Extension of the Temporary Act COVID-19 Justice and Security

March 25, 2021 – The Temporary Act COVID-19 Justice and Security (Tijdelijke wet COVID-19 Justitie en Veiligheid, the “Temporary Act“) has been effective in Dutch corporate law since March 2020, and has since then been extended multiple times. In this alert we will give you an update on the current status of the Temporary Act as well as a short summary of the changes the Temporary Act made to Dutch corporate law. For the avoidance of doubt, please note that the Temporary Act covers multiple legal areas, but we will only focus on those that impact corporate law.

Expiration and extension

As previously noted, the Temporary Act entered into force on April 24, 2020 but works retroactively from March 16, 2020. Originally the Temporary Act was supposed to expire on September 1, 2020. Due to the ongoing COVID-19 measures, the Dutch government has invoked the integrated extension clause five times over the last year (each time with an extension of two months), with the latest expiration date on June 1, 2021.

The Dutch government is aware of the fact that extending the Temporary Act with two months at a time could lead to uncertainty which makes the planning and convening of a general meeting problematic. To provide more certainty in this respect, the government therefore intends to give at least two months’ notice when provisions of the Temporary Act will not be extended again. In addition to this, the government has also already stated its intent to extend the period of validity until August 1, 2021. However, this remains subject to change.

As an exception to this, we note that the provisions on directors’ liability included in the Temporary Act, are set to expire on September 1, 2023 instead of June 1, 2021. This is related to the period for which claims based on Article 2:138/248 of the Dutch Civil Code can be submitted.

Changes to Dutch corporate law

Under the Temporary Act the following changes / additions apply to Dutch corporate law:

  1. Electronic general meetings

The management board of a legal entity can decide to make general meetings accessible through electronic means of communications only, with physical access being prohibited. Voting and speaking at the general meeting will also be conducted through electronic means of communication, whereby the management board can decide that votes may be cast by electronic means or in writing prior to the meeting. The management board has to include the measures in the convocation. If the board has already convened the meeting without including the intended measures in the convocation, the board can still take these measures until 48 hours before the start of the meeting.

The Temporary Acts gives the management board and supervisory board the power to deviate from statutory provisions and similar provisions of articles of association regarding physical meetings.

  1. Extension of drawing up annual accounts

Based on the Temporary Act the management board, instead of the general meeting, can decide to extend the period for drawing up the annual accounts up to ten months after the end of the fiscal year. However, the latter does not apply to listed companies that are subject to the Financial Supervision Act (Wft). Those companies are excluded since the extension of this period could impact their position on the market.

  1. Directors liability

If, in case of bankruptcy of an NV or a BV, the management board failed to meet the obligation to publish the annual accounts, but it can demonstrate that this was due to the outbreak of the COVID-19 pandemic, the Temporary Act states that this failure to publish will not be taken into account when determining directors’ liability.

For more information regarding the Temporary Act, we refer to our previous alert from April 22, 2020.

Should you have any questions regarding the Temporary Act and/or the impact for your business, please do not hesitate to contact us.

Martina Priekaar and Lotte Smit

Martina PriekaarLotte Smit


Brexit – choice of law, jurisdiction of courts and enforcement of judgments – 16 February 2021

Since the 1st of January, 2021, the United Kingdom has left the European Union. As a result, the UK is no longer part of the internal market of the EU, many EU-conventions are no longer applicable for the UK and the EU-UK Trade and Cooperation Agreement has entered into force (the “Brexit-Agreement”). In this blogpost we will give a short summary of the impact of the Brexit in respect of (i) the choice of law, (ii) jurisdiction of courts (iii) and the enforcement of UK judgments in the Netherlands.

