At the University of Leiden, the launch of a brand new research center is nearing, the new Center for Business & Liability (CBL). Within CBL, some 15 members of the departments of Corporate Law and of Business Sciences of the Leiden Law School work together, in a innovative and challenging way, i.e. multidisciplinary and comparative research in the area of governance, liability and insolvency. The center is at the hard of a larger trend to also do research into the (non-legal) human, cultural and organisational aspects of business liability. On Thursday, 25th and 26th of January 2018, CBL's International Opening Conference will be held. CBL SavetheDate It is a 2-day meeting where various speakers from the Netherlands and abroad will debate the business resilience theme. CBL Conference Brochure Presently a Call for Research Proposals is distributed. During the opening conference, the organisers of CBL will offer a number of excellent researchers to discuss their submitted Research Proposals. This is a great opportunity for researchers! See CBL Call for research proposals More information about the research center and the conference can be found on our website www.cbl-leiden.com. Personally, I would like to extend my congratulations to the leadership of CBL in gettting there research together and for having started this great initiative. In addition conferees of CERIL will be able to dicuss and give input to one of CERIL's larger projects, see http://www.ceril.eu/projects/project-1/. This all promises to become an enriching event!
Wessels Insolventierecht IX 2017, met de titel 'Schuldsaneringsregeling natuurlijke personen', is Deel IX in de tiendelige serie Wessels Insolventierecht. Dit Deel IX bevat een systematische behandeling van de schuldsaneringsregeling, zoals deze is opgenomen in de Faillissementswet. Centraal staan natuurlijk de artikelen 284-362 uit die wet. De regeling is op 1 december 1998 ingevoerd en is sindsdien ingrijpend gewijzigd, in het bijzonder door de wetswijzigingen die met ingang van 2008 van kracht zijn geworden. In Deel IX wordt in detail aandacht gegeven aan de toe- en afwijzingsgronden van de schuldsaneringsregeling en de gevolgen van haar toepassing, de gedwongen schuldregeling ex art. 287a, de voorlopige voorzieningen in spoedeisende zaken en het moratorium in geval van een bedreigende situatie. Daarnaast passeren de revue: het bestuur van de boedel, de rol van de bewindvoerder, de voorzieningen na de rechterlijke uitspraak, het verloop van de schuldsaneringsregeling, de vereffening van de boedel en de tussentijdse en reguliere beëindiging van de schuldsaneringsregeling. De vrij uitvoerige parlementaire geschiedenis is in de tekst verwerkt, evenals het meest recente Procesreglement verzoekschriftprocedures insolventiezaken rechtbanken van het LOVC, de Recofa-richtlijnen voor schuldsaneringsregelingen en de in 2017 gewijzigde procesreglementen voor verzoekschriftprocedures handels- en insolventiezaken bij de gerechtshoven en het Procesreglement van de Hoge Raad. Verder is een selectie van de vrij omvangrijke rechtspraak verwerkt. Evenals in de andere delen in de serie zijn uitvoerige registers opgenomen (een literatuuroverzicht, rechtspraak- en wetsartikelenregister). De bewerking is begin september 2017 afgesloten. Met de publikatie van dit deel is de gehele serie gedurende de jaren 2013 tot en met 2017 bewerkt. Vraag natuurlijk is of ik ook een vijfde druk van alle delen ga verzorgen, verspreid over de jaren 2018 tot (circa) 2023. Daar ga ik over nadenken. Uitreiking van het eerste exemplaar van het boek aan mr Piet Neijt, rechter-commissaris Rechtbank Midden-Nederland (locaties Almere, Amersfoort, Lelystad en Utrecht), tijdens de door deze rechtbank georganiseerde Europa-dag 2017, met lezingen, workshops en discussies, in Theater Gooiland Hilversum, op 2 november 2017.
