Bankruptcy Act

TITLE 1 BANKRUPTCY

Chapter 1 Declaration of Bankruptcy

Article 1 Request for a bankruptcy order
- 1. A debtor who is in a situation where he has stopped to pay his due and demandable debts shall be declared bankrupt by court order, rendered either upon his own request or upon the request of one or more of his creditors*).
- 2. The bankruptcy order may also be rendered for reasons of public interest or upon the request of the Public Prosecution Service.

*) A debtor who applies for his own bankruptcy has to make plausible to the court that he is no longer able to pay off his debts. When a creditor applies for the bankruptcy of the debtor he must, briefly, prove the same. In practice this means, although not formally required, that such creditor must not only submit his own claim(s), but he has to make plausible as well that the debtor is in default of performing at least one other claim of another creditor ('supporting claim'). Only then the court is able to asses that the debtor has stopped to pay his due and demandable debts. So it's not possible for a creditor to lodge a petition for bankruptcy when the debtor only fails to comply with this creditor's claim(s). In such event the creditor can only try to acquire an enforceable judgment against the debtor (to be obtained after normal proceedings) which makes him entitled to foreclose the debtor's property, from which he, subsequently, may recover his claim(s).

Article 2 Court where a request for a bankruptcy order must be lodged
- 1. The bankruptcy order is rendered by the District Court within whose district the domicile of the debtor is located.
- 2. If the debtor has left the Netherlands, the District Court within whose district his last domicile was located, has jurisdiction.
- 3. With respect to partners of a general partnership (‘vennooptschap onder firma’)*), the District Court within whose district the (registered) office of that general partnership is located, shall have jurisdiction as well.
- 4. If the debtor has no domicile within the Netherlands, yet he conducts a professional practice or business there, the District Court within whose district his (registered) office is located, shall have jurisdiction.
- 5. If, in the events referred to in paragraph 3 and 4, bankruptcy orders are rendered by more than one District Court having jurisdiction on different dates, only the first bankruptcy order will have legal effect. If bankruptcy orders of different District Courts are rendered on the same date, only the bankruptcy order of the District Court listed first in the Official Bulletin of Acts and Orders ('Staatsblad') shall have legal effect.

*) The same applies to a limited partnership ('commanditaire vennootschap') in respect of the fully liable partners.

Article 3 Immediate additional request for the application of the Debt Repayment Scheme
- 1. If a request for a bankruptcy order concerns a debtor who is a natural person and who has not requested for the application of the Debt Repayment Scheme referred to in Title III, then the clerk of the court shall immediately notify him by letter that he may lodge a request as meant in Article 284 within fourteen days of the date on which such letter was sent.
- 2. A hearing on the request for a bankruptcy order shall be stayed until the period referred to in paragraph 1 has expired.

Article 3a Request for a bankruptcy order and for a Debt Repayment Scheme order
- 1. If a request for a bankruptcy order and a request for the application of the Debt Repayment Scheme referred to in Title III are pending at the same time, the latter shall be heard first.
- 2. The hearing of the request for a bankruptcy order shall be stayed until the court has given a final and binding decision on the request for the application of the Debt Repayment Scheme.
- 3. The request for a bankruptcy order shall lapse by operation of law upon a judgment ordering the definitive application of the Debt Repayment Scheme.

Article 3b Request for bankruptcy when the debtor already falls under the scope of a Debt Repayment Scheme
Articles 3 and 3a shall not be applied if a request for a bankruptcy order concerns a debtor to whom the Debt Repayment Scheme already applies.

