The Insolvency Laws of the Netherlands

 About the Authors

            About the General Editors

            Preface

 

I.     BANKRUPTCY AND INSOLVENCY –  AN OVERVIEW

 

            A.  Public Attitude

            B.  General Overview/Governing Laws

            C.  Governing Law
II.    FORMS OF BUSINESS ENTITIES AND OBLIGATIONS

            A.   Business Entities

                  1. Types of Business Entities

                  2. Applicability of Insolvency Proceedings

            B.  Obligations

                  1. Unsecured Obligations

                  2. Secured Obligations
 

III.  CONSEQUENCES OF INSOLVENCY

 

            A.  Definition of Insolvency

            B.  Obligations of a Company in Financial Distress

            C.  Potential Liabilities of Directors, Management or Shareholders

                 1. Transactions within a Group of Companies

                 2. Payment to Creditors

                 3. Fraudulent Conveyance

                 4. Tort

                 5. Personal Liability for Tax and Social Securities

                 6. Criminal Liability

            D.  Liabilities Imposed on Lenders

            E.   Rehabilitation and Liquidation of an Insolvent Company

            F.   Availability for Other Business Problems

 

IV.   OUT OF COURT PROCEDURES

 

            A.   Informal Plan of Composition

            B.   Voluntary Liquidation

 

V.     REHABILITATION PROCEDURES – SUSPENSION OF PAYMENTS

 

             A.   Commencement of Proceedings

                  1. Request for Suspension of Payments Proceedings

                  2. Provisional Suspension of Payments

                  3. The Definitive Suspension of Payments

                  4. Appeal

             B.  Effects of the Commencement of the Suspension of Payments Proceedings

                  1. Loss of Right to Dispose of and Administer Property

                  2. Claims Not Affected by Suspension of Payments

                  3. Protection Against Ordinary Creditors’ Debt Collection Actions

                  4. Protection Against Hostile Creditors – Freeze

                  5. Effect on Pending Litigation

                  6. Effect on the Accrual of Interest

             C.  Administration of the Proceedings

                  1. The District Court

                  2. The Administrator

                  3. The Supervisory Judge

                  4. The Committee of Creditors

                  5. Estate Creditors

                  6. Secured Creditors

                  7. Preferential Creditors

                  8. Ordinary Creditors

                  9. Subordinated Creditors

                  10. Financing

             D. The Debtor’s Estate

                  1. The Estate

                  2. Consolidated Suspension of Payments Procedures

                  3. The Bodies of a Company

                  4. Effect on Contracts and Contractual Rights

             E. Increase of the Estate

             F.  Recognition of Claims and Distribution of Property

             G. Rehabilitation Plan

                  1. The Plan of Composition

                  2. Who May Participate in the Vote?

                  3. Acceptance of the Plan of Composition

                  4. Procedures for Voting

                  5. Ratification of the Plan of Composition

                  6. Legal Effect of the Ratification of the Plan of Composition

             H. Failure of Rehabilitation

             I.  Termination of the Suspension of Payment Proceedings and Its Effects

                  1. Plan of Composition

                  2. Termination Due to Lapse of Time

                  3. Debtor Is Able to Fulfill Its Payment Obligations

                  4. Conversion into a Bankruptcy Proceeding


 

VI. COMPANY LIQUIDATION PROCEDURE – BANKRUPTCY

 