In two recent Dutch court cases, the determination of the insolvent debtor’s centre of main interests (COMI) went in two distinct ways. These cases are District Court Amsterdam 12 July 2017, ECLI:NL:RBAMS:2017:5383, and District Court North-Holland 17 October 2017, ECLI:NL: RBNHO:2017:8588. In both cases the court is confronted with the alignment of Dutch (insolvency) procedural law (in the Dutch Bankruptcy Act) and the rules regarding international jurisdiction in the European Insolvency Regulation (Recast), the EIR 2015. To understand these cases, the Dutch Bankruptcy Act provides the following: ‘Article 2. 1. The bankruptcy order is rendered by the District Court within whose district the residence (‘woonplaats’) of the debtor is located. 2. If the debtor has left the Kingdom of the Netherlands in Europe, the District Court within whose district his last residence was located, has jurisdiction.’ In the earlier case Kingsignal (Hong Kong) International Limited (‘Kingsignal’), incorporated in Hong Kong, files a petetion for bankruptcy liquidation (‘faillissement’) of Powerstorm Inc. (‘Powerstorm’), incorporated in Delaware, USA. Kingfisher provides details to be able to conclude that Powerstorm’s COMI is in the Netherlands. Powerstorm, however, denies and claims its COMI is in the USA or, at least not in the Netherlands. Its arguments: its registered office, its board of directors and its shareholder are in or from the USA. The management of the company is driven from the US and is currently working on initiating a so-called Chapter 11 procedure. The office location in Amsterdam is just an office where from time to time someone is present. It serves only for accepting orders for goods to be distributed to Europe, Russia, the Middle East, Africa and Asia. Sometimes invoices are also invoiced from there. Customers, however, are from all over the world. The website has recently been modified and, in error, only the address in Amsterdam was entered as contact address. The Court considers that Article 2(1) of the Dutch Bankruptcy Act provides jurisdiction to the court and that for the interpretation of the Dutch term of ‘residence’ or ‘centre of main interests’ of the debtor, connection should be sought with Article 3(1) EIR 2015. It then cites the relevant texts of the latter provision. The court comes down to a balancing of the facts presented, in short: (i) the annual accounts of Powerstorm of 2015, deposited in the Netherlands, include the sentence: ‘Powerstorm Inc. has its legal seat in Yorklyn, Delaware, USA. In the Netherlands the company has an office at Joop Geesinkweg 999 in Amsterdam …’, (ii) according to the website, the contact address for Powerstorm in Europe is the address in Amsterdam, and in addition the website states that Powerstorm is ‘Based in Amsterdam, with offices in Los Angeles and Bucharest and repair centers around the world ... Our services and operational footprint span from North and South America, to Europe, the Middle East, Asia and Africa.’ Nowhere else on the website, the court concludes, mention is made of any other address, (iii) the invoices to Powerstorm were sent by the applicant to the address in Amsterdam. Never an objection has been made. Also, the letter of the President of Powerstorm, dated 26 June 2017, addressed to the applicant’s CEO provides the Amsterdam address. From these pieces of evidence, the court is satisfied that, in view of all the above-mentioned public expressions, creditors were able to rely on the fact that Powerstorm’s COMI is in the Netherlands. The mere fact that the board and the shareholder are American does not conclude that Powerstorm’s COMI is in the USA. The legal presumption that the registered office is the debtor’s COMI is hereby rejected, so decides the court. In the other case mentioned, the applicant (R.L. Bezuijen Holding B.V.) has applied for the bankruptcy liquidation of X, who has no known place of residence or domicile in the Netherlands. The court considers (based on recitals 8, 26, 27, 28, 30, 33 as well as its duty to ex officio assess whether international jurisdiction exits) that the EIR 2015 is applicable. The applicant claims that the court has jurisdiction pursuant to Article 2(2) of the Dutch Bankruptcy Act. The court, however, on the basis of the foregoing, considers that it does not have the right to assess its jurisdiction on the basis of Article 2(2). From the above mentioned recitals and Article 4(1) EIR 2015 it follows, the court states, that the court must review its jurisdiction pursuant to Article 3 EIR 2015. After citing the text of Article 3(1) the court comes to the facts. These are that the applicant has not disputed that debtor X resides in or near Paris and does no longer live in the Netherlands since the beginning of 2016. The applicant stated that X (whether or not through a company) in (or around) Paris has a number of apartments and that he lives in one of them. In this case, the court concludes that the applicant, as a creditor of the debtor, provides just an estimation that (the vicinity of) Paris is the place where X administers interests. The court further contemplates that the applicant has not provided any facts or circumstances suggesting that the usual residence (Paris) is indeed the COMI of X. The fact that in this case in the Dutch real estate registration (Kadaster) real estate is registered in the name of a company of which X is a manager and / or a shareholder is, the