Article 4 Formal requirements for a request for a bankruptcy order
- 1. The request for a bankruptcy order is made and the petition therefore is lodged with the clerk of the District Court and shall be heard in chambers as soon as possible. The Public Prosecution Service shall be heard upon such a request. If the request for a bankruptcy order is made by the debtor himself and he is a natural person, then the clerk of the District Court shall immediately notify him that he may lodge, without prejudice to Article 15b, paragraph 1, a request for the application of the Debt Repayment Scheme as referred to in Article 284.
- 2. A debtor who is married or has entered into a registered partnership may only file a request for a bankruptcy order in respect of himself with the cooperation of his spouse or, respectively, his registered partner, unless any community of property has been excluded between the spouses or, respectively, the registered partners.
- 3. In the event of a general partnership (‘vennootschap onder firma’)*), the application for a bankruptcy order must list the names and addresses of each of the partners who are jointly and severally liable for the debts of the general partnership.
- 4. The request for a bankruptcy order must contain such information that the court is able to determine whether it has jurisdiction on the basis of the European Regulation mentioned in Article 5, paragraph 3.
- 5. The bankruptcy order shall be pronounced in open court and is enforceable immediately, notwithstanding any appeal or contrary legal action.

*) The same applies to a limited partnership ('commanditaire vennootschap') in respect of the fully liable partners.

Article 5 Requests must be lodged by an advocate
- 1. The requests (petitions) referred to in the preceding Article and in Articles 8, 9, 10, 11, 15c, paragraph 2, 67, 155, 166, 198 and 206 must be lodged by an advocate (solicitor admitted to the Bar).
- 2. Paragraph 1 does not apply to an appeal instituted against an order of the magistrate ('rechter-commissaris') through which the liquidator ('curator') becomes authorised to terminate an employment contract.
- 3. Requests (petitions) made pursuant to Article 33 of European Regulation EC/No 1346/2000 of 29 May 2000 on insolvency proceedings must be lodged by an advocate (solicitor admitted to the Bar).

Article 6 Rendering of the bankruptcy order
- 1. The District Court may order that the debtor is to be summoned to be heard in court, either in person or through a representative authorized as such by written procuration (power of attorney). In such event, the clerk of the court shall ensure that the debtor is summoned in the way as provided by Order in Council for this purpose. Where main insolvency proceedings have been opened outside the Netherlands pursuant to Article 3, paragraph 1, of the European Regulation mentioned in Article 5, paragraph 3, the clerk of the court shall, without delay, notify the liquidator in these main insolvency proceedings in writing of the request for a bankruptcy order filed at a Dutch Court, indicating as well that he may express his views about this request within a period to be set by the Dutch court.
- 2. If the debtor, who is summoned to be heard in court, is married or has entered into a registered partnership, his spouse or, respectively, his registered partner may also appear in court, either in person or through a representative authorized as such by written procuration (power of attorney).
- 3. The bankruptcy order shall be rendered if, after a brief investigation, there appear to be facts and circumstances from which follows that the debtor is in a situation where he has stopped to pay his due and demandable debts and, where the request for the bankruptcy order is made by a creditor, that this creditor has a claim against the debtor*).
- 4. Where the jurisdiction of the Dutch court is based on the European Regulation mentioned in Article 5, paragraph 3, then the bankruptcy order will specify whether the ordered bankruptcy in the Netherlands concerns main insolvency proceedings or territorial insolvency proceedings within the meaning of that European Regulation.

*) A debtor who applies for his own bankruptcy has to make plausible to the court that he is no longer able to pay off his debts. When a creditor applies for the bankruptcy of the debtor he must, briefly, prove the same. In practice this means, although not formally required, that such creditor must not only submit his own claim(s), but he has to make plausible as well that the debtor is in default of performing at least one other claim of another creditor ('supporting claim'). Only then the court is able to asses that the debtor has stopped to pay his due and demandable debts. So it's not possible for a creditor to lodge a petition for bankruptcy when the debtor only fails to comply with this creditor's claim(s). In such event the creditor can only try to acquire an enforceable judgment against the debtor (to be obtained after normal proceedings) which makes him entitled to foreclose the debtor's property, from which he, subsequently, may recover his claim(s).

Article 7 Right to seal off the property of the debtor pending the investigations
- 1. Pending the investigations, the District Court may, if so requested, grant the petitioner the right to seal off the property (estate) of the debtor. It may do so subject to security given for such amount as it may determine.
- 2. The seals shall be affixed by a notary assigned when the right to seal off the debtor’s property (estate) was granted by the court. The assets referred to in Article 21 shall not be sealed; a brief description thereof shall be included in the official report.

