International Society of Primerus Law Firms

Contracts: International litigation and arbitration will become more effective in the Netherlands

By: Reinier W.L. Russell, Esq.
Russell Advocaten B.V.
Amsterdam, Netherlands

Because of two changes in a EU regulation, as of 10 January 2015 it will become easier to make a contractual choice of forum in favour of a Dutch Court and to enforce a Dutch judgment in a EU member state. It will also become more attractive to deal with international (arbitration) cases in the Netherlands.

Simplified procedure

In order to enforce a Dutch judgment in a EU member state, you don’t need prior permission from a foreign court any longer. That means a foreign bailiff can enforce a Dutch judgment to which the new legislation applies directly and without a declaration of enforceability. This will make litigation in the Netherlands against parties with assets in other Member States more attractive. However, the other party will have the opportunity to object to the enforcement afterwards.

Agreement upon choice of forum

The court which is competent based on the choice-of-law clause included in the agreement between parties, can decide a matter directly, even if the matter was brought before a foreign court (not competent to hear the matter) before. The court which is not competent will have to keep the case on hold until the appointed court has ruled over its jurisdiction. Until now, the court before which the case was brought first had to rule over its jurisdiction first. This could slow down the settlement of a dispute a lot.

Arbitration to become more attractive

As of 1 January 2015, arbitration, an alternative method for dispute resolution, will become more attractive in the Netherlands. This shall also apply to international disputes. What will be improved?

  • It will no longer be required to register an arbitral award with the district court. From an international perspective this was quite exceptional. In addition, this requirement impeded the choice for arbitration, particularly as it involved fees.
  • It will be explicitly permitted that parties send procedural documents per e-mail.
  • In the event of a disagreement about an arbitration award or its execution, the parties will only be able to turn to one court deciding questions of fact, namely a court of appeal. Therefore, it will no longer be possible to appeal an arbitration award to a district court, followed by another appeal to a court of appeal. Parties will thus be provided with definitive assurance regarding the resolution of their dispute more quickly.
  • Parties will get more freedom to give shape to the arbitration proceedings themselves; many of the statutory provisions may be deviated from by contract.

All these provisions will make the arbitration procedure more accessible. So it will become more attractive to agree with international business partners on arbitration in the Netherlands to settle disputes.

Consumer

Based on the new consumer law, the option of arbitration will be limited in one context. In case of a dispute between an entrepreneur and a consumer, the consumer shall be entitled to one month of consideration during which he may still choose for an ordinary court. After the period of one month, arbitration will be binding.

Action

  • If you want litigation in the Netherlands, you may include that in your agreement. If the counterparty starts legal proceedings in another EU country contrary to the agreement, you may still bring the matter before the competent Dutch court which is permitted to decide on the matter directly.
  • You don’t have to litigate in the country of your contractual partner any longer in order to prevent extra steps to have a judgment executed.
  • It will become easier to include a clause in your (international) agreements in which you choose for arbitration in the Netherlands. The costs will indeed be lower and the procedure is simpler as well.

For more information about Russell Advocaten B.V., please visit the International Society of Primerus Law Firms.


The general information contained herein is intended for informational purposes only. It is not intended to be, and should not be construed as, legal advice or legal opinion on any specific facts or circumstances.

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