Background

Frequency of use

How common is commercial litigation as a method of resolving high-value, complex disputes?

Commercial litigation is a common method to resolve disputes between parties in the Netherlands. In 2017, 68,000 cases and in 2018, 61,000 cases that were filed at the district courts (which are the courts of first instance) were registered as commercial cases. Despite this number, the majority of disputes were settled out of court.

Litigation market

Please describe the culture and ‘market’ for litigation. Do international parties regularly participate in disputes in the court system in your jurisdiction, or do the disputes typically tend to be regional?

As a lot of international companies are structured via Dutch holding companies, international parties regularly participate in disputes before Dutch courts. The primary reasons for choosing this structure relate to Dutch tax efficiency, the flexibility of Dutch corporate and tax law and the relatively low cost of incorporation and annual maintenance. In addition, Dutch courts do not hesitate to render judgments in important and politically sensitive cases, such as the Yukos affair.

Disputes are becoming increasingly international in the Netherlands as it is considered one of the most attractive jurisdictions in the European Union for cartel damages litigation and an attractive venue for settling international mass claims, regardless of whether any class action litigation has taken place.

This trend in internationalisation will likely get a further boost as the specialised Netherlands Commercial Court (NCC) has been incorporated (see question 56).

Legal framework

What is the legal framework governing commercial litigation? Is your jurisdiction subject to civil code or common law? What practical implications does this have?

The Dutch jurisdiction is subject to its Civil Code. Commercial litigation in the Netherlands is mainly regulated by the Code of Civil Procedure (CCP). Furthermore, the Law on Judicial Organisation regulates the subject-matter competence of the different courts. As the Dutch jurisdiction is subject to the Civil Code, there are no jury trials in the Netherlands. It is Dutch legal tradition to rely on judges’ independence and professionalism. One of the basic principles is party autonomy, meaning that it is up to the parties to determine the scope of the case.

Bringing a claim - initial considerations

Key issues to consider

What key issues should a party consider before bringing a claim?

Although the costs of civil litigation in the Netherlands are generally lower than, for example, in the US and the UK, they can still be significant. The party found to be in the wrong is usually ordered to pay the costs to the prevailing party, including the court registry fee and experts’ and attorneys’ fees. It is important to note that the attorneys’ fees in civil cases are calculated on the basis of a court-approved scale of costs and not the actual costs. This usually leads to remuneration that only covers a small amount of the actual attorneys’ fees incurred.

Another relevant consideration relates to the scope of Dutch discovery, which is narrower than what is available in the US and the UK. As a result, Dutch proceedings are generally less costly and time-consuming, but parties might have more difficulty in obtaining additional evidence from their counterparty.

Establishing jurisdiction

How is jurisdiction established?

Whether a Dutch court has jurisdiction has to be established by European regulations, by international conventions or treaties and by Dutch rules of international private law.

The most important EU regulation is Regulation (EU) No. 1215/2012 on jurisdiction and the recognition of judgments in civil and commercial matters (EEX recast). The EEX recast applies if the defendant is domiciled in a EU member state or if one of the exclusive jurisdiction clauses applies. In the EEX recast (and the CCP), the key principle is that the defendant must be brought before the court of the jurisdiction where the defendant lives or is situated. The CCP and EEX recast have alternative competence rules if, for instance, parties have agreed upon a contractual choice of forum.

The European Court of Justice has ruled that parties do not have the possibility to argue that under the EEX a court lacks jurisdiction because a court in another jurisdiction would be more convenient or appropriate (Owusu v Jackson) and an antisuit injunction is an inadmissible interference with the jurisdiction of the court that is targeted by such injunction (Turner v Grovit).

Preclusion

Res judicata: is preclusion applicable, and if so how?

Preclusion is applicable in the Netherlands. The preclusive effect of a judgment concerns the binding effect of judicial findings contained in judgments in other proceedings. New actions between the same parties regarding the same claim are not prevented as such, but the preclusive effect may lead to dismissal of the claim.

Applicability of foreign laws

In what circumstances will the courts apply foreign laws to determine issues being litigated before them?

