International Arbitration 2019

Last Updated August 08, 2019

Netherlands

Law and Practice

Authors



Van Doorne is a full-service leading independent Dutch law firm. With around 175 lawyers, Van Doorne has been advising clients for almost 90 years. The firm fields two dedicated arbitration specialists, working out of both its Amsterdam and London offices. These two lead partners rely on a team of some ten associates that are embedded in Van Doorne’s 75-plus lawyer dispute resolution offering. The team is bi-lingual (English-Dutch) and well versed in both civil law and common law concepts and procedure. The focus is on commercial and investment arbitration work, be it under the rules of the NAI or other national/international institutes (LCIA, ICC and UNCITRAL, among many others). The team acts as counsel and co-counsel on arbitration, enforcement and setting aside mandates.

International arbitration is a frequently used and broadly accepted method of dispute resolution in the Netherlands for both commercial and sector-specific (eg, construction) disputes. From a Dutch perspective, the principal advantages of arbitration are considered to be flexibility of procedure, dedication of time and expertise by tribunals, the ease of working with foreign laws, choice of language as well as enforceability of awards (at present, the latter is an advantage, particularly outside the EU).

The Dutch Arbitration Act is modern. The 2015 Act came into force on 1 January 2015, on the back of considerable support from the Dutch legislator for arbitration. This statute applies to arbitral proceedings that commenced on or after 1 January 2015 and court proceedings relating thereto. The 2015 Act updates the Dutch Arbitration Act of 1986 (the 1986 Act). Below, reference is made to the Dutch Arbitration Act and the 2015 Act.

As of 1 January 2019, the newly established Netherlands Commercial Court (NCC) offers English language proceedings in setting aside, recognition and enforcement and other matters ancillary to arbitration. It is also notable that a new arbitration hearing centre has opened in The Hague. This centre complements the existing offering at the PCA and in other venues and is within a 30-minute reach from Schiphol International Airport. It has seen a soft-opening early 2019 and will formally open in October 2019. These developments further strengthen an already solid infrastructure available to both Dutch and foreign-seated arbitrations.

In terms of decided cases, the Dutch Courts continue their pro-arbitration stance.

The Netherlands frequently hosts investment arbitrations (often seated in The Hague and administered by the Permanent Court of Arbitration at the Peace Palace – see www.pca-cpa.org). In recent times, the PRIME Finance Institute has been added to the international institutions based in the Netherlands, providing for dispute resolution in, among others, disputes involving standard form contracts published by the International Swaps and Derivatives Association. These offerings benefit from the strong Dutch arbitration infrastructure and the prominence of the city of The Hague, the International Centre of Peace and Justice which also hosts the ICJ, the Iran-US Claims Tribunal and various other international tribunals. Also, The Netherlands benefits from a strong network of international investment treaties.

In addition, arbitration remains prevalent in commercial (post-M&A, agency/franchising/distribution, corporate) settings, as well as in oil and gas disputes. This follows, in part, from corporate structuring through Dutch holding companies for fiscal reasons. Seating an arbitration in The Netherlands is beneficial for reasons of swift and effective enforcement. As discussed below, Dutch courts also support enforcement of foreign arbitral awards.

The Netherlands Arbitration Institute (NAI) is the premier Dutch commercial arbitration institute. It operates in and out of a market that accepts arbitration as a preferred method of resolving commercial disputes. In addition, the Netherlands hosts many arbitration bodies, including the Permanent Court of Arbitration (PCA) at the Peace Palace in The Hague, the Panel of Recognised International Market Experts in Finance (PRIME) Dispute Resolution Centre and a range of industry-specific arbitration institutes, such as the Arbitration Board for the Construction Industry (Raad van Arbitrage voor de Bouw), the Transport and Maritime Arbitration Rotterdam–Amsterdam foundation (TAMARA) – recently relaunched as UNUM Arbitration & Mediation – and the Arbitration Board for the Metal Trade and Industry (Stichting Raad voor Arbitrage voor Metaalnijverheid en–handel). In terms of volume of international matters, the NAI is the premier institute; in terms of case load in general, the Arbitration Board for the Construction Industry is the most-used institute.

