NETHERLANDS Law and Practice Contributed by: Marcel Willems and Rowan Hamer, Fieldfisher
more creditors of the legal entity, withdrew any prop - erty from the estate prior to or during the bankrupt - cy, or excessively consumed, spent or disposed of resources of the company. 8. Setting Aside or Annulling a Transaction 8.1 Circumstances for Setting Aside a Transaction or Transfer Dutch law distinguishes between non-obligatory and obligatory legal acts when it concerns the set - ting aside of transactions, such as credit and security transactions and asset sales. A legal act can be set aside extrajudicially (for instance by letter) if the debtor performed the act without being obliged to do so by statute or contract before the declaration of bankruptcy and if they knew, or should have known, at the time of performing the act that it would prejudice the creditors (actio pauliana). When the legal act involves an exchange (ie, there was some form of counter-performance), the act can only be set aside if the counterparty involved also knew or should have known that the transaction would disadvantage creditors. In such cases, it is the bankruptcy trustee’s responsibility to prove that both the debtor and the counterparty had this knowledge. For certain voluntary legal acts, the law provides pre - sumptions of knowledge where it is assumed that both parties to the transaction were aware the action would harm the company’s creditors. In cases where the legal act involved an exchange and was performed within one year before bankruptcy was declared, this presumed knowledge applies if: • the agreement is imbalanced, with the debtor’s obligation significantly exceeding that of the coun - terparty; • the debtor makes or secures payment for a debt that is not yet due; or
• the debtor, if a legal entity, conducts the transac - tion with or involving a natural person, such as a director or supervisory director of the entity. For acts made without any counter-performance with - in one year before bankruptcy, it is presumed that the debtor either knew or should have known that the transaction would harm creditors. The payment of a due debt, which is an obligatory legal act, can only be set aside if it is proved that the person who received the payment knew that the debtor’s petition for bankruptcy had already been filed, or that the payment was the result of consulta - tion between the debtor and this creditor, with the aim of favouring the creditor over other creditors through the payment. 8.2 Claims to Set Aside or Annul a Transaction or a Transfer The consequence of a successful actio pauliana is that, on the basis of the legal act that has been set aside, an amount paid was unduly paid, and must be repaid. If the setting aside results in an asset returning to the estate, for example because the title to a trans - fer lapses, the trustee can revindicate in the event that it is not returned voluntarily. In a bankruptcy procedure, only the trustee can invoke an actio pauliana. If a WHOA procedure took place prior to the bankruptcy, the trustee cannot set aside a legal transaction with a third party if this was approved by the court. For example, the court may have granted authorisation for new financing, including providing security to the financier that was necessary to contin - ue the debtor’s business during the WHOA procedure. Outside of a bankruptcy procedure, individual credi - tors can invoke the civil law action pauliana. In princi - ple, the civil pauliana can also be invoked in restruc - turing procedures, but is unlikely to be successful if the court has granted authorisation to perform the contested legal act.
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