Vol 21 (2024) - Issue 5

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How Is the Dutch WHOA Doing?

Synopsis
It has not gone unnoticed, in the Netherlands the 'WHOA' regulates the restructuring of debts of companies. The Private Composition Plan Confirmation Act (the 'Wet homologatie onderhands akkoord', or: WHOA) entered into force on 1 January 2021. In 2023 it underwent several changes following the implementation of the EU Restructuring and Insolvency Directive 2019/1023. In short, the aim of the WHOA is to prevent companies that are viable in themselves from going bankrupt due to excessive debt or structural debt. This is done as the name suggests by court confirmation ('homologatie'), i.e. approval or ratification by the court of a private agreement between the
debtor and (part of) his creditors and/or shareholders that provides for the change of their rights and that can also bind creditors and shareholders who do not agree. The new legislation was evaluated at the end of 2023. What is the current status of the Dutch WHOA? Are the objectives of the WHOA being achieved in (early) practice? What are the practical experiences of the introduction of the new law? Are changes necessary?