The most important regulations that govern the applicable law for EU members are Rome I (Regulation (EC) No. 593/2008) with respect to agreements and Rome II (Regulation (EC) No. 864/2007) with respect to extra-contractual liability. In international commercial contract cases, the applicable law and competent courts are usually decided by the choice of law and forum choice provisions in the relevant agreement. This can result in Dutch courts having to apply foreign law. Dutch courts can request information on applicable foreign laws from the competent authority in the country concerned. Further, parties must provide the Dutch courts with information regarding the contents and implications of the foreign law and may use all means to do this (parties will usually submit written legal opinions). Foreign law will only apply to the merits of the case. Procedural issues are governed by Dutch law.

Initial steps

What initial steps should a claimant consider to ensure that any eventual judgment is satisfied? Can a defendant take steps to make themselves ‘judgment proof’?

To safeguard successful enforcement of a court decision, a claimant may apply for an order authorising a prejudgment attachment on the defendant’s assets (see question 9). Furthermore, a claimant can - under certain circumstances - claim security for costs (see question 29).

Freezing assets

When is it appropriate for a claimant to consider obtaining an order freezing a defendant’s assets? What are the preconditions and other considerations?

Parties may request the president of the competent court to give permission for a prejudgment attachment, garnishment or arrest of assets of a defendant located in the Netherlands. Usually, obtaining leave in the Netherlands is relatively easy. In most cases, ex parte proceedings are followed, meaning that the counterparty will not be heard by the judge before the leave is granted. The request of attachment contains, among other things, the nature of the attachment (third-party attachment, etc), the legal basis and the extent of the claim. The president of the district court will apply a rather marginal test of the request of attachment.

After the leave for attachment is granted, the claimant is obliged to initiate proceedings against the defendant within a certain period of time (if proceedings have not already been initiated). If the claimant does not timely initiate the proceedings, the prejudgment attachment will be lifted automatically.

The prejudgment attachment prohibits the debtor or defendant from alienating the attached property. Furthermore, an attachment usually exerts substantial pressure on the defendant (which may be conducive to settlement talks).

If the claim for which the prejudgment attachment was granted is rejected in the main proceedings, the attachment lapses automatically and the creditor can be held liable for the damages that the debtor incurred as a result of the unlawful attachment.

Pre-action conduct requirements

Are there requirements for pre-action conduct and what are the consequences of non-compliance?

In the Netherlands there are no formal pre-action protocols that set out the steps parties must take before commencing civil proceedings (such as in the UK, for example). As a result, there is no letter before action that needs to be send before starting proceedings. However, rules of conduct for a Dutch lawyer may imply that, under certain circumstances, a prior notice is sent to prevent unnecessary proceedings and enforcement.

Other interim relief

What other forms of interim relief can be sought?

The following provisional measures are regularly requested in summary proceedings:

  • an order obliging the defendant to resume performance of a continuing contractual obligation;
  • advance payments (provided that the claim is undisputed or at least easy to establish);
  • an injunction against infringement of an intellectual property right; and
  • seizure of evidence.
Alternative dispute resolution

Does the court require or expect parties to engage in ADR at the pre-action stage or later in the case? What are the consequences of failing to engage in ADR at these stages?

During proceedings, Dutch courts often actively encourage mediation, as litigation is considered to be a last resort. Parties are free, however, to engage in such mediation. There are no legal consequences for failing to engage in mediation.

If parties have agreed to arbitration in a contract, the route to the court is not per se closed. A court will only declare a case inadmissible if one of the parties files a motion for inadmissibility due to the arbitration clause.

Claims against natural persons versus corporations

Are there different considerations for claims against natural persons as opposed to corporations?

A party that wishes to bring a claim against a natural person as opposed to a corporation has to consider that corporations are obliged to pay a higher amount of court fees. Further, natural persons tend to enjoy additional protection in certain areas such as employment and consumer law (they have, for instance, the right to appear in the competent court in the district where they are living).

Class actions

Are any of the considerations different for class actions, multi-party or group litigations?

Dutch law provides for a mechanism that facilitates the implementation of collective settlements. Parties to a settlement agreement may request the court of appeal to declare the settlement agreement binding on all persons to whom it applies according to its terms (the interested persons). The settlement agreement must be concluded between (one or more) potentially liable persons and (one or more) foundations or associations that promote the interests of the interested persons. The court may refuse to declare the settlement agreement binding if, for instance, the amount of settlement relief is unreasonable or the petitioners are jointly and insufficiently representative of (the interests of) the interested persons. If the court declares the settlement agreement binding, all persons are bound by its terms, except for persons who have submitted an opt-out notice.