The Dutch Arbitration Act governs arbitrations seated in the Netherlands. This statutory instrument is set out, largely, in Book 4 of the Dutch Code of Civil Procedure. This arbitration act does not distinguish between national (domestic) and international arbitration, but does contain some provisions, primarily dealing with enforcement, specific to cases seated outside the Netherlands. The 1986 and the 2015 Act are, to significant degree, based on the UNCITRAL Model Law. Deviations are limited. The 2015 Act provides more specific arrangements for arbitral interim relief, and in the context of setting aside allows the Court of Appeals to remit proceedings to the tribunal on its own motion.

In this context, it is notable that the UNCITRAL Model Law does apply in the Dutch Caribbean. Hence, the Dutch Supreme Court also expresses views on this instrument, if cassation appeals are initiated in such overseas cases.

No changes have either been recently made or proposed that may change the Dutch arbitration landscape in a significant way.

However, and as was referred to above, the establishment of the Netherlands Commercial Court (NCC) on 1 January 2019 opens the door to full English language proceedings pertaining to setting aside, recognition and enforcement and other proceedings ancillary to arbitration. The NCC operates as a court of first instance and as a court of appeals; the latter is known as the Netherlands Commercial Court of Appeals (NCCA). The parties can opt in to the NCC(A)'s jurisdiction by means of a forum selection clause.

Assuming this is decided by reference to Dutch arbitration law, the general conditions for the valid formation of an agreement apply to agreements to arbitrate. If an arbitration agreement is part of general terms and conditions, the regime applicable thereto applies.

Case law on the European Convention on Human Rights entails that the arbitration agreement should express an unambiguous and unequivocal choice for arbitration. Although, under Dutch arbitration law, arbitration may be agreed upon verbally, this does not have significant practical effect because arbitration agreements can only be validly proven through written instruments.

The 2015 Act is favourable to arbitration and permits arbitration of all disputes on subject matters that the parties may freely dispose of. In practice, this entails that all disputes pertaining to commercial relationships are arbitrable under Dutch law.

Disputes that are not arbitrable include certain aspects of family law, intellectual property law, bankruptcy law and matters that have an erga omnes effect (ie, a binding effect on parties not privy to the arbitration). The involvement of rights of such third parties and the seriousness of the consequences for third parties indicate potential non-arbitrability of a dispute. The most notable example of the latter follows from a case decided by the Dutch Supreme Court and concerns the non-arbitrability of disputes concerning the validity of corporate decision-making. The legislator has not changed this in the 2015 Act.

Traditionally, the courts look favourably upon arbitration agreements and the enforcement thereof. This approach is reinforced in an express provision on international private law in the new Dutch Arbitration Act. It is now provided that an arbitration agreement is valid if it is valid under the most favourable of three regimes, namely: (i) the law agreed by the parties to apply to the agreement to arbitrate, (ii) the law of the seat of the arbitration, or (iii), if no choice has been made for the law applicable to the agreement to arbitrate, the law that applies to the legal relationship that is covered by the agreement to arbitrate.

Arbitration agreements that concern consumers are subject to particular (ex officio) scrutiny by the courts, pursuant to EU case law and regulations.

Arbitration agreements may not be enforced if they are not unequivocal in the election of arbitration or have not been entered into voluntarily. In highly exceptional circumstances, an arbitration agreement may be held to be incompatible with the principles of reasonableness and fairness. If the parties have agreed to summary arbitral proceedings, state courts addressed in contravention of such agreement will decline to accept jurisdiction, except for highly urgent matters where the request relief cannot or cannot timely be granted by an arbitral tribunal.

The 2015 Act explicitly provides that the doctrine of separability applies. Consequently, under Dutch law, the arbitration clause qualifies as an agreement separate from the agreement in which it is contained.

Arbitrators are selected in accordance with the method of appointment provided for in the parties' arbitration agreement including the rules of arbitration agreed to be applicable by the parties. If the parties have not agreed upon a method of appointment, the default rule is that the parties jointly appoint the members of the arbitral tribunal. This default option applies for a limited period of three months under the 2015 Act. At the expiry thereof, the parties may, together or separately, request the President of the District Court to appoint the members of the tribunal.

Where an arbitration is administered by an arbitration institute, the applicable arbitration rules generally provide for the method for selection of the arbitral tribunal. The 2015 NAI Rules depart from their previous default position of a list-procedure and now use party appointment as the default position.