court concludes, in any case insufficient. It is no property of X himself. That X regularly stays in the Netherlands is, according to his attorney, because he maintains family relations (including contact with his daughters) in the Netherlands. Consequently, this fact cannot lead to a rebuttal of the presumption that his habitual residence is his COMI. Where the COMI is not situated in the Netherlands, the court is not entitled to open insolvency proceedings pursuant to Article 3(1) EIR 2015. It therefore declares the applicant inadmissible in its application. The latter case clearly is correct in that the court ex officio assesses its ‘international jurisdiction’. The EIR 2015 only deals with this legal element, see recital 26, which the court refers to. It does not mention recital 32: ‘In all cases, where the circumstances of the matter give rise to doubts about the court’s jurisdiction, the court should require the debtor to submit additional evidence to support its assertions and, where the law applicable to the insolvency proceedings so allows, give the debtor’s creditors the opportunity to present their views on the question of jurisdiction’. Evidently, because the facts presented by the applicant were thin, the court had no doubts. The court in the latter case also refers to recital 30, which provides a rule for the depth of the examination of the facts resulting in COMI: this examination should be done ‘carefully’, in order to confirm that the COMI is ‘genuinely’ located in a member state, see recital 30. It is clear that a court should exercise a serious activity to assemble facts, but on the other hand it allows the court a margin of appreciation. In the first case, the court is confused regarding the relation between national procedural law and the EIR 2015. The latter binds in its entirery and directly, any by-pass through legal terms in national rules is not correct and, for the sake of clarity, should be avoided. The application of COMI is a matter of the EU law (see the Eurofood case of 2006, in which the European Court of Justice (as it then was called) in para. 31 expresses that COMI must be ‘interpreted in a uniform way, independently of national legislation’. National law deals only with deciding on the allocation of cases between local courts, i.e. which particular court will be hearing the case, provided that COMI is found pursuant to the EIR 2015. For applications of Article 2(2) of the Dutch Bankruptcy Act, according to which jurisdiction is decided solely on the basis of national law (and based on the presumption that COMI is not in the Netherlands) see (in Dutch) http://bobwessels.nl/2017/09/2017-09-doc8-rechtsmacht-rechter-in-faillissementszaken/ More on the EIR 2015, see my book International Insolvency Law Part II. European Insolvency Law (Wessels Insolvency Law Volume X), Deventer: Kluwer, 4th ed., 2017, ISBN 9 789013 145021. For information, see http://bobwessels.nl/2017/09/2017-09-doc4-wessels-international-insolvency-law-part-ii-european-insolvency-law/. On the judgment of opening insolvency proceedings, see para. 10521b, and on international jurisdiction regarding natural persons, see para. 10588 et seq. I thank Ilja Kokorin, lecturer at the Leiden Law School, for the discussions we had on the two cases. [31 October 2017; Bob Wessels]
Aan Minister van Justitie en Veiligheid mr Grapperhaus Mijn welgemeende gelukwens met uw benoeming. De komende dik 3 jaar (laten we aannemen) zult u meer dan voldoende te doen hebben en ik wens u, naast veel werk, ook veel succes toe. Als ‘insolvency veteran’ keek ik even naar het regeerakkoord. Daar staat iets over het bestrijden van armoede en schulden, waarin ik mij goed in kan vinden, maar aan de uitwerking zitten natuurlijk nogal wat haken en ogen, zie mijn blog http://bobwessels.nl/2017/10/2017-10-doc5-regeerakkoord-2017-2021-over-aanpak-schulden/. Hoe ten aanzien van in financiële moeilijkheden verkerende bedrijven? Vorige week (als persoon, niet als minister, want terecht maakt u daartussen verschil) schrijft u in Ondernemingsrecht 2017/124 over ‘De prepack-vlinder die rups bleef’. U doet, in persoon, eigen voorstellen om de financiële druk van werknemersrechten bij (dreigende) insolventie te verminderen. U hebt, misschien al dit weekend loodgieterstassen doornemend, gezien dat al een jaar of 5 binnen uw ministerie wordt gewerkt aan het wetgevingsprogramma ‘Herijking Faillissementsrecht’. Dit heeft tot nu toe geleid tot nieuwe wetgeving ter verbetering van de bestrijding van faillissementsfraude en de invoering van een civielrechtelijk bestuursverbod (beide in werking getreden op 1 juli 2016) en de versterking van de positie van de curator (met ingang van 1 juli 2017 van kracht geworden). Een drietal wetsvoorstellen die de continuïteit van rendabele ondernemingen beogen en enkele voorstellen die verband houden met de modernisering van de insolventieprocedure verkeren in diverse stadia van behandeling (voor meelezers, zie negende voortgangsbrief d.d. 28 september 2017, Kamerstukken II 2017/18, 33 695, nr. 15). Als ik het goed heb waren de uitvoerders van dit programma tot nu toe VVD-ministers, en nu dan iemand van CDA-huize. Gaat u dit programma voortzetten? Het regeerakkoord bepaalt hierover, als ik goed zie, niets. Indien u doorgaat (een politieke 'doorstart' :)), heb ik een aanmoediging en een voorstel. Wat te doen bij dreigende insolventie van bedrijven is een ongemeen belangrijk onderwerp. De continuïteitsvoorstellen (en de Europese voorstellen voor introductie van preventieve herstuctureringsstelsels) leiden tot een indringende wijziging van onze sociaal-economische ordening, leidend tot, kortweg, een nieuw evenwicht tussen (rechten/plichten/bevoegdheden van) ondernemingsbestuur, aandeelhouders, werknemers en schuldeisers, en nieuwe regels vooral voor hen die dit evenwicht mede gestalte geven en toetsen: herstructurerings- en insolventie-experts, rechters. Politieke partijprogramma’s besteden aan dit thema al jaren nagenoeg geen aandacht; er worden soms wat woorden gewijd aan de schuldenproblematiek van natuurlijke personen. Dat wil zeggen dat over de aanpak van dreigende insolventie van bedrijven noch het regeerakkoord, noch partijprogramma’s (van de vier coaletiegenoten) hier iets over bepalen! De aanmoediging: u bent creatief en u bent voor het maken van (rechts)politiek niet gebonden aan expliciete politieke beperkingen. Dat zal een mooie uitdaging zijn! Mijn bescheiden voorstel, als u met dat programma doorgaat: wijzig herijking ‘Faillissementsrecht’ in ‘Faillissementswet’, want buiten de wet om wijzigt het recht en de praktijk al naar gelang nieuwe desiderata en inzichten zich aandienen (de opkomst van de Nederlandse pre-pack is daarvan een goed voorbeeld). De overheid heeft wel de wet in de hand, maar herijking van het ‘recht’ is wel erg aanmatigend. Ik ben benieuwd. Ik (‘het land’) hoort binnenkort graag van u.
For around a year now, I am chairman of the Advisory Board of DigiTrage (Digital arbitration in debt collecting cases). The organisation (see www.digitrage.nl) will publish an interview with me. See for its questions and my answers below: Can you say something about your background? I have been a lawyer for over 40 years, and a professor of civil law, commercial law and international insolvency law for over 25 years (fulltime, later part time). This was between 1988 – 2008 at the VU University Amsterdam and from 2007 – 2014 (also one day per week) as professor of international insolvency law at the Leiden University. It is not common knowledge, but I was able to really make a living via my principal activity during the past 25 years: (international) commercial-legal advisor, the first 13 years as partner of global services provider Ernst & Young (now: EY). I have also had management positions there between 1995 and 2003, with 5 years at an international board position. Since 2005 I had my own commercial (international) advice, opinion and arbitration practice, mostly focusing on the area of (international) restructuring and insolvency of banks and companies. I retired in March 2014 (in the world of universities they call this: accorded emeritus status) and during 2016 I have ended my commercial advice practice. I have a number of national and international advisory functions and I am still scientifically active. What study have you done and why? Aha, good question to give some background. In a lot of professional areas you can study your whole life. Because of my pre-education (HBS), not all study areas were available to me. In secondary education – we’re talking about the second half of the 60’s! – I was interested in economy and – as we called it then – commercial knowledge. If you go in this direction you quickly end up with a legal study, at the VU in Amsterdam, also practical because it was close to Haarlem, where I lived in those days. So I am master of laws (1974, VU Amsterdam; Dutch law), and next to my commercial-legal advisory function I also completed a notarial study in 1977. And yes, life-long learning: in the beginning of the 80’s I wrote about a then unknown phenomenon, the foundation as legal entity and fiscal rulings and agreements with the tax authorities. For my promotion to doctor in law in 1988 (subject ‘Natural obligations. Civil and fiscal law observations about obligations unenforceable by law’) I dived deep into the foundations of the meaning and justification of legal commitments. Continuously collecting knowledge and developing myself further, those are examples of what I did to prepare for the transfer for what then was called the new Netherlands Civil Code, the international contracts and structures that you are confronted with within Ernst & Young, the ‘Anglicization’ of the advisory practice, the influence of the millennium-bug in 2000 and the euro in 2002 on running contracts, the legal concepts that were created by privatization, the more recent rule machine of financial law, the constantly changing and developing technology, which does not just change the legal subjects, but also has a structural impact on working in a legal practice or for example my knowledge about the international insolvency law. Twenty years ago you could fit this in a matchbox, now I can easily write 2 books about it, in English, with over 1500 pages. Learning, from developments, from others, that’s something you do every day. What functions do you have at the moment, and what is involved in its work/tasks? Recently I have, together with my German colleague Stephan Madaus, presented a large report on ‘Rescue of Business in Insolvency Law’ for European Law Institute (ELI), with over 100 recommendations for EU member states and the European Commission of the EU, to make the process of saving companies in financial trouble significantly more efficient and effective. Since 2016, I have been chairman of CERIL, Conference of European Restructuring and Insolvency Law, an independent