Dutch law also provides for a collective action to protect the common or similar interests of parties whose rights or interests are affected. A collective action can only be instituted by an association or foundation whose articles of association promote the interests that the collective action aims to protect. Currently, only a declaratory judgment as to the liability of the defendant can be obtained. Monetary claims or claims for damages can only be brought by individual parties, but new legislation is pending that will make it possible for an association or foundation to claim damages.

Third-party funding

What restrictions are there on third parties funding the costs of the litigation or agreeing to pay adverse costs?

Third-party funding is allowed in the Netherlands. Especially in mass claims, third parties fund on a regular basis. There are no restrictions on third parties agreeing to pay adverse costs.

Contingency fee arrangements

Can lawyers act on a contingency fee basis? What options are available? What issues should be considered before entering into an arrangement of this nature?

The general rules of conduct of the Dutch Bar Association prohibit lawyers from acting on a contingency fee basis. A combination of a discounted hourly rate and a success fee is, however, permitted to the extent it does not amount to a de facto ‘no cure, no pay’ arrangement (meaning that at least the actual costs for the attorney should be covered).

The claim

Launching claims

How are claims launched? How are the written pleadings structured, and how long do they tend to be? What documents need to be appended to the pleading?

To launch a claim, a writ of summons has to be served on the defendant by a bailiff. Subsequently, the claimant has to send the writ of summons to the court. The writ of summons includes all formalities, including the day of formal appearance in court, as well as the merits of the claim.

The writ of summons could be structured as follows:

  • formalities (competent court, parties’ details, date on which the defendant has to appear);
  • introduction of the case;
  • facts of the case;
  • cause of action;
  • known arguments of the defendant;
  • evidence on which the claimant relies (exhibits and names of potential witnesses); and
  • conclusion (see question 24 for the structure of defences).

The length of the writ of summons varies from five pages in straightforward proceedings to over 50 pages in more complex litigation.

Serving claims on foreign parties

How are claims served on foreign parties?

The service of judicial documents abroad is mainly regulated by the Hague Service Convention of 1965, to which most of the Netherlands’ important trading parties - including the EU, the US and Russia - are a signatory; and Regulation (EU) No. 1393/2007, which applies in all civil and commercial matters where a judicial or extrajudicial document has to be transmitted from one EU member state to another for service there. In matters where no treaties or Regulation (EU) No. 1393/2007 apply, the route described in article 55 of the CCP has to be followed.

Pursuant to this article, persons who have no known domicile in the Netherlands, but who do have a known domicile in another country, are to be served by the court bailiff handing the writ of summons over to the Dutch public prosecutor’s office, which will send a copy of this document to the Dutch Ministry of Foreign Affairs. The Ministry will subsequently notify the foreign defendant via the diplomatic or consular officer. In addition, the bailiff must send a second copy of the writ of summons by registered mail to the defendant’s foreign address.

Key causes of action

What are the key causes of action that typically arise in commercial litigation?

The key causes of action that typically arise in commercial litigation are breach of contract, tort and negotiations that have broken down.

Claim amendments

Under what circumstances can amendments to claims be made?

The claimant is allowed to amend its claim in writing until the court announces when the judgment will be presented. The defendant may object to such amendment for the following reasons:

  • if it is contrary to the requirements of due process;
  • if it would unduly delay the proceedings; or
  • if it would unduly hinder the defendant in its defence (but not if the claim is reduced).
Remedies

What remedies are available to a claimant in your jurisdiction?

A claimant has a variety of remedies at his or her disposal, including the right to claim performance of the contract and damages. Other options available to the claimant are rescindment of the agreement due to the other party not fulfilling its contractual obligations or annulment of the agreement due to duress, fraud, undue influence, misrepresentation or error. Damages can also be claimed in addition to claiming specific performance or rescindment of the contract.

Another remedy that can be requested is a declaratory decision. This decision confirms the existence or absence of a certain legal relationship, such as a declaratory judgment that an agreement is null and void. In cases related to a breach of contract or tort, a court can also issue an injunction ordering a defendant to abstain from certain acts.

