On 10 November 2020, the upper house of the Dutch parliament adopted a bill regarding the Act on management and supervision of legal entities (the “Act”). The Act will make it possible for all Dutch legal entities (including NVs / BVs, cooperatives and foundations) to:- Set up a supervisory board (in addition to the management board); and
- Opt for a one-tier board system (within a one-tier board tasks are divided between executive and non-executive directors).
In addition, the Act introduces a uniform arrangement for:
- The liability of directors and supervisory directors in the event of bankruptcy;
- The principles directors and supervisory directors must observe in the performance of their duties;
- A situation of a conflict of interest whereby directors and/or supervisory directors must refrain from the decision-making process; and
- Absence or inability of directors and supervisory directors to be included in the articles of association.
The Act also provides for a wider discretion given to the court to dismiss a director or supervisory director of a foundation.
The Act will enter into force per 1 July 2021.
Important to note
The provisions of the Act are applicable immediately after the entry into force of the Act.
Regarding foundations and cooperatives (and associations and mutual benefit organizations) transitional law applies for new provisions regarding:
- Conflict of interest;
- Absence or inability; and
- Multiple voting rights.
In case you have any questions regarding the Act or your corporate governance? Please contact us: Nikki.borgman@computershare.nl.