NETHERLANDS – The Dutch parliament looks set to ratify European legislation on pension transfer rights in the event of company mergers and acquisitions (M&A) next month, following a favourable decision by the country’s second and most powerful legislative chamber.

Pension rights are currently an exception to Dutch civil law, which states that in case of a merger or takeover, rights and liabilities coming from a current employment contract have to be transferred to the new company.

This summer the Dutch second chamber accepted the thrust of the June 1998 European directive amendment, which stated that member states could not exclude pension rights from M&A activity under national legislation.

The issue has been put to the country’s first chamber for examination, although it can only make referrals back to the second chamber.
Ruud Derksen, a legal consultant with Consultas in the Netherlands, comments: “I know the first chamber has some questions but they are mostly on issues of pension rights and bankruptcy.
“ We expect a decision maybe in September.”

Derksen notes that the Dutch government only has three years to implement the law from the 1998 European amendment – obliging a decision before the year-end.