Recoverable damages

What damages are recoverable? Are there any particular rules on damages that might make this jurisdiction more favourable than others?

The prevailing party can recover all damages consisting of material loss and, if the law so provides, other harm. Pecuniary damages include both losses and forgone profits. In the Netherlands, the prevailing party cannot claim punitive damages unless there is a contractual basis.

If the prevailing party or the court is not able to determine the exact amount of damages, the damages can be estimated. The court can also refer to special follow-up proceedings for the determination of the exact amount of damages.

Responding to the claim

Early steps available

What steps are open to a defendant in the early part of a case?

A defendant has a variety of options to respond to the writ of summons, such as a motion challenging the jurisdiction of the court and a motion to join an indispensable third party. These motions must be filed before presenting the defence on the merits. A defendant can also present his or her counterclaim. The counterclaim must be first initiated in the statement of defence and then also in the statement of claim in the rejoinder proceedings.

Defence structure

How are defences structured, and must they be served within any time limits? What documents need to be appended to the defence?

Generally, after the writ of summons of the claimant the defendant has to respond to the writ of summons within six weeks in his or her statement of defence. An extension of this time frame is possible if parties unanimously request this or if one of the parties is able to demonstrate that there are compelling reasons to grant an extension.

There is no fixed structure for a defence. A typical defence would include the following chapters:

  • introduction;
  • facts;
  • formal defences (eg, challenging jurisdiction);
  • substantive defences;
  • counterclaim;
  • offer of further evidence; and
  • conclusion.

The defendant has to substantiate its defence with documents (exhibits) and (optional) tender evidence by witnesses.

Changing defence

Under what circumstances may a defendant change a defence at a later stage in the proceedings?

A defendant is allowed to supplement and change its defence in the course of the proceedings (although this might affect his or her overall credibility). However, after the statement of defence, there may not be another opportunity for the defendant to adjust his or her defence. In the appeal, the defendant is allowed to supplement and correct anything he or she did bring forward or failed to bring forward in the proceedings in first instance. The basic principle is that parties must present new arguments ultimately at the first opportunity in the appeal.

Sharing liability

How can a defendant establish the passing on or sharing of liability?

A defendant is allowed to initiate ancillary proceedings to request an impleader of a third party. Should a defendant wish to request an impleader, he or she must file a motion to that effect before presenting any of his or her substantive arguments and defences. The motion must establish that the claim against the third party is dependent on the claim in the main proceedings, and that the impleaded party has a duty to hold harmless and indemnify the original defendant in the event that the latter is unsuccessful in the proceedings against the claimant.

Avoiding trial

How can a defendant avoid trial?

The most common way to avoid trial in the Netherlands is for a defendant to agree on an amicable settlement. If no amicable settlement can be reached, parties have various alternatives to litigation such as mediation and the Dutch concept of binding advice.

In the Netherlands, there is no legal framework for mediation. The EU has, however, adopted Directive 2008/52/EC on certain aspects of mediation in civil and commercial matters in cross-border disputes, which is implemented in Dutch law.

Binding advice is based on a contract between parties. By a contract, parties agree in advance to be bound by the decision given by one or more third parties who have been appointed by the parties as binding advisers (this could also be an expert determination). Parties who have agreed to refer a matter to binding advice cannot submit a claim before state courts or in arbitral proceedings. As the binding advice is part of the parties’ agreement, the party that fails to comply with the advice is in breach of contract. This means that the only available remedy for the other party is to claim specific performance of the agreement or damages.

Finally, if proceedings are initiated by the plaintiff, the defendant can raise certain formal defences. The most commonly raised formal defence is challenging the jurisdiction of the court. Further, if a defendant is able to present a substantial and credible counterclaim, this often encourages the plaintiff to engage in (or reopen) settlement negotiations.

Case of no defence

What happens in the case of a no-show or if no defence is offered?

If the defendant does not appear when summoned appropriately, the court may render a default judgment. The court will adjourn the proceedings for a period of four weeks in order to verify whether all legal formalities have been fulfilled with respect to the summons and the service of process by the bailiff.

