NETHERLANDS Law and Practice Contributed by: Mandeep Lotay and Dámaris Engelschman, Freshfields LLP
Freshfields LLP Strawinskylaan 10 1077 XZ Amsterdam The Netherlands Tel: +31 204 857 000 Web: www.freshfields.com
of the assets to the SPV is funded by the SPV through the issuance of (different tranches of) secured notes or borrowing money under senior and subordinated secured loan arrangements. Financial assets in the form of “receivables” under cash securitisations are usually trans - ferred via an assignment ( cessie ), and, more specifically, by way of undisclosed assignment ( stille cessie ), under which the obligor under the receivable is not – unless a prescribed trigger event occurs – notified of the assignment. How - ever, for legal reasons that will be touched upon under 6.1 Insolvency Laws , the separation of assets under operational lease receivables secu - ritisations usually does not primarily involve a transfer by way of assignment of the receivables – rather, alternative structures are used to trans - fer the economic interest of the receivables, such as transfer by means of hire purchase ( huurkoop ) or contract transfer ( contractsoverneming ). The various tasks/obligations that the SPV needs to perform or observe under a Dutch securitisa - tion are customarily outsourced to independent third parties, such as asset servicing and cash management, while a security trustee or agent is appointed to represent and safeguard the inter - ests of the prescribed secured creditors of the SPV as well as to hold the transaction security. To secure the financial obligations of the SPV against the various prescribed creditors of the
1. Specific Financial Asset Types 1.1 Common Financial Assets The most commonly securitised financial assets in the Dutch market are residential mortgage loans (RMBS). Other financial assets frequently securitised in the Dutch market are auto-leas - es, buy-to-let mortgage loans (B2L), consumer loans and trade receivables. Less common are equipment lease securitisations and commer - cial mortgage loans (CMBS). There is also an increasing appetite for “green” securitisations and, in particular, green RMBS transactions. The volume of green RMBS securitisations issues in the Netherlands rose from EUR0.5 billion in 2022 to EUR1.4 billion in 2023, and we see this increasing in the coming years. 1.2 Structures Relating to Financial Assets The typical structure for securitisations for cash RMBS, B2L, auto-lease and consumer-loan financial assets entails the sale of the assets by an originator (or financial-asset owning compa - ny) to a special purpose vehicle (SPV) by way of a legal “true sale” which usually, but not neces - sarily, involves an orphan SPV. This SPV is often a Dutch limited liability company established as an orphan (though not necessarily), and we see Irish as well as Luxembourg incorporated SPVs employed in Dutch securitisations. The sale
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