Newsitems Archive

On a regular basis we send a new letter with items about important developments in the relationship between government organizations and the financial sector. Below you will find previous newsitems

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Self regulation for the insurance sector

Insurers have to deal with legislation and regulations, but they are not sitting still either. In addition to the internal and regulatory supervision that the industry faces, it has laid down a large number of principles in self-regulation Het Verbond van Verzekeraars – – is a strong advocate of this phenomenon: self-regulation stimulates the sector’s self-cleansing culture.

The Insurers’ Code of Conduct is the starting point for the Alliance’s self-regulation package. This code incorporates the core values of the sector: dealing with risks, enabling and being socially involved.

These core values are further elaborated in more than sixty regulations, including covenants, agreements and company regulations. The purpose of each covenant, agreement or company scheme is explained and it is indicated whether the document applies to all insurers or only to certain product segments.

De code can be downloaded here.


No agreement on pension system renewal yet

Although the Netherlands has one of the best pension systems in the world, the need for reform is evident to all parties. This discussion is being conducted by the employees’ organizations, the employers’ organizations and the government. After more than a year of consultation, the discussions have not come to a successful conclusion. The main breaking point was to reduce the retirement age of state pension provision (AOW) back to 65 for heavy professions.

Over the past few months, intensive discussions have taken place within the SER and between the government and the social partners on the renewal of the pension system. The supplementary pension system is in urgent need of renewal. The need for this has been widely shared by various parties for years. The pension system no longer fits in well with the labor market, there are emerging tensions between generations where togetherness is desirable, trust is damaged because indexation of pensions does not take place.

Last year, in its coalition agreement, the government outlined a direction for the renewal of the pension system, which is in line with previous opinions of the SER (The consultative body between the trade unions, employers and the government). The Cabinet has given the social partners the opportunity to design and implement a new pension contract.

The government is now considering the follow-up process, because the urgency of renewing the pension system remains undiminished.


The Dutch Minister of Finance sets up the Committee on the Future of the Accountancy Sector

The Minister of Finance will appoint the Committee on the Future of the Accountancy Sector, which will independently investigate how the quality of statutory audits by auditors can be improved. The Committee will also examine possible interventions in the structure and earnings models of the audit firms.

The Committee’s appointment was prompted by various studies that show that the sector itself is making insufficient progress on the necessary improvements to the audits of companies’ annual accounts.

The Commission is also looking at the audit only model (which separates the audit and advisory work of audit firms), as well as other fundamental changes in the structure of audit firms.

Stricter requirements for tax rulings

There will come stricter requirements for the issuing of international rulings. The Dutch National Revenue Service will also publish an anonymous summary for each ruling.

The aim is to have the measures take effect on 1 July 2019. The measures imply that letterbox companies that only establish themselves in the Netherlands for tax reasons and have no other added value to the Dutch economy will no longer receive a ruling from the Netherlands Revenue Service. This also applies to rulings on transactions with companies established in low-tax countries or on the European Union’s blacklist. Low-taxing countries are countries that have a tax rate of less than 9%.

When applying for a ruling, stricter requirements are also imposed on the physical presence of a company in the Netherlands.

The ruling practice will also become more transparent. The Neterlands Revenue Service will publish an anonymised summary of every international ruling that is issued immediately after the ruling is issued and will also publish an annual report every year. And independent experts continue to investigate annually whether the rulings have been issued within the law and in accordance with the rules.

All rulings with an international character that are applied for will now go to one central team before they are issued. In future, all international rulings will also have a maximum term of five years; this can only be extended to ten years in exceptional cases.

When applying for a ruling, stricter requirements are also imposed on the physical presence of a company in the Netherlands. For example, whether there are sufficient people working in relation to the total size of a company, or the activities that the company carries out in the Netherlands.


Dutch Central Bank President Klaas Knot gets top position at the Financial Stability Board

Klaas Knot, President at De Nederlandsche Bank, was appointed Vice-Chairman of the Financial Stability Board (FSB). Randal Quarles, director and vice-chairman for the supervision of the American Federal Reserve, becomes chairman. The appointment will take effect on 2 December 2018. It has also been agreed that Knot will take over the chairmanship of Quarles in three years’ time, also for a period of three years. The current chairman Mark Carney will step down on 1 December.

Knot was already chairman of the Standing Committee on Assessment of Vulnerabilities (SCAV) and will combine this with the vice-chairmanship. Knot will perform this function in addition to his role as President at DNB.

The FSB was established at a G20 summit in London in 2009. The G20 mandated the body to promote the stability of the financial market in general and the banking sector in particular. The FSB is the successor to the Financial Stability Forum established by the G7 in 1999. Mario Draghi was the first president of the FSB. Mark Carney succeeded him in 2011.