The court will assign the claim to the defendant against whom default has been rendered unless the court deems the claim unlawful or unfounded. In practice, the review by the court is very marginal and claims entered in default are usually allowed. The default judgment has immediate effect, meaning that it can be executed right away. Dutch law provides for an action to have a default judgment set aside. The defendant has to issue a notice of objection to the original plaintiff. The term for issuing this notice is four weeks if the defendant is domiciled in the Netherlands and eight weeks if the defendant is domiciled abroad after the default judgment has been served. The notice must contain all formal and substantive defences. As a result of the objection the case will be reopened.

If the defendant appears in court but fails to offer any defence, which would rarely be the case, the court will admit the claim assuming that the (uncontested) facts raised by the plaintiff support the claim.

Claiming security

Can a defendant claim security for costs? If so, what form of security can be provided?

Claimants who are not residents of the Netherlands who bring a claim before a Dutch court can, at the request of the defendant or defendants, be obliged to provide security for trial costs, or damages that they might have to pay in the event that the court awards those costs to the defendant or defendants. However, security for costs is only available if the claimant resides in a jurisdiction that does not have an enforcement treaty with the Netherlands. Given the large number of countries that the Netherlands has such a treaty with (most notably, the Hague Convention relating to Civil Procedure of 1954 and the Friendship, Commerce, and Navigation treaty with the US), it will seldom be possible for the defendant to successfully claim security for costs.

Progressing the case

Typical procedural steps

What is the typical sequence of procedural steps in commercial litigation in this country?

Dutch civil proceedings will be initiated by sending the writ of summons of the claimant to the Dutch court (see question 17). After the writ of summons, the defendant will have the opportunity to submit a statement of defence. The statement of defence may include a counterclaim, which typically will be dealt with by the court at the same time as the original claim.

The court usually orders a personal appearance of the parties in court. In such personal appearance, the parties may provide further information (additional exhibits can be submitted in advance of the hearing) and the court may examine whether an amicable settlement can be reached. The court may also grant permission to hear witness and party-appointed experts. The court may render its judgment after the personal appearance of parties (in cases where a settlement has not been reached). In more complex matters, the court, of its own motion or on application by the parties, may allow parties to exchange further written briefs or order an additional appearance of the parties in court.

An appeal against the final judgment would need to be lodged within three months of the date of the final judgment. An interim judgment can only be appealed together with the final judgment, unless the court has indicated this in its interim judgment, or has granted leave afterwards.

Bringing in additional parties

Can additional parties be brought into a case after commencement?

There are two types of situations that lead to a joinder of parties. The first situation is that of an impleader of a third party by the defendant (see question 26). The second situation concerns a voluntary joinder or intervention. A third party can file a motion to request the court to allow the joinder or intervention before or on the day that the last written statement is due to be submitted. The third party will be permitted to join or intervene if it can demonstrate that it has a legitimate interest that might be affected by the decision in the main proceedings.

Consolidating proceedings

Can proceedings be consolidated or split?

Before raising any other defences, parties may request the court to refer a case to another court if an action is already pending before the other court and between the same parties in respect of the same subject matter, or if such action is closely connected to the action sought to be referred. The same applies for situations where two cases are pending before the same court.

Proceedings can also be split, although this does not occur often. The reasons for a split are usually of a technical judicial nature.

Court decision making

How does a court decide if the claims or allegations are proven? What are the elements required to find in favour, and what is the burden of proof?

The court may base its ruling only on facts that are made plausible in the course of the proceedings (ie, proven), that are undisputed by the parties, or that are generally known and require no evidence. Facts alleged by one party and not sufficiently disputed by the counterparty are regarded as established facts.

In general, the burden of proof lies with the party that invokes a certain legal consequence. This party must prove the requisite facts and circumstances unless a special rule or the principle of reasonableness and fairness require the burden of proof to be divided differently between parties.

The court has discretion in determining whether the evidence presented is sufficient. Parties are, in general, free to contractually agree as to what constitutes sufficient evidence.

How does a court decide what judgments, remedies and orders it will issue?

If the court decides that the claim or counterclaim is proven it can, in whole or in part, allow the claim. The court is bound to the wording of the claim of the plaintiff (and the counterclaim of the defendant). This means that the court is not allowed to order remedies that go further than the remedies sought by the applicant or applicants.

Evidence

How is witness, documentary and expert evidence dealt with?

