Delaware business solutions in Amsterdam?

A unique aspect of the Dutch legal system as compared to the rest of the EU jurisdiction is the possibility to initiate legal proceedings before the Enterprise Chamber. This specialized division of the Amsterdan Court of Appeals is fully equipped to solely settle intra-corporate disputes within companies. No other jurisdiction in Europe is familiar with such a specialized Business Court. The Enterprise Chamber is often compared to the Delaware Court of Chancery, which has also developed a record of success in resolving corporate governance disputes.

The Enterprise Chamber in Amsterdam, just around the corner of our offices, has exclusive jurisdiction over claims arising out of for example disputes between shareholders and/or management relating to proposed management actions, or relating to financial reporting, and it also dissolves disputes with the work council.

The Enterprise Chamber consists of 5 members: 3 judges and 2 specifically selected laymen with a business background who are experts in the field of company law. These judges can resolve disputes more efficiently and more effectively. Moreover, the judges tend to adopt a more informal approach to procedural matters and seem to mainly focus on solving the issue(s) within the company.

The Enterprise Chamber is historically empowered to conduct an investigation into the management policies and conduct of the business at a company, in case of “justified reasons to question the correctness of the companies management policies”. Examples of such “justified reasons” include allegations of violation of the law, financial reporting or accounting irregularities, insufficient provision of information to shareholders or other stakeholders, and conflicts of interest involving the company, its management and/or its shareholders. The purpose of these inquiry proceedings is primarily to provide a tool for obtaining information about the internal affairs of the company, the restoration of healthy internal relations by carrying out certain reorganisations within a company, and/or, if the Chamber rules that a company was mismanaged, to determine who is responsible for such mismanagement. Note that in Dutch law, the view of corporate governance is stakeholder-centered, whereas for example the American view of corporate governance as applied by the Delaware Court of Chancery is shareholder-centered.

Moreover, since the early 90’s, the Enterprise Chamber obtained the authority to also take provisional measures, which has really boosted its popularity. It is a pre-condition for asking such injunctive relief that a regular inquiry procedure has also been asked, but this can be done simultaneously with the application for the injunction.

Injunctive relief may be obtained as soon as within a week from filing the application. In providing this relief the Enterprise Chamber is not limited to the measures that it could order post-inquiry if it ruled that a company was mismanaged. It may order any measure –within the possibilities of the law– it deems fit for in the circumstances given. These injunctions expire when the regular procedure ends. However, the fact that this sort of relief is temporary does not exclude that the injunction ordered may in fact have irreversible consequences.

Interested in the possibilities for you? We are happy to inform you about the further features and possibilities of the procedure in your situation.

Diana Joosten is niet meer werkzaam bij Wieringa Advocaten. Indien u een vraag heeft naar aanleiding van deze blog dan kunt u zich wenden tot onderstaande contactpersoon van het praktijkgebied conflictoplossing / Procesrecht.

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Delaware business solutions in Amsterdam?

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