The default position under the 2015 Act is that arbitrators are appointed within three months, counting from the submission of a request for arbitration. If the parties fail to timely appoint arbitrators, the interim relief judge of the competent district court may appoint the missing arbitrator(s), at the request of an interested party.

In the absence of an arrangement in the applicable arbitration rules, the Dutch courts may be requested to assist in in the appointment of arbitrators. Where the parties have agreed – for instance as per the choice for an arbitration institute to administer the case – to have selection (and challenge) of arbitrators be dealt with by such institute, the courts lack jurisdiction. This is congruent to the more general rule that where relief may be obtained in arbitration, the Dutch courts refer the parties to arbitration.

Under the 2015 Act, challenges may be decided by an independent third party (such as the ICC Court or a newly appointed committee at the NAI), other than the competent state court. This is a change from the regime applicable under the 1986 Act, under which challenges to arbitrators were to be brought before the competent court at the seat of arbitration. The latter continues to apply as the default rule and thus, generally, in ad hoc proceedings.

There are no limitations on the nature and qualifications of a person who may serve as arbitrator, but for legal capacity and being a natural person. The requirements of independence and impartiality do, however, act as limitations. The delineation of such norms is influenced by guidelines applicable to state court judges insofar as purely domestic arbitrations are concerned. In an international setting the IBA Guidelines on Conflicts of Interest in International Arbitration are frequently invoked.

No ethical duties specific to arbitrators apply. Ethical duties may, however, apply pursuant to professional rules applicable to arbitrators that are, for example, advocates or medical professionals. In so far as advocates are concerned, a specific provision applies to support independence and impartiality of advocates acting as arbitrators (Article 23 of the 2018 Code of Conduct).

The Arbitration Rules of the NAI contain some rules on the nationality of arbitrators in international arbitrations. The NAI Rules provide for the appointment of a national of a third state as sole arbitrator or chairman of an arbitral tribunal, if either of the parties to an international arbitration (with parties originating from different states) so requests.

Types of disputes that may not be arbitrated include those regarded as forming part of public policy, such as certain aspects of family law, intellectual property law, bankruptcy law and matters that have an erga omnes effect (ie, a binding effect on parties not privy to the arbitration). The involvement of rights of such third parties and the seriousness of the consequences for third parties indicate potential non-arbitrability of a dispute.

In the context of the adoption of the 2015 Act, the arbitrability of disputes pertaining to the validity of corporate decision making was debated in view of a decision by the Dutch Supreme Court in which this court had rejected arbitrability thereof. The outcome of this debate is that such disputes remain non-arbitrable as a matter of Dutch arbitration law.

Dutch arbitration law applies the principle of competence-competence. The (subsequent) control over the tribunal’s decision on jurisdiction is exercised in annulment (ie, setting aside) proceedings. In such proceedings the court may decide on the existence of a valid arbitration agreement, de novo. If a valid arbitration agreement is found to be absent, the arbitral award is annulled and the competence of the competent regular court is (re)instated. This is made clear, explicitly, in the 2015 Act.

If a party in court proceedings invokes an arbitration agreement, the court will (subject to a decision that the agreement to arbitrate is not invalid if validity is contested) find that it does not have jurisdiction to decide upon the dispute. The court will deal with this situation in a separate decision on jurisdiction. Dutch arbitration law requires that an arbitration agreement be invoked in the first written pleadings or, in the absence of written pleadings, the first oral argument. Invoking the arbitration agreement as an objection to the court's jurisdiction at any later stage will lead to a dismissal of the objection and may thus be considered a waiver.

Also in the context of interim relief proceedings and requests for court assistance in the taking of evidence, a party may invoke the existence of an arbitration agreement. If the interim relief court prima facie finds that an arbitration agreement exists, it will refer the parties to arbitration, unless the requested relief cannot be obtained timely in arbitration (see also 3.3 National Courts' Approach, above).

Parties must, in principle, await an arbitral award in order to challenge the tribunal's jurisdiction in court proceedings.

Time limitations apply. Limitation periods commence on various moments and may, due to differing moments of commencement, result in potential renewal of an option to challenge. The limitation periods expire three months after (i) dispatch (verzending) of the award, (ii) deposit of an award with the competent district court (in cases where the parties have agreed to such deposit), or (iii) service of process of an award with an exequatur affixed thereto on the party against whom enforcement is sought. It is important to bear in mind that the 1986 Act, including its regime regarding limitation periods which is slightly different than the 2015 regime described above, remains in force with respect to arbitration proceedings that commenced prior to 1 January 2015.