Evidence may be presented through documents. Certain documents, such as notarial deeds, furnish conclusive evidence of their content. The court must, in principle, accept the contents of the act or deed as true. Parties have, however, the opportunity to present counter-evidence against exclusive evidence, unless such possibility is excluded by law.

The examination of witnesses may be ordered by the court at the court’s own initiative or at the request of one of the parties. In general, a court will allow a request for witness examination. Although witnesses are most commonly heard during legal proceedings, they may be heard in a preliminary hearing. This is a separate procedure that can be initiated before or during the main proceeding itself. This preliminary hearing can be used to assess whether a party has a strong case. It can also be used as a tactical safeguard against the loss of evidence in the course of proceedings (such as memory loss).

Witness statements prepared by the parties themselves are becoming more common, but tend not to have the same probative value as the records of a hearing in court where witnesses testify under oath.

In cases involving technical aspects, parties may submit reports by party-appointed experts. The court also has the opportunity to appoint an independent expert. In that case, parties have the opportunity to comment on the expert’s findings.

How does the court deal with large volumes of commercial or technical evidence?

Dutch courts usually have no problem with large volumes of technical evidence. It is up to the parties to ensure that their written submissions include clear and comprehensible information on the conclusions of the evidence and the location of the relevant sources in the case file.

Can a witness in your jurisdiction be compelled to give evidence in or to a foreign court? And can a court in your jurisdiction compel a foreign witness to give evidence?

Whether a witness in the Dutch jurisdiction can be compelled to give evidence in or to a foreign court depends on the relevant treaty the Netherlands has with the other country. Virtually all of the most important trade relations of the Netherlands are governed by Regulation (EC) No. 1206/2001 and the Hague Convention 1970.

Courts of EU member states (with the exception of Denmark) can request assistance directly from Dutch courts under Regulation (EC) No. 1206/2001. Requesting courts can ask the other member states’ courts to take evidence on their behalf or ask that they be permitted to take evidence themselves.

The Netherlands is also a party to the Hague Convention 1970. The Convention provides for several methods of obtaining evidence abroad, such as letters of request and the taking of evidence by diplomatic employees.

Vice versa, in Dutch proceedings, if a witness is domiciled in a foreign country, the court may request either the competent authority of that country or a Dutch consular to examine the witness. Alternative means of hearing witnesses may arise from relevant regulations and bilateral treaties with the other country.

How is witness and documentary evidence tested up to and during trial? Is cross-examination permitted?

Dutch proceedings have no discovery in the strict sense and parties are, in principle, free to determine which documents they want to use in support of their claims and defences. A party that bases its claim or defence on a particular document is obliged to give a copy thereof to the opposing party. Each party is entitled to demand inspection of the original document. If this is the case, the other party is obliged to deposit the document at the court’s registry.

Cross-examination is not part of the Dutch legal culture, and it is not practiced in state courts except in limited instances under the Hague Convention 1970. The hearing of witnesses in the Netherlands proceeds on the principle that the judge leads the hearing. In practice, however, the court nearly always grants the lawyers of parties the opportunity to ask questions (but this remains at the discretion of the judge).

Time frame

How long do the proceedings typically last, and in what circumstances can they be expedited?

The completion of proceedings in a court of first instance usually takes between six months and two years. In 2018, it took on average 37 weeks at first instance and 62 weeks in appeal to reach a decision in commercial proceedings.

The court determines the progress of the case. Parties have limited possibilities to expedite the case, other than making their objections known to, for instance, requests for postponement, witness hearings and the opportunity to have additional written or oral rounds.

Gaining an advantage

What other steps can a party take during proceedings to achieve tactical advantage in a case?

Parties can request the court to first render a partial judgment on, for instance, one or more specified claims. The courts, however, have full discretion in determining whether they render a partial or final judgment.

Impact of third-party funding

If third parties are able to fund the costs of the litigation and pay adverse costs, what impact can this have on the case?

As long as third-party litigation funders are not a party to the litigation, there is no formal impact on the case. Third-party litigation funders cannot be held liable for adverse costs and cannot be ordered to provide security for costs.

Impact of technology

What impact is technology having on complex commercial litigation in your jurisdiction?

