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Rules for statutory two-tier entities remain unchanged for now
On 3 February 2005, the Lower House of the Dutch Parliament debated the Modernization of Corporate Law Policy Document. In that Policy document, which was published on 8 September 2004, the Dutch Minister of Justice, Donner, advocated far-reaching changes in the rules for statutory two-tier entities. In his view, the current supervisory role exercised by the non-executive directors is not seen as a modern and internationally accepted business model. He singles out the restricted influence of the shareholders with regard to the composition of the non-executive board and the appointment/removal from office of directors, which should be widened.
According to the Lower House, however, these changes are premature. The first job is to find out what the market thinks of the latest amendment to rules for statutory two-tier entities (October 2004). Only then can thoughts turn to further changes in those rules, according to members of parliament from both sides of the House.
The Modernization of Corporate Law Policy Document also proposes other changes regarding the simplification of the rules on private limited companies, converting shares into depositary receipts and rules on public offers. It is not clear what will become of those proposals. A frequently-heard criticism of Donner’s Policy Document is that it is rather vague.
For any questions on developments in corporate law, please contact Hugo Reumkens or Harm Uittien.
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