Article 8 Appeal or objection by the debtor against the bankruptcy order
- 1. The debtor who has been declared bankrupt after he had been heard on a request for his bankruptcy has a right to appeal against the bankruptcy order during a period of eight days after the date of that order.
- 2. If he has not been heard, he has the right to lodge an objection against the bankruptcy order within fourteen days after the date of that order. If he finds himself outside the Netherlands at the time that the bankruptcy order was rendered, then this period is extended to one month.
- 3. The debtor may appeal against the judgment, given upon his objection, within eight days from the date of that judgment.
- 4. The appeal and the objection must be made by means of a written request (petition) lodged with the clerk of the court that must be seised. The President of that court shall immediately set the date and time for the matter to be heard. No later than on the fourth day following the day on which the debtor lodged his request (petition), the debtor must have notified the advocate (solicitor admitted to the Bar) who lodged the request for the bankruptcy order, of the objection or appeal made, and of the time set for the hearing, which notification must be made by means of a bailiff’s writ officially served on that advocate (solicitor admitted to the Bar),
- 5. Towards the creditor who has sought the debtor’s bankruptcy this notification shall serve as a summons to appear in court.
- 6. The matter will be heard as provided for in Article 4.

Article 9 Possibility of appeal for the petitioner
- 1. If a request for a bankruptcy order is rejected, an appeal against that decision may be filed within eight days following the date of rejection.
- 2. The same applies if a bankruptcy order is nullified as a result of an objection made against it as referred to in Article 8, in which case the clerk of the Court of Appeal before which the appeal proceedings were instituted shall, without delay, notify the clerk of the court which ordered the nullification of the bankruptcy order.
- 3. The appeal proceedings shall be instituted and heard as provided under Articles 4 and 6.

Article 10 Others who may make an objection against the bankruptcy order
- 1. Each creditor, with the exception of the creditor who requested for the bankruptcy order, and each interested party has the right to lodge an objection against the bankruptcy order within eight days from the date of that order.
- 2. The objection is made by written request (petition), lodged with the clerk of the court which rendered the bankruptcy order.
- 3. The presiding judge of that court shall immediately set the date and time for the hearing. No later than on the fourth day following the day on which the petitioner lodged his request (petition), the petitioner must have notified the debtor and, where the bankruptcy order has been requested for by a creditor, the advocate (solicitor admitted to the Bar) who lodged the request for the bankruptcy order on behalf of this creditor, of the objection against the bankruptcy order and of the time set for the hearing, which notification must be made by means of a bailiff’s writ which has been officially served on that debtor and, respectively, that advocate (solicitor admitted to the Bar).
- 4. Towards the debtor and that creditor this notification shall serve as a summons to appear in court.
- 5. The matter will be heard as provided for in Article 4.

Article 11 Possibility of appeal for others than the petitioner
- 1. A creditor or interested party whose objection against the bankruptcy order as referred to in the preceding Article has been rejected by the District Court, has the right to appeal against this decision within eight days from the date of rejection.
- 2. The same right of appeal belongs to the debtor, the creditor who requested for the bankruptcy order and the Public Prosecution Service if the bankruptcy order is nullified as a result of an objection made against it as referred to in Article 10, in which case Article 9, paragraph 2 shall apply.
- 3. The appeal proceedings shall be instituted and heard as provided for in Articles 4 and 6.
- 4. If the objection has been lodged with the Court of Appeal, any further appeal shall be excluded.

Article 12 Appeal in cassation
- 1. The debtor, the creditor who requested for the bankruptcy order, the creditor or interested party as referred to in Article 10, and the Public Prosecution Service have the right to lodge an appeal in cassation (appeal to the Supreme Court) against the judgment rendered by the Court of Appeal within eight days after the date of that judgment.
- 2. The appeal in cassation shall be lodged and heard as provided for in Articles 4, 6 and 8.
- 3. If the appeal in cassation is made against a judgment of a Court of Appeal in which a bankruptcy order has been nullified, the clerk of the Supreme Court shall, without delay, notify the clerk of that Court of Appeal.