Technology is becoming increasingly important in Dutch courtrooms. It is, for example, possible to use digital presentations during hearings to support a case. The Amsterdam Court of Appeal initiated a pilot in which certain specially selected hearings and judgments can be followed by the public via live streaming. We note that a pilot is currently ongoing in some courts in the Netherlands to implement digital proceedings in the Netherlands. Given the complexity of the problems experienced during the pilot, however, the Dutch Council for the Judiciary has announced that it will end this pilot, and at this moment will not seek to implement digital proceedings in civil cases.

Parallel proceedings

How are parallel proceedings dealt with? What steps can a party take to gain a tactical advantage in these circumstances, and may a party bring private prosecutions?

Related parallel proceedings, such as regulatory or criminal proceedings, have no formal impact on commercial litigation proceedings. However, parties can try to gain a tactical advantage by using information gathered via, for example, criminal proceedings in commercial litigation proceedings. A party may not bring private prosecutions in the Netherlands.

Trial

Trial conduct

How is the trial conducted for common types of commercial litigation? How long does the trial typically last?

See question 30 (on proceedings) and question 50 (on the duration of proceedings).

Use of juries

Are jury trials the norm, and can they be denied?

There are no jury trials in the Netherlands.

Confidentiality

How is confidentiality treated? Can all evidence be publicly accessed? How can sensitive commercial information be protected? Is public access granted to the courts?

Evidence, including exhibits, is not publicly accessible in the Netherlands. However, civil trials are open to the public, unless the court decides otherwise. The court may hold the hearing in a closed session if it is of the opinion that this is in the interests of public policy, state security, minors or the privacy of the participants, or if public access would seriously impede the proper administration of justice. Recently, a pilot has started in which high-profile commercial cases are broadcast via livestream.

Media interest

How is media interest dealt with? Is the media ever ordered not to report on certain information?

The media is allowed to visit the trial unless the court decides otherwise. There are specific guidelines for the media that aim to safeguard the public nature of the court system and the privacy of all those involved. The press guidelines are available at www.rechtspraak.nl/SiteCollectionDocuments/Press-Guidelines.pdf.

Proving claims

How are monetary claims valued and proved?

According to the Dutch Civil Code, all damage consisting of material loss and other harm, if applicable, must be compensated. Material loss consists of losses and forgone profits. The basic principle is that the claimant or aggrieved party must be placed in a situation similar to that which it would have been in if the action that caused the damage had not taken place. The court calculates the damages in the way that is most consistent with the nature of the damage caused. If the damages cannot be calculated exactly, the damages can be estimated by the court.

The assessment of damages normally takes place in the principal proceedings. However, if, for example, determination or estimation of the damages is not possible, or would be very difficult to ascertain, the court can refer the case to follow-up proceedings for the determination of the damages.

Post-trial

Costs

How does the court deal with costs? What is the typical structure and length of judgments in complex commercial cases, and are they publicly accessible?

A Dutch court does not award full compensation for the costs of litigation to the winning party (unless there are special circumstances that constitute, for instance, bad faith litigation). Furthermore, in civil cases fixed court registry charges must be paid up front, depending on the value at stake.

A typical judgment in commercial cases would include the following chapters:

  • course of proceedings;
  • facts;
  • dispute;
  • assessment claims and counterclaims; and
  • ruling on claims and counterclaims.

Further, the majority of the judgments are (in anonymous form) accessible at www.rechtspraak.nl.

Appeals

When can judgments be appealed? How many stages of appeal are there and how long do appeals tend to last?

In principle, an appeal is possible against all judgments rendered at first instance as long as the financial interest of the case exceeds, or is likely to exceed, €1,750. An appeal against a final judgment, combined with an appeal against any preceding interim judgment, would need to be lodged within three months from the date of the final judgment. A separate appeal against an interim judgment is only allowed in cases where the court has indicated this in its judgment, or has granted leave afterwards (following a request by one of the parties). Between 10 and 15 per cent of all first instance judgments involving commercial claims are appealed. In 2018, the average duration of an appeal in commercial cases was 62 weeks, and 78 per cent of the appeals were completed within two years. Appeals against court of appeal decisions may be lodged with the Supreme Court within three months of the date of the court of appeal’s judgment. There is no requirement to obtain the court of appeal’s leave before lodging an appeal with the Supreme Court. The Supreme Court may only set aside a judgment on one of two grounds: misapplication of the law or non-compliance with essential procedural requirements. The Supreme Court must accept the facts of the case as established by the lower courts. Cases before the Supreme Court last on average one-and-a-half to two years.

