorganization scheme. On the other hand, foreign group entities with at least one entity based in or with close ties to the Netherlands can also use a WHOA procedure for their reorganization.


In the end it is fair to say that the WHOA has not, yet, made the impact as was expected. However, this could very well be calm before the storm. When the pandemic is over, companies could realize that restructuring is necessary and also the Europeanization of the WHOA could be a huge influence in the coming years. At least for now we can conclude that the WHOA is not an easy instrument to use. A simple deposition of your debts will not be enough. Therefore we advise to always come with a careful and well prepared plan in order to have a successful procedure.

Would you like to know more about the WHOA or do you have any questions about the aforementioned?

Feel free to contact Eveline Bakker, attorney-at-law