European think tank which strives for the improvement of the laws and practices related to restructuring and insolvency in the EU and its member states. I am advisor with ELI for the project ELI-UNIDROIT (The International Institute for the Unification of Private Law, Rome) ‘European Rules of Civil Procedure’, which focuses on the development of a European model for standardized rules of civil procedures. A few functions have been going on for longer: member of the Joint Board of Appeal of the three European supervisors of the financial markets (EBA, ESMA, EIOPA), advisor of the European Commission concerning restructuring and insolvency law and the chairmanship of the SER/Coordination Consultation Selfregulation, Consultation Group Banks and Notaries. Results of these consultations are, among other things, General service conditions Notaries 2014 and the General bank terms and conditions of 2017. But I think the legal world in Holland mostly knows me as the author of 'Insolventierecht' (Insolvency law), a 10 volumes series that has been published since 1999. This month the last part will be released in its 4th edition. In the near future I will start to prepare to write the fifth edition of this series within five or six years, because there is a lot of interest for it in the legal practice and I like doing it. What was the reason that you joined the Advisory Board of DigiTrage? You are asked to contribute to a new form of dispute resolution. This suited my experience and interests. Between 1988 and 2016 I was deputy justice in the Court of Appeal in The Hague and since 1987 I was an arbitrator, and since 2000 chairman, of the Standing Disputes Committee of Achmea related to life and pension insurances. Aside from that I have handled various arbitrations, as an independent arbitrator not connected to an institution. This knowledge can come in handy when helping to develop a relatively young organization like DigiTrage. The Advisory Board supports DigiTrage in realizing what we see as the core values of dispute resolution. And also how these can be guaranteed in this world of growing importance of electronic information and communication. Of course this influences the usual dispute resolution. Doesn’t it? Of course, stable dispute resolution, the way we know it from the past, is under pressure. In various sectors there are already preventive efforts to avoid disputes (via mediation and on-line dispute resolution), in other sectors, threshold-lowering mechanisms are used (a broad pallet of dispute committees). For international financial disputes, the position of London (because of Brexit) comes under pressure. Singapore and Frankfurt are warming up by the sidelines. I would also think of Amsterdam, but when I look at the slow process of establishing a Netherlands Commercial Court (NCC), this seems too ambitious. For international trade disputes, this NCC will go to work in Amsterdam, I believe from 1 January 2018. Aside from a few judicial obstacles, in some international cases the court registration fees in the first instance (€ 15,000; in interim injunction € 7,500) and in appeals (€ 20,000; in interim injunction € 10,000) can have a prohibitive effect. It can also take a while before this Court functions, because parties will have to adopt a forum choice for the NCC in their agreement. Furthermore, this new arrangement does not apply to cases which fall under the authority of the district judge. So he will remain the have jurisdiction for international agency contracts or the rent of expensive machines or ships. In the Netherlands, a slow but sure switch is being made to ‘mandatory digital procedures’. From 1 September 2017, a lawyer litigates for a big number of cases digitally to the courts of Gelderland and Midden-Nederland in redress cases with mandatory legal representation (with an interest of more than € 25,000). This manner of procedure requires, with clients, lawyers and judges, some getting used to, but it has to lead to procedures becoming simpler, quicker, clearer and more accessible. In a digital file it can always be checked what the current status is. All-in-all, it is a significant challenge for judicial professionals. How do you see the future for digital arbitration in general, and DigiTrage especially? DigiTrage belongs, I think, in the category of innovators and early adopters of digital dispute resolution, via a model supported by arbitration, for the big market of relatively smaller, national disputes. This market seems fairly homogenous: a party desires payment of his claim, as a regular creditor. The past few years, the costs of the legal system have risen significantly. Consequently – however difficult - a corporate decision was taken: no litigation, but write off that claim! Of course strategic behavior of opportunistically acting debtors is looming. A debtor assesses the chance that he (she) will not be the target of its creditors. It is crystal clear that waiving of recovery can lead to liquidation problems. A digital arbitration court, which is faster, cheaper and because of her digital nature has a lower threshold than a national court, can then be a solution. For a lot of transactions, the ordering of goods, booking of concerts or bank transfers, online is the standard, so why not resolve a dispute digitally? Parties, or their digitally versed lawyers, then have to make sure however that contracts or general terms and conditions include a DigiTrage-clause.