           A.  Differences Between Liquidation Procedures and Rehabilitation Procedures

           B.  Commencement of Proceedings

                  1. Request for Bankruptcy Proceedings

                  2. Hearing of the Request

                  3. Opposition and Appeal

                  4. Publication of Bankruptcy Decision

                  5. How Long Does the Debtor Remain in Proceedings

            C.  The Effect of Commencement of Bankruptcy Proceedings

                  1. Loss of Right to Dispose of and Administer Property

                  2. Seizure of Assets for the Collective Creditors

                  3. Protection Against Creditor Actions – Freeze

                  4. Effect on District Court Proceedings

                  5. Effect on Liens and Injunctions

                  6. Effect on the Accrual of Interest

            D.  Administration of the Proceedings

                  1. The District Court

                  2. The Trustee

                  3. The Supervisory Judge

                  4. Committee of Creditors

                  5. Estate Creditors

                  6. Secured Creditors

                  7. Preferential Creditors

                  8. Ordinary Creditors

                  9. Subordinated Creditors

                 10. Financing

            E.  The Debtor’s Estate

                  1. The Estate

                  2. The Bodies of a Company

                  3. Termination of Contracts

                  4. Set Off

                  5. Right of Retention

                  6. Reservation of Title

                  7. Right to Seize Goods by the Tax Authority

            F.  Augmentation of the Estate

                  1. Fraudulent Conveyance

                  2. Liability of Managing Directors

            G.  Recognition of Claims and Distribution of Property

                  1. Notification of Creditors of the Need to File Their Claims

                  2. Submission of Claims

                  3. Verification Meeting

                  4. Distribution of Proceeds

                  5. Claims Not Entitled to Participate in the Proceeds           

            H.   Conversion of Bankruptcy Case to Rehabilitation

            I.    Termination of the Bankruptcy Case and Its Effect

                  1. Three Possible Termination Scenarios

                  2. Duration of a Bankruptcy Proceeding

 

VII.  EXTRATERRITORIAL JURISDICTION/ENFORCEABILITY

 

            A.   International Insolvency Law in the Netherlands

                  1. Principle of Universality with Respect to Dutch Insolvencies

                  2. Principle of Territoriality with Respect to Foreign Insolvencies 

                  3. European Regulation on Insolvency Proceedings

            B.   Recognition of Foreign Insolvency Proceedings

            C.   Ability of Foreign Estate Representatives to Sue or Assert Control Over Assets of the Estate

                   1. Appearance of Foreign Estate Representative in a Dutch Court

                   2. Appearance of Foreign Estate Officials in Dutch Courts to Start Affirmative Lawsuits

                   3. Local Attachments

                   4. Ancillary Proceedings

                   5. Request for Bankruptcy

            D.    Enforcement of Foreign Judgments and Court Orders in General

                   1. Enforceability of a United States Court Order

                   2. Enforcement

                   3. Impartial Relief

                   4. Foreign Order of Attachment

                   5. Lien or Security Interest

 

APPENDICES

 

            I.     Relevant Articles of the Dutch Bankruptcy Act

            II.    Relevant Articles of the Dutch Civil Code

 

Index

About the Authors:
Karen Harmsen is a Partner with Stibbe in Amsterdam where she specializes in property law, civil procedure, insolvency, restructurings and financing, as well as financial accounting and reporting. Her work includes advising on restructuring and insolvency matters as well financing constructions and securities, and undertaking legal procedures for liability, including directors liability and the performance and non-performance of contracts. 

Marius W. Josephus Jitta is a Partner with Stibbe in Amsterdam where he specializes in mergers, acquisitions, joint ventures, corporate restructurings and demergers. His work includes advising on venture capital and public and private offerings, assisting both listed and privately owned companies with acquisitions and divestments, and undertaking litigation, especially before the Enterprise Chamber of the Amsterdam Court of Appeal.

About the General Editors: 

Howard S. Beltzer is a Partner in Morgan Lewis & Bockius LLP's Business and Finance Practice and Co-Chair of the firmwide Restructuring Group.  He focuses his practice on major Chapter 11 proceedings and multinational bankruptcy cases.

Andrew P. DeNatale is a Partner with White & Case in New York. An authority on bankruptcy law, he has served as counsel to a wide range of clients, including institutional lenders, unsecured creditors committees, individual creditors (both secured and unsecured), and debtors.

Allan L. Gropper was appointed as a United States Bankruptcy Judge for the Southern District of New York in 2000. Prior to his appointment he had been a Partner of the law firm of White & Case. He represented clients in connection with many of the nation’s largest Chapter 11 cases, including Manville Corporation, Texaco, LTV Corporation, Federated Department Stores/Allied Stores Corp, Maxwell Communications Corp., MGM, United States Lines, Pan American World Airways, and Waterman Steamship Corp.