Enforceability

How enforceable internationally are judgments from the courts in your jurisdiction?

This will depend on the rules of the specific jurisdiction and whether the Netherlands has concluded a treaty for the recognition and enforcement of judgments. Within the EU, judgments are recognised and enforceable pursuant to Regulation (EU) No. 1215/2012.

How do the courts in your jurisdiction support the process of enforcing foreign judgments?

As a basic principle, judgments in civil matters by a court in a foreign state are not enforceable in the Netherlands unless the Netherlands and the relevant foreign state have concluded a treaty for the recognition and enforcement of judgments. Pursuant to the EEX recast, judgments made in the majority of European countries may be enforced in the Netherlands. The party that wishes to enforce the judgment must apply for a declaration of enforceability from the president of the district court. Only if recognition were to be contrary to the public order of the Netherlands would enforcement not be possible.

If there is no treaty, a full retrial will usually not be necessary if the Dutch court considers that the foreign court properly had jurisdiction; that the foreign judgment is the result of a proper judicial procedure (fair trial); and that the decision is final and does not contravene Dutch public policy. If the foreign judgment satisfies these conditions, the Dutch court will generally not review the foreign judgment as to its merits, and will render a domestic judgment that incorporates the reasoning and the decisions of the foreign judgment. This judgment may be enforced in the Netherlands.

Other considerations

Interesting features

Are there any particularly interesting features or tactical advantages of litigating in this country not addressed in any of the previous questions?

In general, the Netherlands is an attractive jurisdiction in which to litigate. The civil legal system of the Netherlands was ranked highest of all civil justice systems in the world in the World Justice Project 2019 Rule of Law Index (ranked fifth in 2019) based on criteria such as independence, impartiality, efficiency and cost-effectiveness. Dutch judgments are relatively easily enforceable in over 30 other jurisdictions (including the EU and most states of the US).

Jurisdictional disadvantages

Are there any particular disadvantages of litigating in your jurisdiction, whether procedural or pragmatic?

Recently, courts have struggled with their high-volume caseload as a result of, among other things, budgetary restraints. This sometimes translates into an increased time period for the courts to schedule hearings and to render decisions. The period of delay is usually around one-and-a-half to four-and-a-half months.

Special considerations

Are there special considerations to be taken into account when defending a claim in your jurisdiction, that have not been addressed in the previous questions?

Unlike in many other jurisdictions, the Dutch standard procedure provides for one written round and one oral round. As the statement of defence might very likely be the only written document that the defendant may submit, it is generally not recommended to hold back any defences for a later stage. Further, according to the CCP, (new) evidence needs, in principle, to be submitted no later than two weeks before the oral hearing. Violation of this principle regularly leads to evidence being excluded from the proceedings.

Updates and trends

Key developments of the past year

What were the key cases, decisions, judgements and policy and legislative developments of the past year?

Key developments of the past year56 What were the key cases, decisions, judgments and policy and legislative developments of the past year?

On 1 January 2019, the NCC was established as a special chamber of the Amsterdam District Court and of the Amsterdam Court of Appeal. The NCC is specialised in hearing complex international commercial cases and is the first fully English language commercial court in the Netherlands (proceedings and judgments are both in English). The judges of the NCC are specialised in international trade law, and are experts in handling commercial disputes, such as contract disputes, pre-contractual issues, contract breaches, rescission claims and contractual damage claims.

The NCC aims to handle complex matters within short time frames on the basis of fixed fees. Court fees are higher than standard legal proceedings in the Netherlands. However, it is a cost-effective alternative compared to having cases heard by international commercial courts in other countries. Evidence may be tendered in French, German, English or Dutch, saving time and translation costs.

On 8 March 2019, less than a month after the application was filed, the NCC issued its first judgment. After the NCC had given the judgment in this case, the lawyers representing the parties participated in a survey. The results were highly favourable about the Court’s handling of the case. Whether the NCC will indeed be a sustainable success and able to compete with the established commercial courts remains to be seen, however.

For more information, visit www.ncc.gov.nl.