Netherlands: The Shareholder Rights And Activism Review

Last Updated: 30 December 2016
Article by Paul Cronheim, Willem Bijveld and Frank Hamming

Most Popular Article in Netherlands, January 2017


Shareholder activism is a hot topic in many Dutch boardrooms. Discussions between boards and shareholders on matters such as strategy, corporate governance and executive compensation have become a regular feature within Dutch listed companies. This chapter gives an overview of the Dutch regulatory and legal framework in which listed companies and their shareholders operate, points out the key trends concerning shareholder activism in the Dutch market, and zooms in on a few topical battles between companies and activist shareholders.


i Primary sources of law, regulation and practice

Dutch Civil Code

Book 2 of the Dutch Civil Code (DCC) is the primary source of law with regard to Dutch corporate law. As such, the DCC also covers the rights and duties of, and the division of powers between, the (one or two-tier) board and the general meeting of shareholders.

Dutch Corporate Governance Code

The Dutch Corporate Governance Code complements the DCC as it lays down principles and best practice provisions that regulate the relationship between the board(s) and the general meeting. The Corporate Governance Code is currently under revision and a new version is expected to come into force in 2017. The Corporate Governance Code applies on a comply-or-explain basis to, briefly stated, all Dutch listed companies.

Dutch Financial Markets Supervision Act and Market Abuse Directive

The Dutch Financial Markets Supervision Act (FMSA) contains, among others, disclosure obligations for listed companies, major shareholders and board members, and rules on takeovers of listed companies. The FMSA has implemented numerous EU directives, such as the Transparency Directive and the Takeover Directive. As per 3 July 2016, several market abuse provisions have been removed from the FMSA and are now dealt with in the Market Abuse Regulation. The MAR has direct effect in all EU Member States.

EU Alternative Investment Fund Managers Directive

For hedge funds and private equity funds specifically, the Alternative Investment Fund Managers Directive (AIFMD) is also relevant as it sets out rules and requirements for the authorisation, ongoing operation and transparency of AIFMs.

ii Division of powers – roles of the executive board, the supervisory board and the general meeting

Most Dutch public limited liability companies with a listing on the Amsterdam Stock Exchange have a two‑tier board, consisting of an executive and a supervisory board.1 In a two-tier board governance model, the roles of the main corporate bodies can be summarised as follows.

The executive board manages the company and is in charge of the company's aims, strategy, risk profile, results and corporate social responsibility issues. The executive board is accountable to the supervisory board and the general meeting of shareholders. The executive board has a fiduciary duty to the company's stakeholders (including, but not limited to, its shareholders).

The supervisory board is charged with supervising and advising the executive board. The supervisory board has certain rights regarding the appointment, suspension and dismissal of executive board members, and the approval of the supervisory board is required for certain important resolutions. The supervisory board is accountable to the general meeting and also has a fiduciary duty to all stakeholders of the company.

The general meeting monitors the performance of the executive board and the supervisory board. The powers of the general meeting are vested in the DCC and the company's articles of association. For example, in principle, a decision of the general meeting is needed for resolutions concerning issuance of shares, dissolution of the company, adoption of the annual accounts, board compensation, and amendment of the company's articles of association. Transactions regarding an important change in the company's identity or character (e.g., sale of the company) require prior approval of the general meeting. The general meeting also has the power to appoint and dismiss board members. The company's articles of association, however, may limit this power by stating that the appointment and dismissal occurs upon a (binding) proposal from the executive or the supervisory board, or can only be taken with an increased majority requirement.

iii The activist shareholder's toolbox

This section provides an overview of common tools that activist shareholders use in pursuing their agenda. See Table 1 for the different levels of aggression of these tools.

Table 1

Private discussions and engagement with the company

In the Netherlands, the vast majority of shareholder activism starts with the activist engaging with the boards of the company in a private setting. This could take the form of informal one-on-one discussions or conference calls with the company's CEO to discuss strategy and measures to maximise shareholder value, or more formal communication by sending private 'Dear Board' letters.

Public engagement with the company

When a shareholder activist is not satisfied with the company's response to issues raised in private discussions, starting a public campaign might be an alternative to realise its agenda. Generally, this includes the use of (social) media, teaming up with other shareholders and institutional investors, and gaining support of the investor community at large.

In the Netherlands there have been few public campaigns by activist shareholders. The most notorious example in this respect is still the 2007 campaign of UK-based hedge fund The Children's Investment Fund against ABN AMRO.


For an activist shareholder to ramp up the pressure on the company's boards, enlarging its stake could be an effective tool. Even with a small stake, an activist shareholder could have significant influence.

When buying shares, the activist shareholder must observe the rules on disclosure of substantial shareholdings. Pursuant to the FMSA, a shareholder must immediately notify the AFM if its percentage of capital interest or voting rights exceeds (or falls below) a number of specific thresholds. Currently, the thresholds are: 3, 5, 10, 15, 20, 25, 30, 40, 50, 60, 75 and 95 per cent.2

An activist shareholder building up its stake should also be aware of the mandatory offer rules. Under the FMSA, a mandatory offer is triggered by a person, or a group of persons acting in concert, acquiring 'predominant control' (at least 30 per cent of voting rights). When a shareholder reaches this threshold it is in principle obliged to make an offer for all remaining shares of the target company.3

Right to participate in and exercise right to vote at general meeting

Every shareholder has the right to participate in and exercise its voting right at the company's general meeting. In principle, the holder of one share is entitled to one vote ('one share - one vote' principle). The articles of association may stipulate a voting record date 28 days prior to a general meeting. The record date therefore determines those shareholders entitled to vote at a general meeting. Shareholders may vote in person or by proxy, which proxy may be granted electronically.