Letterbox firms do not contribute to the Dutch economy.

The income that the Netherlands derives from letterbox companies has risen sharply in recent years. Yet the real contribution to the economy is only small, according to a calculation by the CBS and De Nederlandsche Bank The employment contribution is limited. At the one hand hand GNP is rising, because large amounts of money are flowing through the Netherlands. At the other hand the GDP-rise leads to a higher contribution to the European Union. According to the latest calculations of the CBS and DNB – part of the recently completed revision of macroeconomic statistics – have these listed NV’ s without a physical footprint since 2010 increasing upward impact on GNI each year, by 8.6 billion euro at its peak in 2017.

Formally established in the Netherlands? Dutch judges consider themselves to have jurisdiction in mass claims.

Dutch courts consider themselves to have jurisdiction to rule on the mass claims for compensation filed by investors against Petrobras and Steinhoff, according to two judgments given in September. On 19 September last, the District Court of Rotterdam considered itself authorized to rule on claims filed by Dutch and non-Dutch investors via the Stichting Petrobras Compensation Foundation against the Brazilian energy company Petrobras. The court will decide whether Petrobras unlawfully concealed the fraud committed by Petrobras between 2004 and 2014, whether Petrobras published incorrect, incomplete and/or misleading financial information and issued bonds on the basis thereof and whether Petrobras consciously and unjustifiably created investor confidence during the fraud period. The fact that the court considers itself competent in this case is mainly due to the fact that Petrobras Global Finance (PGF) is based in the Netherlands and that Petrobras, through this subsidiary, raised outside capital through the issue of bonds during the fraud period. In connection with this, prospectuses have been issued.

On 26 September last, the District Court of Amsterdam considered itself to have jurisdiction to handle the mass claim that the investors’ association VEB has filed against Steinhoff International Holdings. VEB claims that Steinhoff investors have suffered damage as a result of the publication of incorrect, incomplete and misleading financial information in the annual accounts for the financial years 2015 and 2016, prospectuses and/or press releases. The Court found itself to have jurisdiction in this case because Steinhoff is formally established in the Netherlands. The defence of the furniture multinational that in Germany, where it has a stock exchange listing, a similar type of lawsuit has already been brought by an investor, cannot change the court’s mind. It is not certain whether the German court has jurisdiction, and it is also unclear whether the German court will give its verdict within a reasonable period of time. It is expected that the Dutch courts will rule in both the Petrobras and Steinhoff cases in 2019.

Substantial fine for ING for failing compliance and governance policies

Between 2010 and 2016, ING Bank Nederland structurally violated the Money Laundering and Terrorist Financing (Prevention) Act (Wwft) and thus committed criminal offences. The Public Prosecution Office (OM) has also found that ING has enabled criminals to use ING’s accounts for purposes including money laundering. On 4 September last, the Public Prosecution Office fined ING € 675 million for these offences. Furthermore, ING must pay the State € 100 million in illegally obtained benefits. This is the amount that the Public Prosecution Office believes ING has wrongly saved by saving for years on staff who should have ensured compliance with the compliance policy.

The Public Prosecution Department and ING agree that one of the reasons for the structural shortcomings in the fulfilment/execution of the Wwft obligations was the lack of attention and priority within ING for this subject. The ‘tone at the top’ did not sufficiently underline the importance of compliance with the Wwft. ING’s focus was also mainly on the profitability of the organisation and the achievement of the commercial objectives; compliance with the Wwft was often considered less important than the business, according to the OM’s fact sheet. Furthermore, there was insufficient will and strength within ING to solve the problems in a sustainable way and internal controls in the area of compliance risk management were not functioning properly. According to the Public Prosecution Service, the offences cannot be attributed individually to individuals, not even to the ING management. The Public Prosecution therefore attributes the offences to ING as an organisation. Nevertheless, CFO Koos Timmermans decided to resign on 11 September last. ING has already launched several initiatives to strengthen compliance risk management. The implementation of these initiatives is intensively monitored by DNB. In a motion adopted unanimously on 21 September last, the Lower House of Parliament asked the government to examine whether “steps for improvement” could still be taken to make it easier to punish the criminal acts of individuals in future. The government must inform the House of Representatives of this within a year.

Start consultation of the list of low-tax countries and treaty policy

The Dutch government is taking various measures to combat tax avoidance and evasion, while keeping the Netherlands attractive to real business. This is consistent with the fact that the Netherlands is renewing its treaty policy and drawing up a list of low-tax countries. The Ministry of Finance is now starting an internet consultation on this subject from 25 September to 22 October.

