The Impact of the Wagevoe

The Act on the Amendment of the Dispute Resolution Proceedings for Shareholders  and Inquiry Proceedings (Wet aanpassing geschillenregeling en verduidelijking ontvankelijkheidseisen enquêteprocedure, abbreviated in Dutch as Wagevoe, Stb. 2024, 174) came into effect on 1 January 2025 (Stb. 2024, 175). The Wagevoe modernizes shareholder dispute resolution by streamlining procedures and providing clearer guidelines for capital providers and listed companies seeking rights of inquiry. The primary aim of the Wagevoe is to enhance the efficiency and effectiveness of dispute resolution mechanisms. This article outlines the key changes introduced by the Wagevoe.

The Inquiry Procedure and the Shareholder Dispute Resolution Procedure
The inquiry and dispute resolution procedures provide shareholders of Dutch companies with legal mechanisms to address corporate conflicts. Since the introduction of the dispute resolution proceedings in 1989, courts have been empowered to settle shareholder disputes by ordering the transfer of shares.

Shareholders have several mechanisms to resolve disputes among themselves. The Wagevoe introduces several modifications to these mechanisms, which are discussed below. First, the various procedural options available to shareholders are outlined:

1. Expulsion Procedure (in Dutch: de “uitstotingsprocedure”): A shareholder may be required to transfer their shares to co-shareholders (Article 2:336 of the Dutch Civil Code (DCC)).
2. Exit Procedure (in Dutch: de “uittredingsprocedure”): Co-shareholders may be required to purchase the shares of a specific shareholder (Article 2:343 DCC).
3. Voting Rights Transfer: The voting rights of a usufructuary or pledgee of shares may be transferred (Article 2:342 DCC).
4. Voluntary Exit (in Dutch: de “vriendelijke uittreding”): If shareholders agree on an exit but not on the price of the shares, the court may determine the share value (Article 2:343c DCC).
5. Inquiry Procedure: If there are legitimate concerns about the governance or management of a company, shareholders may initiate an inquiry into corporate affairs. If mismanagement is established, the Enterprise Chamber of the Court of Appeal may impose immediate measures such as suspending or dismissing directors, appointing interim directors or supervisory board members, temporarily transferring shares, or dissolving the company (Book 2, Title 8 DCC).

As part of the flexibilization of private limited company (BV) law in 2012, procedural improvements were introduced to shorten proceedings, including the ability to declare judgments provisionally enforceable and impose interim measures. However, ongoing criticism led to further modernization through the Wagevoe.

Key Changes Introduced by the Wagevoe (Dispute Resolution procedure)
The key changes introduced by the Wagevoe with regard to the dispute resolution procedure are summarized below.

1) Scope of Application
Unlike the previous dispute resolution rules, the Wagevoe does not apply to all BVs. Instead, its scope is now limited to non-listed NVs and BVs. The rationale behind this change is that the dispute resolution procedure is primarily designed for smaller companies where share sales are not always feasible.

2) Procedural Changes

• A significant procedural change introduced by the Wagevoe is the transition from a writ of summons procedure to a petition procedure for dispute resolution cases, specifically expulsion and exit procedures. Previously, the procedures under points (1) to (3) above followed a writ of summons procedure, while (4) and (5) were handled through a petition procedure. The Wagevoe standardizes these procedures to enhance accessibility and efficiency. This also allows for related claims, such as compensation claims, to be filed within the same proceedings, enabling a comprehensive resolution of shareholder disputes.
• The procedure is now streamlined to a single instance before the Enterprise Chamber of the Amsterdam Court of Appeal, with the possibility of appeal to the Supreme Court. This change reduces procedural delays compared to the previous framework, where cases were first heard by a district court and only later reviewed by the Enterprise Chamber of the Amsterdam Court of Appeal. Additionally, this reform facilitates the consolidation of dispute resolution cases with inquiry proceedings before the Enterprise Chamber.

3) Expanded Grounds for Expulsion
The grounds for shareholder expulsion have been broadened. Previously, only conducts within the capacity of a shareholder amounted or justified expulsion. However, under the Wagevoe, actions taken in other capacities, such as those of a director or even a private individual, can also lead to expulsion. The new legal standard requires that a shareholder’s behavior must harm the company to such an extent that their continued involvement is no longer reasonable (Article 2:336a(1) DCC).

4) Equal Treatment of Certificate Holders
The Wagevoe explicitly recognizes the position of certificate holders. The dispute resolution procedure is now available to certificate holders of NVs if the certificates were issued with the company's cooperation. It also applies to certificate holders of BVs who have been granted statutory meeting rights (Article 2:343(6) DCC).

Key Changes Introduced by the Wagevoe (Inquiry Procedure)
The Wagevoe also clarifies the admissibility for initiating an inquiry procedure. Under the previous framework, listed companies were subject to different requirements based on whether their issued capital was above or below €22.5 million, leading to legal uncertainty. From 1 January 2025, a single eligibility threshold applies: capital providers of listed companies may initiate an inquiry if they hold at least 1% of the issued capital or have a minimum interest of €20 million. Any shareholder meeting this requirement may file an inquiry request with the Enterprise Chamber of the Amsterdam Court of Appeal.

How Can We Assist You?
The Wagevoe introduces significant changes for shareholders of Dutch companies, effective from 1 January 2025. If you have any questions regarding these changes or how they may impact your situation, please do not hesitate to contact us. Our team is ready to assist you with expert advice.