Article 13 Acts already performed by the liquidator remain valid and binding for the debtor
- 1. If a bankruptcy order has been nullified as a result of an objection, an appeal or an appeal in cassation made against it, all acts performed by the liquidator ('curator') prior to or on the day on which a publication in accordance with Article 15 was made, shall nevertheless remain valid and binding for the debtor.
- 2. Pending an objection, an appeal or an appeal in cassation, no consultations for a final arrangement (composition) with the creditors can take place, nor is it possible to proceed to a winding-up (liquidation) without the consent of the debtor.

Article 13a Termination of an employment agreement when the bankruptcy order has been nullified
If the bankruptcy order has been nullified, then the termination of an employment agreement by the liquidator ('curator') shall be governed, in derogation from Article 13, paragraph 1, by the statutory or agreed rules applicable outside bankruptcy, on the understanding that the periods referred to in Article 683, paragraph 1 and 2, of Book 7 of the Civil Code, and in Article 9, paragraph 3, of the Extraordinary Labour Relations Decree ('Buitengewoon Besluit Arbeidsverhoudingen'), shall start to run as of the moment on which the bankruptcy order was nullified.

Article 14 Appointment of magistrate and liquidator in bankruptcy; publication of information
- 1. The bankruptcy order shall provide for the appointment of one of the members of the District Court as magistrate in bankruptcy ('rechter-commissaris'), and the appointment of one or more liquidators ('curators'). The court which renders the bankruptcy order shall in that order also charge the liquidator ('curator') with the opening of letters and telegrams addressed to the bankrupt debtor. The District Court shall mention in its judgment the precise time, as to the exact minute, on which the debtor has been declared bankrupt.
- 2. The mail transport company or mail transport companies that have been designated as provider of general mail services, and other certified mail transport companies as meant in the Mail Act 2009 ('Postwet 2009'), shall, without delay, be informed by the clerk of the court of the charge as referred to in the previous paragraph.
- 3. An extract of the bankruptcy order, listing the name, address or office and profession of the bankrupt debtor, as well as the name of the magistrate ('rechter-commissaris'), the name and address or office of the liquidator ('curator'), the date of the bankruptcy order and, if a provisional creditors committee has been appointed, the names, professions and addresses or offices of all members of that committee, shall immediately be published by the liquidator ('curator') in the Government Gazette ('Staatscourant').
- 4. Upon the request of a liquidator in insolvency proceedings opened pursuant to Article 3, paragraph 1 or 2, of the European Regulation mentioned in Article 5, paragraph 3, the clerk of the District Court at the Hague shall immediately publish in the Government Gazette ('Staatscourant') the data referred to in Article 21 of that European Regulation. Such a publication is made in any event if the debtor has an establishment in the Netherlands in the meaning of Article 1, under point (h), of the before mentioned European Regulation. The data meant in the first sentence of the present paragraph, shall be provided by the clerk of the court in the Dutch, English, German or French language.

Article 15 Consequences of the nullification of a bankruptcy order
- 1. As soon as a bankruptcy order has been nullified as a result of an objection, an appeal or an appeal in cassation, and, in the first two cases, the time limit for appeal or appeal in cassation has expired without any appeal, the liquidator ('curator') and the mail transport company or mail transport companies that have been designated as provider of general mail services and other certified mail transport companies as meant in the Mail Act 2009 ('Postwet 2009'), shall be notified by the clerk of the court which ordered the nullification of that court order.
- 2. Where a bankruptcy order has been nullified on an appeal or an appeal in cassation, a similar notification shall be given to the clerk of the court which rendered the bankruptcy order.
- 3. The court which ordered the nullification of a bankruptcy order shall also determine the amount of the costs of bankruptcy and the remuneration of the liquidator ('curator'). It shall charge this amount to the party who requested for the bankruptcy order or to the debtor, or to both, in a proportion to be determined by the court. No appeal or other remedy (action) is available against this decision. An enforcement order shall be issued in this respect for the benefit of the liquidator ('curator').

Article 15a Bankruptcy order rendered on appeal or appeal in cassation
If the bankruptcy order is rendered on an appeal or an appeal in cassation, as a result of which the judgment in which the request for a bankruptcy order was rejected has been nullified, the clerk of the court which rendered the bankruptcy order shall notify the clerk of the court where the request was lodged.