Under the 2015 Act, challenge proceedings are brought directly to the court of appeals. Decisions by the court of appeals may be subject to limited (cassation) review by the Dutch Supreme Court (for which leave is not required).

Challenge proceedings do not stay enforcement proceedings. Parties may, however, request a stay of enforcement pending challenge proceedings.       

The standard of judicial review for questions of admissibility and jurisdiction is, by and large, de novo. This entails, in particular, that the Dutch Courts will not apply restraint in their review. Such absence of restraint applies to review regarding the validity of an agreement to arbitrate and due process matters pertaining to providing parties with an equal opportunity to be heard.

If a party in court proceedings invokes an arbitration agreement, the court will (subject to a decision that the agreement to arbitrate is not invalid if validity is contested) find that it does not have jurisdiction to decide upon the dispute. The court will deal with this situation in a separate decision on jurisdiction.

Dutch arbitration law requires that an arbitration agreement be invoked in the first written pleadings or, in the absence of written pleadings, the first oral argument. Invoking the arbitration agreement as an objection to the court's jurisdiction at any later stage will lead to a dismissal of the objection and may thus be considered a waiver. The Dutch courts and legislator (the latter per parliamentary papers) do, however, look favourably upon arbitration.

In principle, third parties (ie, those who have not entered into an agreement) are not bound. There are a range of nuanced exceptions to this general rule. These may arise from Dutch Civil Code provisions on obligations and corporate law. Such exceptions include matters involving the transferee of a claim to which an arbitration agreement applies. Other exceptions include co-debtors, certain types of agency, surety and bankruptcy administrators as well as group of companies doctrines.

The Arbitration Board for the Construction Industry (Raad van Arbitrage voor de Bouw) applies a liberal approach to the binding of non-signatories, pursuant to which it relatively easily considers third parties such as sub-contractors to be bound to arbitration agreements. This is particular to this sector.

Tribunals may order interim measures and preliminary relief. The power to award interim measures is explicitly provided in the 2015 Act. It is also frequently provided, in further detail, in arbitration rules. No limitations exist regarding the form of a tribunal’s decision on interim measures, which may be given in the form of both an order and/or an award and may encompass various types of relief. Interim measures are enforceable through obtaining an exequatur (at least in Dutch courts), certainly if they are cast in the form of an (interim) award. This follows from a particular provision in the Dutch Arbitration Act (Article 1043b).

An award containing interim measures may, if agreed by the parties, be issued in pending arbitral proceedings and in separate so-called arbitral summary proceedings (arbitraal kort geding). The NAI Rules contain an opt-out arrangement that provides for such summary arbitral proceedings in Dutch-seated arbitrations. These summary proceedings can result in interim measures that do not formally prejudice the merits yet may be far-reaching and may go significantly beyond preserving a certain status quo. The NAI publishes statistics of, and information on, the use of this procedure. The scope for these summary proceedings is, generally, much broader than those typically available in other jurisdictions; such proceedings can result in, for example, an award providing for: specific performance, de facto freezing of assets, or blocking of a share transfer. Finally, the enforceability of an award in arbitral summary proceedings is not conditional upon the commencement of proceedings on the merits, and no requirement to commence proceedings on the merits exists.

Tribunals, however, are not empowered to grant or lift prejudgment attachments or prejudgment seizures, which could conceivably be an interim measure sought. This is the prerogative of the state courts. Tribunals dealing with summary arbitral proceedings are also empowered, and often impose, (conditional) penal sums to ensure compliance with their awards.

Courts may grant provisional relief in support of arbitrations in case of urgency (ie, per the 2015 Act, if the requested measure cannot be obtained or cannot be obtained fast enough in arbitral proceedings) and, typically, in matters outside the remit of tribunals (such as seizures). Courts may intervene and grant such relief even after the constitution of an arbitral tribunal, if the requested relief cannot be obtained at all in arbitration or cannot be obtained fast enough.

The Dutch Arbitration Act permits the use of emergency arbitrators. Decisions by emergency arbitrators may be binding and have, in some instances, even been granted an exequatur. The permitted types of relief, both for tribunals and for courts, are as set out above in 5.1 Matters Excluded from Arbitration.

