Commercial Litigation Q&A Country Guide

What is the court structure applicable to commercial disputes in the Netherlands?

A lawsuit concerning a commercial dispute starts at the court. There are eleven courts in the Netherlands. These are the courts in the cities of Amsterdam, Rotterdam and The Hague and in the provinces Gelderland, Limburg, Midden-Nederland, Noord-Holland, Oost-Brabant, Overijssel and Zeeland-West-Brabant. In civil law, the subdistrict court (kantonrechter) handles civil cases up to and including € 25,000, employment cases, rent cases, consumer purchase cases and consumer credit cases.

Anyone who disagrees with a court ruling of the court or the subdistrict court may appeal. An appeal against a decision of a civil (subdistrict) court is possible for three months after the judgment. There are four courts of appeal: Court of Appeal Amsterdam, Arnhem-Leeuwarden, The Hague and ‘s-Hertogenbosch.

The Supreme Court is the highest court in the Netherlands. The Supreme Court is not a third authority but a court of cassation. This means that the Supreme Court assesses whether the course of facts has been correctly interpreted and applied to the law.

Who decides questions of law and fact in the Dutch courts?

In a commercial dispute, the judge makes a binding decision that all parties must abide by. The judge investigates the conflict and rules on the issue. The judge will play an inquisitorial role and ask questions of both parties. In the Netherlands, we do not have a jury.

As a court of cassation, the Supreme Court answers legal questions and thus contributes to the development of the law and legal protection. It also ensures legal uniformity.

What is the nature of legal representation in the Netherlands? Do foreign attorneys have a right of audience in the Dutch courts?

In commercial disputes that take place before a subdistrict court, legal representation is not mandatory. Proceedings can then be conducted in person (self-representation) or the client can be represented by another person.

In commercial disputes that take place before a court of law, a court of appeal or the Supreme Court, representation by an attorney is mandatory.

In the Netherlands, there are no legal provisions that allow foreign attorneys to represent their client in Dutch courts. However, in appropriate cases, the judge could agree that a Dutch attorney is assisted by a foreign attorney in the legal proceedings of a case.

What types of legal fee arrangements are generally adopted by Dutch attorneys? To what extent are legal fees fixed by law?

Dutch attorneys can decide for themselves which financial arrangements he or she will agree upon with the client. Common fee structures are:

• On the basis of an hourly rate. The fee is determined by multiplying the number of hours the attorney worked on the case by the hourly rate. A law firm may use a fixed hourly rate, or different hourly rates for each type of attorney, depending on their experience.
• Depending on the result. The attorney can agree on two rates with his client: a lower rate if the objective is not achieved, a higher rate if the objective is achieved.
• A fixed fee / flat fee. The client agrees to a fixed total amount with the attorney in advance.
• Collection rate. In a debt collection case, an attorney collects money on behalf of his client from others. He then receives a certain percentage of the collected amount.

Other methods, or a combination of the above methods, are also possible, as long as they do not violate the existing rules of professional conduct of the attorney. The ‘No cure no pay’ method is not allowed in the Netherlands.

What are the time limits applicable to commercial disputes in the Netherlands?

A legal claim (rechtsvordering) is subject to limitation and absolute periods established by Dutch law.

The limitation period is the period of inactivity of the holder of a subjective right, after the expiry of which he can no longer request the legal protection of that right. The expiry of the limitation period does not extinguish the subjective right itself, but rather the right associated with it to bring actions and to request enforcement measures, thus making the right a natural right (substantive right that does not enjoy legal protection). The statute of limitations is not applied automatically, but only after an objection by the debtor before the court.

A general limitation period of five years applies to all claims for which no special period has been laid down (Article 3:310 Dutch Civil Code).

Are there any pre-action discovery procedures available to a party who wishes to initiate a claim?

If a party is aware of the contents of a piece of written evidence but does not have it in his possession, he may, if he wishes to produce it in proceedings, institute a claim pursuant to Article 843a Code of Civil Procedure. This claim can be lodged both in the course of ongoing proceedings (by raising an incident) and prior to proceedings (by way of summary proceedings).

The applicant must meet three cumulative conditions: (i) the applicant must have a legitimate interest in obtaining an inspection, an extract or a copy; (ii) the request must concern certain documents; and (iii) the request must concern documents relating to a legal relationship to which the applicant is a party.

What role does mediation play in the litigation process? Is mediation imposed as a prerequisite to a commercial claim or is strongly encouraged by the Dutch Courts?

Mediation prior to the hearing is not mandatory in the Netherlands. However, during the court hearing, the judge will actively explore with all parties which solution method seems to fit best in this situation: judgment, settlement or mediation.

How is a commercial claim initiated in the Dutch courts?

The bailiff serves, at the request of the plaintiff, a writ of summons (dagvaarding) on the defendant. In this writ the defendant is summoned to appear in court on a day and time as mentioned in the writ. The defendant has to give a response to the writ of summons within six weeks and will present a statement of defense (conclusie van antwoord).

In 99,9% of all cases an oral hearing is considered necessary by the court. The oral hearing is often 3-5 months later. The judge will usually give judgment within six weeks. This is a final (or interlocutory) judgment on the basis of a full analysis of all factual and legal issues involved in the case.

What happens if a defendant fails to respond to a claim?