On January 29, 2020 the UK and the EU have entered into a withdrawal agreement (the “Withdrawal Agreement”). Under the Withdrawal Agreement, many regulations and conventions remained to be applicable and valid until December 31, 2020. This to ensure that no major changes would occur prior to the UK actually leaving the EU. As such, in respect of choice of law, jurisdiction of courts and the enforcement of UK judgments in the Netherlands, not much has changed prior to that date. Unfortunately, the Brexit-Agreement does not contain any language regarding the below subjects and some issues are still to be determined.

Choice of law

The rules to determine which country’s laws apply to a dispute or an agreement, are found in the Rome I and Rome II regulations (the “Rome Regulations”). Following the Withdrawal Agreement, the Rome Regulations continued to apply in respect of the UK until December 31, 2020. Since January 1, 2021 the UK is no longer a party to the Rome Regulations. Fortunately, for the Netherlands this does not affect the choice of law clauses, given the fact that the relevant provisions of the Rome Regulations are not bound by reciprocity. This means that the courts in the Netherlands can apply the Rome Regulations without the relevant (chosen) country being a party to the Rome Regulations. As a result, in the Netherlands, the applicable law clauses will continue to apply the same way as prior to the Brexit.

Jurisdiction of courts

The validity of choice of court clauses can within the EU be found in the Brussels I Recast Regulation (the “Brussels I Recast”). Also, the rules to determine the jurisdiction in the event no specific court has been appointed, can be found in the Brussels I Recast. Since January 1, 2021, the UK is no longer a party to the Brussels I Recast and therefore other regulations have to close the gap that Brussels I Recast leaves. We note that for court proceedings which started prior to January 1, 2021, the Brussels I Recast will continue to apply.

The Lugano Convention

The Lugano Convention will be a good alternative to the Brussels I Recast. The Lugano Convention is similar to the Brussels I Recast and is already applicable in relation to the EU and Iceland, Norway and Switzerland. The UK has applied to become a party to the Lugano Convention, but the EU has yet to approve this request. Since the UK has applied to join the Lugano Convention in April, 2020 and the contracting parties have one year to respond to the application, the EU must respond in the next three months. Iceland, Norway and Switzerland have already approved the application.

The Hague Choice of Court Convention (the “Hague Convention”)

In addition to the application to the Lugano Convention, the UK has become a party to the Hague Convention in September 2020, which became effective on January 1, 2021. The Hague Convention requires the designated courts in exclusive jurisdiction agreements to hear the case and therefore closes part of the gap left by Brussels I Recast. The main difference between the Hague Convention and the Brussels I Recast is that for the Hague Convention to be applicable, the jurisdiction clause has to be an exclusive jurisdiction clause.

As the UK was already a party to the Hague Convention prior to January 1, 2021, but as an EU-member state instead of on its own, there is ongoing discussion about the Hague Convention being applicable to agreements being signed prior to January 1, 2021. Contracting parties which have existing exclusive jurisdiction clauses which they would like to continue to rely upon may consider re-agreeing those clauses now, perhaps by way of a supplemental agreement.

Enforcement of judgments

The Brussels I Recast will continue to apply to the enforcement of judgments given in proceedings which started prior to January 1, 2021. For proceedings starting after this date, the enforcement mechanisms that were in place will cease to apply to the UK. Some kind of protection could be sought in the UK’s application to the Lugano Convention. As this has yet to be approved, in the meantime the Hague Convention can provide some comfort in the enforcement of judgements when an exclusive jurisdiction clause is in place.

Until the EU will provide clearance on the Lugano Convention, parties looking to enforce a UK judgment in the Netherlands, without the possibility of the Hague Convention being applicable (i.e. there is no exclusive jurisdiction clause), may be able to rely upon the bilateral treaty between the Netherlands and the UK. This treaty is executed in 1967 and requires additional actions to be taken before enforcement is possible.

We will closely monitor the future development in respect of the above mentioned topics. Should you have any questions in the meantime, please do not hesitate contact us.

Eva Klein Obbink

Eva Klein Obbink

Lotte Smit

Lotte Smit