The Netherlands Commercial Court

What is the Netherlands Commercial Court?

Amsterdam will soon be joining the likes of London, Dubai and Singapore when the new Netherlands Commercial Court opens its doors. This court shall be specialised in hearing complex (international) commercial cases. The Netherlands Commercial Court will offer parties to business and trade disputes a forum where they can litigate in English before neutral, specialist commercial judges, right in the heart of Europe.

Legal proceedings in English

English is indisputably the language of global business. Commercial contracts are frequently drafted in English, parties from countries with different languages communicate with each other in English. But when it comes to litigation, parties to cross-border disputes can be forced to conduct court proceedings in a language which they do not understand. The Dutch judiciary has decided to embrace English as the leading commercial language, establishing an English speaking court, the Netherlands Commercial Court here in Amsterdam.

The court will provide an alternative to parties who want to litigate in English, but wish to avoid expensive forums such as London or the United States.

The Netherlands Commercial Court is also an alternative for those parties who do not want to submit to arbitration, where proceedings are costly and outcomes may not be as predictable as before national courts.

Procedural law in The Netherlands

Dutch procedural law is recognised for being efficient, pragmatic and cost-effective. An example of the advantages of litigating in The Netherlands is the conservatory arrest (Dutch freezing/Mareva injunctions). These orders can be attained with relative ease to prevent assets located in the Netherlands from being removed from the jurisdiction or otherwise disposed of pending the completion of proceedings.
While such injunctions can be quite difficult to secure in English speaking common law jurisdictions, the Dutch courts award these arrest orders quite readily, giving plaintiffs in Dutch proceedings a high degree of security and certainty regarding their ability to execute a judgment if it is handed down in their favour.

This makes The Netherlands a particularly attractive forum for claimants with a cause of action against a Dutch defendant. The Netherlands are also an ideal forum for litigation in which the defendant or its assets are not located in the Netherlands. It is little known that Dutch court judgments are amongst the most widely enforceable judgments worldwide.
Thanks to instruments such as the Brussels Regulation, the Lugano Convention and the Hague Convention on the recognition and enforcement of foreign judgments in civil and commercial matters, Dutch court judgments are easily enforceable in over 30 other jurisdictions, including 5 outside the European Union. In addition to this, Dutch decisions are generally also enforceable in the United States (most states), Canada, Singapore, Hong Kong, Australia and New Zealand. This makes a Dutch judgment enforceable and valuable well beyond the borders of The Netherlands.

Why the Netherlands Commercial Court?

Netherlands Commercial Court - the pros

Specialized Dutch judges
English or Dutch as the language of proceedings
Effective and shorter proceedings
Ability to bifurcate proceedings into a merits and quantification of damages phase
Evidence may be tendered in French, German, English or Dutch, saving time and translation costs
No risk of high adversary party costs award if its claim are dismissed
Paperless litigation
Recovery options (prejudgment seizure)

Commercial Court or arbitration?

Arbitration has become an extremely popular method of dispute resolution in international commercial matters for a number of reasons: it offers parties the opportunity to conduct proceedings in a language of their choice, to select a neutral venue and to have their matter heard by arbitrators with commercial experience. The Netherlands Commercial Court will offer parties the ability to litigate in English before experienced judges with technical and commercial expertise and experience and to have their matter heard by the courts of a legal system which is unrivalled in terms of independence, efficiency and impartiality. Parties do not have to have any links to the Netherlands in order to submit a matter to the NCC, making the NCC an ideal venue for parties from two different states looking for a “neutral” third state to act as a venue for their litigation.

Why litigate in The Netherlands?

The civil legal system of the Netherlands was ranked highest of all civil justice systems in the world in the World Justice Project (WJP) 2015 Rule of Law Index ®, based on criteria such as cost-effectiveness, efficiency, impartiality and independence.

Dutch court judgments are easily enforceable in over 30 other jurisdictions, including the entire European Union and 5 other States on the basis of EU regulations, or bilateral or multilateral treaties. In addition to this, decisions of the NCC will, as a rule, be enforceable in (most states of) the United States, Canada, Singapore, Hong Kong, Australia and New Zealand.

Planning of the Netherlands Commercial Court

The Netherlands Commercial Court Act (Wet Netherlands Commercial Court) is slated to come into force during the course of 2018.

The Netherlands Commercial Court has come one step closer to fruition on the 8th of March, 2018, when the Second Chamber of the Dutch parliament (the House of Representatives) voted in favor of the Netherlands Commercial Court Bill. This bill contains amendments to the Dutch Code of Civil Procedure to provide for the use of English as the language of proceedings and to allow the “international commercial chamber” of the Amsterdam District Court and Court of Appeal (as the Netherlands Commercial Court and Netherlands Commercial Court of Appeal are referred to in the Bill) to hand down judgments in the English language.

In addition to this, the bill also provides for certain amendments to the Dutch Civil Proceedings (Court Fees) Act to provide for the special filing fees that litigants before the Netherlands Commercial Court will have to pay.

The bill is now going to be dealt with by the senate (the First Chamber of the Dutch parliament). Directly after a bill has been passed by the House of Representatives it has been sent to the Senate. Here the bill is submitted to a parliamentary committee. The committee decides whether the bill can be immediately put on the agenda of the full chamber or whether there should first be preparatory study of the bill. If a bill is immediately put on the agenda of the full chamber, it will be passed as a formality without a debate. The preparatory study of a bill consists mainly in written correspondence and the exchange of documents. The members of the committee present the views of their parliamentary party in writing and put questions to the Government. The Government replies in a note or memorandum of reply. Sometimes, there may be several rounds of correspondence, but one is generally considered sufficient.

After the written preparations have been completed, the Senate is notified that the bill is ready for debate by the full chamber. In due course the bill is then put on the plenary agenda.

So, the Netherlands Commercial Court seems to be on track to open its doors during the course of 2018.

Notwithstanding the delays in the launch of the NCC, support for the first fully English language commercial court in the Netherlands is strong. The strong political support for the initiative is apparent from the discussions of the Standing Committee, with Christian Democrat Madeleine van Toorenburg MP underlining the importance of the Netherlands Commercial Court, in particular with the Brexit on its way. This was echoed by Mr Foort Van Oosten MP, who cited the value of the NCC as a vehicle to promote the exemplary Dutch legal system and to attract litigation from other jurisdictions to the Netherlands. According to Mr Van Oosten, this is in keeping with the Netherlands’ history as a country with a tradition of international trade and an international legal profession.