How do Dutch laws and regulations regulate M&A transactions?
In the Netherlands there aren’t specific M&A statutes or codes. Parties are free to determine their own rules for acquisition. This could include provisions regarding due diligence, knowledge qualifiers and confidentiality. For financial sector companies that have an address registered in the Netherlands, the Merger code and the Public Takeover Bid Decree contain certain guidelines.
M&A deals in the Netherlands are typically share deals. acquisitions of shares) and legal mergers or demergers (where all or a portion of the liabilities or assets of a company that ceases to exist are acquired and taken over by a different company). In the event that an public M&A transaction is involved, the Dutch works council law or (in the absence of such a body) the laws of the country of incorporation will dictate the procedure.
Individual shareholders, whether they hold the majority or minority interest in the target company, are entitled to certain rights under Dutch law and the company’s articles of association. The target board has the obligation of providing sufficient details to all shareholders who are interested on the M&A deal in order for them to make an informed decision. Individual shareholders can stop the transaction if their target board does not make this decision.
Legal due diligence work streams include commercial contracts finance agreements, real estate (owned or leased), IP, pension and employment issues, as well as other legal issues. Compliance issues like anti-bribery and corruption as well as money laundering and data protection are also on the agenda.