Article 15b Conversion of bankruptcy into the Debt Repayment Scheme
- 1. If the bankrupt debtor reasonably is not to blame for not lodging a request for the application of the Dept Repayment Scheme within the period meant in Article 3, paragraph 1, or if he has been declared bankrupt upon his own request, then the District Court may, until the verification meeting has been held or, where no verification meeting will be held, until the magistrate ('rechter-commissaris') has given the orders referred to in Article 137a, paragraph 1, remove the bankruptcy order upon the request of the bankrupt debtor, and simultaneously render a court order for the application of the Debt Repayment Scheme as referred to in Title III.
- 2. For such purpose the bankrupt debtor shall file a request (petition) as meant in Article 284 at the District Court where the request for the bankruptcy order was lodged. Article 284, paragraph 3, shall not apply in that event.
- 3. Paragraph 1 shall not apply:
a. if the debtor has been declared bankrupt while the Debt Repayment Scheme was already in effect with regard to him;
b. if the debtor has become bankrupt as a result of the termination of an applicable Debt Repayment Scheme;
c. if the bankruptcy order was rendered pursuant to Article 340, paragraph 4.
- 4. Before making a decision, the District Court may call the bankrupt debtor, the magistrate ('rechter-commissaris') and the liquidator ('curator') to court in order to be heard. Article 6, paragraph 2, shall apply in that event.
- 5. When the request (petition) is awarded, the District Court shall order the definitive application of the Debt Repayment Scheme.
- 6. In the notice (publication) required by Article 293, the clerk of the court shall give notice that the bankruptcy order has been removed. If the time for the verification meeting in the bankruptcy was already set in accordance with Article 108, such notice shall also mention that this verification meeting shall not be held anymore.

Article 15c Legal actions regarding the conversion of bankruptcy into the Debt Repayment Scheme
- 1. No appeal or other remedies (actions) are available for the creditors and other interested parties against a judgment in which the bankruptcy order has been removed so as to make the application of the Dept Repayment Scheme possible.
- 2. If the request for the application of the Dept Repayment Scheme has been rejected by the court, then the bankrupt debtor has a right to lodge an appeal against this decision within eight days after the date of that decision. An appeal is made by means of a request (petition) lodged with the clerk of the Court of Appeal that must be seized to hear the matter. The clerk of the Court of Appeal shall notify the clerk of the District Court without delay that such a request (petition) has been lodged.
- 3. The presiding judge of the Court of Appeal shall immediately set the date and hour for the hearing, which is to be held within twenty days from the date on which the request (petition) was lodged. The Court of Appeal shall give its judgment no later than eighth days after the day on which the hearing on the request was held. The clerk of the Court of Appeal shall notify the clerk of the District Court without delay of the judgment of the Court of Appeal.
- 4. If the Court of Appeal upholds (acknowledges) the declaration of bankruptcy, the bankrupt debtor may lodge an appeal in cassation within eight days from the date of the judgment of the Court of Appeal. An appeal in cassation is made by means of a request (petition) lodged with the clerk's office of the Supreme Court. The presiding judge of the Supreme Court shall immediately set the date and hour for the hearing. The clerk of the Supreme Court shall notify the clerk of the District Court without delay of the appeal in cassation and of the decree (decision) of the Supreme Court.
- 5. As long as no decision has been given on a request (petition) as referred to in Article 15b, paragraph 2, and, provided that the application of the Debt Repayment Scheme has not been ordered, no consultation for a final arrangement (composition) in the bankruptcy may take place and no distribution to creditors may be made pending the appeal or appeal in cassation.

Article 15d Acts performed during bankruptcy remain valid after a conversion into the Debt Repayment Scheme
- 1. If the bankruptcy order is removed and simultaneously a court order for the application of the Debt Repayment Scheme has been rendered, the following shall apply:
a. juridical acts performed by the liquidator ('curator') during bankruptcy shall remain valid and binding;
b. estate debts*) which arose during bankruptcy shall be treated as estate debts*) for the application of the Debt Repayment Scheme;
c. claims submitted by creditors during the bankruptcy shall be treated as claims submitted for the application of the Debt Repayment Scheme.
- 2. The commencement of the time periods mentioned in Articles 43 and 45 shall be calculated as of the date of the declaration of bankruptcy.