In the Netherlands a 'vote no' campaign has been seen on numerous occasions. Recently, hedge fund Highfields Capital Management opposed the plans of insurer Delta Lloyd to pursue a rights offering. Another example is the 2016 'vote no' campaign of Dutch shareholders' association VEB against the pay package for Shell board members.

Right to place an item on the agenda

Shareholders holding individually or jointly 3 per cent of the company's stock have a right to submit items for the agenda of the general meeting. The company's articles of association can prescribe a lower percentage. The Corporate Governance Code stipulates that a shareholder may exercise this right only after he consulted the executive board. See in this respect also the company's right to invoke a 180-day response time (see below).

A notable example in this respect is the case concerning ASMI, a Dutch multinational active in the semiconductor industry, where hedge funds Fursa and Hermes put a proposal on the agenda of the 2008 general meeting to replace the CEO and most of the supervisory board members. More recently, Dutch civil rights group Follow This put a 'green' resolution on the agenda of the general meeting of oil giant Shell in which it requested the board to invest the profits from fossil fuels into renewable energy.

Shareholders can submit items on the agenda as either a voting item or a discussion item. However, shareholders cannot force the board to put an item on the agenda as a voting item if the general meeting does not have the power to resolve upon the topic; in other words, shareholders cannot use this right to organise referenda or 'motions' on topics belonging to the primacy of the board. See the recent (2016) case of Boskalis against Fugro in paragraph IV.

Right to convene a meeting

Shareholders holding individually or jointly 10 per cent of the company's stock are entitled to call a general meeting and put such items on the agenda as they deem appropriate. The company's articles of association can prescribe a lower percentage. A prominent example of activists exercising this right is Centaurus and Paulson & Co, who called shareholder meetings at Dutch industrial conglomerate Stork to vote on alternative strategies, including a public-to-private transaction, and on the dismissal of the entire executive board.

Initiate litigation

Shareholder litigation typically takes place in inquiry (mismanagement) proceedings before the Enterprise Chamber.4 Any shareholder that alone or acting jointly holds sufficient shares5 may initiate inquiry proceedings and request the Enterprise Chamber to order an inquiry into the policy of the company by independent court-appointed investigators.

The Enterprise Chamber may order an inquiry into the policy of a company if it is demonstrated that there are reasonable grounds to believe that there is mismanagement. This may, for instance, consist of abuse of minority shareholders, insufficient disclosure to shareholders, conflicts of interest of board members, or the unjustified use of takeover defences.

The Enterprise Chamber may at any time during the proceedings order interim measures. The interim measures ordered by the Enterprise Chamber may play an important role in takeover situations and activist campaigns. Interim measures may include suspending executive or supervisory board members, appointing interim executive or supervisory board members and suspending shareholders' voting rights. These interim decisions tend to carry great weight and, despite being provisional, are often decisive in the outcome of the matter.

The Enterprise Chamber has repeatedly demonstrated its willingness to act promptly and take rigorous action in takeover and activist situations. In the context of takeovers of public companies, shareholder interest groups and other activist shareholders often use (the threat of ) inquiry proceedings to protect the interests of minority shareholders against the boards of the target company (the members of which may no longer be independent) or a majority shareholder.

To read this Review in full, please click here.

Originally published by Law Business Research Ltd.


1. Dutch law provides companies with the option to structure their boards based on a one-tier model (single board with both executive and non-executive board members) or a two-tier model (separate executive and supervisory boards). One-tier board structures are often seen with Dutch public limited liability companies with a listing on the NYSE or NASDAQ, for example Mylan NV, NXP Semiconductors NV, and Unilever NV.

2. For non-EU entities with a listing on the Amsterdam Stock Exchange that choose the Netherlands as their EU home Member State, the thresholds are: 5, 10, 15, 20, 25, 30, 50 and 75 per cent.

3. A mandatory offer will not be required if, within 30 days following the acquisition of control, the controlling party reduces its stake below the 30 per cent voting rights threshold, provided that the voting rights held by that controlling party have not been exercised during this period and the shares are not sold to another controlling shareholder of the company. The Enterprise Chamber may extend this period by an additional 60 days.

4. A shareholder can also initiate summary proceedings before the competent Dutch district court. However, summary proceedings are much less common, since the Enterprise Chamber is regarded as the specialised court regarding corporate litigation.

5. If the company's issued share capital does not exceed €22.5 million: persons who alone or acting jointly hold shares representing at least 10 per cent of the issued share capital or representing a nominal value of at least €225,000. If the company's issued share capital exceeds €22.5 million: persons who alone or acting jointly hold shares representing at least 1 per cent of the issued share capital or, if the shares are listed, representing a value of at least €20 million based on the closing price of the last trading day.

The threshold for an activist shareholder to have standing in the Enterprise Chamber can be extremely high as a result of the capital structure of the company. This was the case at Mylan where the nominal value of each share was set at €0.01 and the issued share capital did not exceed €22.5 million. As a result, a shareholder wanting to initiate inquiry proceedings would need to hold shares with a market value of more than US$1 billion to reach the threshold of €225,000 in nominal value.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.