The aim of the measures is to prevent the Netherlands from being used for transfer activities to tax havens. The Netherlands plans to include the following states on the list of low-tax countries in 2019: Anguilla, Bahamas, Bahrain, Bermuda, British Virgin Islands, Guernsey, Isle of Man, Jersey, Cayman Islands, Kuwait, Palau, Qatar, Saudi Arabia, Turks and Caicos Islands, Vanuatu and the United Arab Emirates. These are states without profit tax or with a rate of less than 7%. The consultation gives those concerned the opportunity to share their knowledge about the tax systems of other countries before the list is finalised. This will prevent countries from being wrongly included or not being included in the list. After 2019, the list will be updated annually and redefined.

The list will be used for two measures to combat tax avoidance and evasion. This also applies to states included in the EU list of tax havens (list of non-cooperative jurisdictions). The first is the CFC measure proposed on Budget Day, which will take effect on 1 January 2019. With this measure, the government wants to prevent companies from avoiding tax by shifting mobile assets to a company in a low-tax country. The list is also used for the introduction of a conditional withholding tax on dividends (as of 1 January 2020) and interest and royalties (as of 1 January 2021). This means that the countries on the Dutch list will pay a tax of 22.25% on these dividends, interest and royalties in 2021. This will prevent the Netherlands from being used for transfer activities to tax havens.


Legal Headwinds: up-to-date overview of legislation and regulations in the Netherlands and Europe in the assetmanagement domain.

Legal Headwinds offers an up-to-date overview of the most important developments, now and in the future, in the field of legislation and regulations in the Netherlands and the EU that are relevant for asset managers. The overview is not exhaustive. The overview is updated every quarter. Thanks to Simmons & Simmons.

External experts in board position reviews

This summer, supervisors have started a pilot project with the Netherlands Authority for the Financial Markets (AFM) and the Dutch Central Bank (DNB), in which external experts are involved in management board reviews. The pilot runs for one year and will then be evaluated.

The external experts have been appointed to improve the independence, professionalism and support for the assessment process of directors. The choice was therefore made for candidates who have boardroom experience or who can bring the boardroom’s perspective into the assessment process. The AFM and DNB have also appointed a joint external confidential adviser and DNB has appointed an external chairman for the hearing committee in the objection phase against decisions on boardroom reviews. The AFM has had an external chairman of the Hearing Committee in the objection phase for some time.

At the AFM, Janka Stoker, Hans van der Noordaa and Ewoud Goudswaard will be involved as external experts in the assessment process. Janka Stoker is Professor of Leadership and Organisational Change at the University of Groningen. She was also a member of the Ottow. Former CEO Delta Lloyd Hans van der Noordaa is a member of the Supervisory Board of Stadsherstel Amsterdam and the Health(e)Foundation. Ewoud Goudswaard was CEO of ASN Bank and will be interim CCO of de Volksbank until 1 September 2018. He is also a supervisory director of Triple Jump, investment manager.

At DNB, Pauline van der Meer Mohr, Ludo Wijngaarden and Johan van Hall will be involved as external parties in the assessment process. Pauline van der Meer Mohr is a supervisory director of DSM, HSBC Holdings plc and EY, among others. Ludo Wijngaarden was a member of the supervisory board of the Volksbank and is a member of the Advisory Board of the Dutch Data Protection Authority. Johan van Hall was vice-chairman of the Executive Board of ABN AMRO Bank until 1 March last.

Both supervisors will involve the external parties in the performance of personal assessments, including the conduct of assessment interviews. This means that they will be given access to the assessment file, and will actively participate in the assessment interview and the subsequent forming of an opinion. They will also assess a number of initial assessments on paper. External experts are also free to give advice on the assessment process, both solicited and unsolicited.

Joost Italianer has been asked by both regulators to act as an external confidential advisor. He is a lawyer and expert in the field of compliance and market abuse and is a member of the Court of Discipline, the appeal body in lawsuits of the Dutch Bar Association. The confidential adviser can be called in if there is a procedural conflict or a complaint about the treatment of the case.

In addition to the above external experts and the confidential contact person, DNB has also found Eric Daalder (member of the Council of State) willing to act as external chairman of the hearing committee in objection to decisions on DNB’s directors’ reviews. The external chairman is responsible for the course of events during the hearing, monitors the process and ensures that all relevant facts are carefully collected in order to arrive at the essence of the objection. The AFM has had such an independent chairman of the Hearing Committee in the objection phase for some time. The hearing committee currently has two external chairpersons: Mr C.O.W. Dubbelman and Mrs C.M. Grundmann – Van de Krol.