*) Estate debts are debts which are made by or with the consent of the liquidator for account of the liquidation estate; the involved creditor has a preferential claim (estate claim) that must be satisfied first from the assets of the liquidation estate.

Article 16 Termination of the bankruptcy because of insufficient assets
- 1. Where the available assets are not sufficient to pay the bankruptcy costs and the other estate debts*), the District Court may order, upon a proposal of the magistrate ('rechter-commissaris') and after having heard the creditors committee, if any, that the bankruptcy proceedings shall be free of charges or, after having heard or duly summoned the bankrupt debtor, that the bankruptcy is terminated. In the latter case the court order shall be pronounced in open court.
- 2. A court which orders the termination of the bankruptcy shall also determine the amount of the bankruptcy costs and, if there are grounds for doing so, the remuneration of the liquidator ('curator'). It shall charge these amounts to the debtor. They will have priority over all other debts.
- 3. No right of appeal or other remedies (actions) are available against a court order as meant in the previous paragraph. An enforcement order shall be issued in this respect for the benefit of the liquidator ('curator').
- 4. In derogation from what has been provided in paragraph 2, the costs of publications which have to be made pursuant to the present Title (Title I), shall be borne by the State to the extent that these costs cannot be paid from the liquidation estate. The clerk of the court which ordered the termination of the bankruptcy shall procure the payment of the amount determined by the court to be charged to the State.

*) Estate debts are debts which are made by or with the consent of the liquidator for account of the liquidation estate; the involved creditor has a preferential claim (estate claim) that must be satisfied first from the assets of the liquidation estate.

Article 17 Exemption from court fees
An order that the bankruptcy proceedings are free of charge results in an exemption from court fees.

Article 18 Termination of the bankruptcy; publication
The court order in which the bankruptcy is terminated, shall be published in the same way as the bankruptcy order, and the debtor and creditors may appeal against it in the same way and within the same periods as provided for with regard to a judgment rejecting a bankruptcy order. If, within three years after such termination, a new request (petition) for a bankruptcy order is lodged, then the debtor or petitioner must demonstrate that there are sufficient assets to cover the costs of bankruptcy.

Article 19 Publication in the bankruptcy registers of the District Court
- 1. The clerk of each District Court shall keep a public register in which he registers, for each bankruptcy separately, the following data in the following sequence, with mention of the date of registration:
1° an extract from the court decisions in which a debtor has been declared bankrupt or in which such a bankruptcy has been removed or terminated;
2° the brief content of a final arrangement (composition) with creditors, if any, and the sanctioning (approval) thereof by the court;
3° the rescission of the final arrangement (composition) with creditors;
4° the amount of the distributions made during the winding up (liquidation);
5° the termination of the bankruptcy pursuant to Article 15b or Article 16;
6° the rehabilitation.
- 2. The structure and content of the register shall be regulated by Order in Council.
- 3. The clerk of the court must permit public inspection of the register at no cost and provide an extract from the register against payment.
- 4. On behalf of the central register referred to in Article 19a, the clerk of the court shall sent the data meant in paragraph 1 under point (1°) up to and including point (6°) to the Minister of Justice or to the body designated for this purpose by Order in Council.

Article 19a Central bankruptcy register
- 1. A central register is kept by the Minister of Justice or, where pursuant to Article 19, paragraph 4, another body has been designated for this purpose, by that body, in which the data mentioned in Article 19, paragraph 1, under point (1°) up to and including point (6°), shall be registered.
- 2. Further provisions regarding the structure and content of that register are regulated by Order in Council.
- 3. Everyone may inspect the central register at no charge and may obtain extracts from it against payment

Article 19b Registrations to be made in international insolvency proceedings
In the situation meant in Article 14, paragraph 4, the data with regard to the insolvency proceedings meant in that paragraph shall be registered by the clerk of the District Court at the Hague in the register referred to in Article 19, paragraph 1, as well as in the central register referred to in Article 19a, paragraph 1.