NETHERLANDS Law and Practice Contributed by: Herald Jongen, Maarten de Boorder, Samuel Garcia Nelen and Jelmer Kalisvaart, Greenberg Traurig, LLP
required to notify the ACM under Dutch compe- tition law. According to the Dutch Competition Act, changes of control fall within the scope of Dutch merger control regulations, which implies that the acquisition of a minority stake is not notifiable unless control is granted, for instance through veto rights or similar powers over stra- tegic decisions. A mandatory pre-closing merger filing in the Netherlands is required if the following thresh- olds were met in the last calendar year prior to the transaction: (i) the combined worldwide turn- over of the companies concerned was EUR150 million or more, and (ii) the turnover in the Netherlands of each of at least two companies concerned was EUR30 million or more. Certain sectors may have different and sector-specific turnover thresholds. Under the Dutch merger control regime, a standstill obligation applies, meaning that a proposed transaction cannot be consummated until after approval has been obtained from the ACM. The ACM decides whether a proposed transac- tion would significantly impede competition in the Dutch market, or a substantial part thereof, particularly if this would result in the creation or strengthening of a dominant market position. 7.6 Labour Law Regulations If a transaction is structured as a share deal, the acquirer obtains the target “as is”, including all employees and connected contracts and collec- tive regulations, as well as any existing labour- related obligations. In contrast, if the transaction is structured as an asset deal and, as a result, a “business” is being transferred on a going con- cern basis, all employees predominantly working for such business automatically transfer to the acquirer (the new owner) along with their appli- cable employment terms and conditions. This
automatic transfer is governed by the Transfer of Undertakings Protection of Employment ( Over- gang van onderneming or TUPE) regulations or the EU Acquired Rights Directive ( Richtlijn Over- dracht van Ondernemingen or ARD). In such scenario, the acquirer is required to honour all existing employment terms and conditions at the time of the transfer, with specific exceptions pos- sibly applying to pension arrangements depend- ing on the relevant facts and circumstances. In the event of a change of control or a busi- ness transfer involving a company with a works council, the works council must be consulted and has a right of prior advice. While the works council’s advice is not legally binding on the company’s board, the company must await the works council’s advice before proceeding with the proposed transaction. If the board chooses to disregard the works council’s opinion, it must justify its decision and may face delays, as the works council has the right to escalate the mat- ter to the Dutch Enterprise Court ( Onderneming- skamer ). The Dutch Enterprise Court assesses whether the board’s decision is unreasonable. For (group) entities, where either the buyer or seller has 50 or more employees in the Nether- lands, there is an obligation to notify the Dutch Social Economic Council ( Sociaal-Economische Raad or SER) and any relevant trade unions prior to completion of the proposed transaction. Trade unions may also request consultations regarding the transaction’s social and economic impact on employees. For transactions primarily concerning the Dutch market, where the entity or group entity employs 50 or more individuals in the Netherlands (either on the seller’s or acquirer’s side), there is a requirement to notify, in a timely manner, SER and relevant trade unions (if any) ahead of the
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