If the defendant has not appeared in the proceedings, the judge will render a default judgment. In most cases, the judge will award the claims described in the summons, unless they appear to be unlawful or unfounded.

Sometimes the defendant can still “clear” the default. This can be done during the period in which the judge has granted the default and the final judgement will be rendered.

If clearing the default has not taken place or is not possible, the defendant may enter an objection (in verzet gaan) (Article 143 Dutch Code of Civil Procedure). The defendant must then summon the plaintiff (de verzetdagvaarding). This summons for opposition is actually a statement of reply.

Are there any summary procedures which can be applied for by the plaintiff or defendant in a commercial claim?

Yes, however, the following three requirements must be met:

• the existence of the claim and the extent of the claim are highly plausible;
• there is an urgent interest that requires immediate relief; and
• there is no risk of restitution.

What interim reliefs can a party seek to maintain the status quo or prevent further loss or damage pending the final decision of the court?

Dutch law provides the opportunity to request short-term measures before or during court proceedings.

Even if a creditor has not yet obtained a right to enforcement, that creditor may – in general without involvement of the debtor – attach any assets of his debtor under a pre-judgment attachment.

Other possible interim reliefs are monetary or injunctions which order the defendant to do something or to refrain from doing something. Injunctions can be enforced with a penalty.

What sort of evidence is required to support a commercial claim? How do the Dutch courts evaluate oral and documentary evidence?

The rules of evidence in the Dutch Code of Civil Proceedings apply as a basic rule to most civil proceedings. They do not apply in arbitration proceedings.

In most cases, the burden of proof rests on the plaintiff. In general, all evidence can be used to fulfill this burden. There are no restrictions: tape recordings, (hearsay) witness hearings, or forensic reports can all be used as evidence.

In general, Dutch courts are free in its assessment of all evidence provided.

When will a court consider expert evidence and how are expert opinions treated?

If a Dutch court lacks expertise as to a certain part of the dispute, it may appoint an expert at its discretion or at the request of a party. The court is not bound by the conclusions of experts. However, in general, Dutch courts shall follow the findings of an expert.

Will parties be able to recover the costs incurred in pursuing a claim in court?

The losing party will have to pay the court fees and bailiff costs of the successful party.

The costs of legal representation incurred in Dutch court proceedings are for the greater part at the parties’ own expense. Although the losing party will be ordered to pay the legal costs of the winning party. However, the order for costs only covers a small part of the actual costs incurred.

An exception applies to cases relating to the enforcement of intellectual property rights, in which the reasonable and proportionate legal costs incurred by the successful party shall be borne by the unsuccessful party.

How long do commercial claims take to be resolved in the Dutch courts?

In general, summary proceedings take about 5 to 8 weeks and proceedings on the merits between 12 and 15 months before a judgment is rendered in the first instance.

How can a successful party enforce a court judgment?

In the Netherlands, the bailiff is the competent authority. If a judgment is enforceable notwithstanding appeal, the successful party is authorized to enforce the judgment. There is no need to await the outcome of any appeal that may be lodged by the unsuccessful party.

Once a judgment has been served on the losing party the winning party may in principle have any and all of the losing party’s assets seized in order to satisfy that judgment (tangibles, shares, bank accounts, third-party claims and real estate).

Can an unsuccessful party appeal against a court’s decision?

The period for lodging an appeal in proceedings on the merits against a Dutch court judgment is three months from the date on which it was rendered. The lodging of an appeal suspends the contested judgment unless – as in most cases – the court declared it to be immediately enforceable. In summary proceedings, the unsuccessful party has four weeks to appeal.

The court of appeal may conduct a full review of the merits of the case. The parties are allowed to present new facts, new legal arguments and new evidence.

How do Dutch courts approach the choice of governing law in a contract in cross-border litigation?

If parties in a civil and commercial matter are not residing or established in the same country, Dutch courts will assess the governing law of contracts concluded on or after 17 December 2009 based on the Rome I-treaty.

Under the main rule of this treaty, the contract is governed by the law chosen by the parties (choice of forum). In absence thereof, the law applicable to the contract shall in general be governed by the law of the country in which the party who is to perform the characteristic performance of the agreement resides.

As to international purchase agreements concerning (most) tangibles, the United Nations Convention on contracts for the International sale of goods (CISG) applies if the buyer and seller are resident in contracting states, or if the rules of private international law lead to the application of the law of a state party to the CISG.

Are foreign judgments recognised by the Dutch courts?

A judgment given in an EU member state and enforceable in that state is enforceable in the Netherlands through a Dutch bailiff, without any declaration of enforceability or other court action being required.

A judgment given in a non-EU country is not enforceable in the Netherlands except if a treaty between the Netherlands and the relevant country exists.

If no treaty applies, proceedings on the merits have to be initiated. However, Dutch courts will generally issue an enforcement order provided that the foreign court assumed jurisdiction correctly and the standards of fair trial were met. If that is not the case, the case must be re-litigated in new proceedings on the merits.

How have the Dutch courts responded to the Covid-19 pandemic to ensure that the litigation process remains effective while ensuring the health and safety of those involved in the process?

Trials continue. All courthouses have been made Covid-19 proof and equipped to maintain a distance of 1.5 meters. Parties and visitors are required to wear a face mask in the public areas of the court.