Introduction As of today, Tuesday 4 November 2014, the Single Supervisory Mechanism (the "SSM") will be in effect. From now on, all banks established in a Euro Member State will be subject to prudential supervision by the European Central Bank (the "ECB"). The SSM is applicable to all banks − approximately 4,900 − that are located in participating Member States. The ECB will exercise direct prudential supervision with respect to all 'significant' Dutch banks.

Under Dutch law, there is a high threshold for holding company directors personally liable. As long as a director is acting in that capacity, serious culpability (as opposed to merely ordinary culpability) is generally required. The high threshold is intended to prevent directors from being overly influenced by defensive considerations and applies to both their internal liability to the company and their external liability to third parties, such as individual shareholders or creditors.

by DLA Piper - Paul Hopman, Partner and Judith Atema, Senior Associate The duty of care of banks has been a hot topic in the Netherlands for quite some time. Although under Dutch law all contract parties have a regular duty of care towards each other, under certain circumstances a ‘special duty of care’ may apply for banks. This special duty of care applies only towards private persons and in case of high-risk investment products. Read more

Introduction On 1 October 2012, the financial assistance prohibition for BVs (private companies with limited liability) was repealed. Under the new regime, a BV is in principle free to provide financial assistance to third parties for the acquisition of its shares provided that the management board determines that the assistance is in the company's interest and subject to the usual restrictions (primarily the voidable preference rules and the ultra vires rules).

Supreme Court of the Netherlands 11 July 2014 (ABN AMRO vs Berzona) If a creditor wishes to have a debtor declared bankrupt in the Netherlands, Dutch law requires proof that the debtor has ceased paying his debts when they fall due. This test implies, according to long standing case law, that the debtor has at least two creditors, at least one of whom has a claim which is due and payable.

Last Friday the proposal for the Act on the Remuneration Policy of Financial Undertakings was submitted. Compared to the consultation version that was previously published, only a limited number of amendments have been made. Click here to read more

The Dutch Bankruptcy Act (Faillissementswet) first came into force on 1 September 1896, making it relatively old for a Bankruptcy Act. In 2011 the legislator decided that a new draft of the Dutch Bankruptcy Act was not a priority and there was no need to adopt amendments. Surprisingly, the Dutch legislator announced in 2013 that a new bankruptcy law was in fact necessary and that the “continuity of companies” was a priority.

Steven Kroesbergen discusses the guarantee function of the EIR provisions applicable to set-off.

On 17 December 2013 the Financial Markets Amendment Decree 2014 (the "Amendment Decree 2014"), containing amendments to a number of existing decrees, was finally published. Among other things, the Amendment Decree 2014 imposes the long-announced ban on inducements for investment firms. In its final form, the inducement ban deviates in two respects from the draft version submitted by the Dutch Minister of Finance to the market for consultation on 3 April of this year. Firstly, the ban is limited to investment services to non-professional clients.

At the very end of 2013, on 17 December, the final version of the Financial Markets Amendment Decree 2014 (the “Amendment Decree 2014”) has been published. The final Financial Markets Amendment Act 2014 (the “Amendment Act 2014”) was published only slightly earlier, on 5 December, in the Bulletin of Acts and Decrees. In this newsletter we will discuss a number of important new rules that have been included in the Amendment Act 2014 and the Amendment Decree 2014.