Dutch civil procedure provides for security for costs orders against non-EU and non-US parties. This arrangement has limited application in arbitral proceedings, but there is no statutory provision that either prohibits or regulates security for costs in arbitration. It is thus up to tribunals, with due regard to applicable arbitration rules.

The Dutch Arbitration Act governs arbitrations seated in the Netherlands. This Act is largely contained in Book 4 of the Dutch Code of Civil Procedure. The law is monistic and thus does not distinguish between national (domestic) and international arbitration. However, it does contain some provisions (primarily dealing with enforcement) specific to proceedings seated outside the Netherlands.

First, in Dutch-seated proceedings, the following particular procedural steps are mandatory. Parties are required to articulate and adequately substantiate their respective claims and responses. If they fail to do so, a tribunal is, in the absence of reasons for such failure, mandated to discontinue the proceedings (in so far as claims are concerned) or to decide upon the claims made in an award (in so far as failures pertain to the responses).

Second, a party that has appeared in the proceedings shall make objection to the arbitral tribunal without unreasonable delay, as soon as it knows or reasonably should know of any act contrary to, or failure to act in accordance with, any provisions in articles 1036 to 1048(a) of the Arbitration Act, the arbitration agreement, or any order, decision or measure of the arbitral tribunal. If a party fails to do so, then the right to rely on this later in the arbitral proceedings or before the court shall be forfeited.

The arbitrators' mandate, which includes powers and duties, is prescribed by mandatory and non-mandatory provisions of law, the parties and by arbitrators themselves (to the extent they are authorised to do so). The key provisions in this respect are articles 1020 and 1036 of the Arbitration Act.

Such powers and duties concern, in particular, the following: the duty to treat the parties equally, to give the parties the opportunity mutually to set out and explain their positions and to comment on each other’s positions and on all documents and other information brought to the attention of the arbitral tribunal during the proceedings. The arbitral tribunal is also obliged not to base its decision, where it is unfavourable for one party, upon documents and other information on which that party was not sufficiently able to comment. The arbitral tribunal shall guard against unreasonable delay of the proceedings and, if necessary, at the request of a party or of its own motion, take measures in that regard.

Furthermore, absent agreement by the parties, the tribunal determines the place of arbitration and may resolve that hearings, consultations between tribunal members and witness and expert hearings may take place outside the place of arbitration and outside of the Netherlands. The tribunal may resolve to have one of its members conduct such hearing, again absent party agreement to the contrary. In addition, the arbitrators shall afford an opportunity for an oral hearing, upon request by one of the parties or on their own motion, absent party agreement to the contrary. The same applies to matters pertaining to the taking, required submission and assessment of evidence, including appointment of experts, site visits, requests under the 1968 London Agreement and ordering parties to appear.

Finally, it is for arbitrators to decide when an award will be issued.

Parties may appear in person or be represented by a legal representative or other person. Dutch arbitration law does not prescribe particular qualifications for legal representatives that appear in Dutch-seated arbitrations, be it in domestic or international matters. So, legal representatives may indeed appear in Dutch-seated arbitral proceedings if they have qualifications other than Dutch domestic ones.

In state courts prescribed forms and limitations apply.

With respect to documents, requests must be for particular documents. In addition, requests may pertain to carefully prescribed categories of documents. With respect to document production, a request must serve a basic legal interest. Legal privilege and compelling arguments pertaining to confidentiality, such as trade secrets, may also apply and prevent document production requests from being granted.

Disclosure requests are generally also tested through application of relevance and proportionality criteria. Classic fishing expeditions are not permitted.

With respect to witness evidence, the Dutch courts are in principle expected to grant requests to hear witnesses prior to proceedings on the merits. However, such preliminary witness examinations (as they are known) and witness examinations in proceedings on the merits need to tie into matters that could be decisive for the case at hand and specific legal and factual arguments and available evidence put to courts. These criteria may and do serve to enable courts to avoid witness examinations.

Tribunals are not bound by rules on the taking of evidence provided for in the Dutch Code of Civil Procedure. However, in domestic cases, tribunals tend to be inclined to apply such rules by analogy. In international matters, the IBA Rules on the Taking of Evidence are often applied (be it directly or as guidance).

Although the arbitral tribunal are permitted to order parties to produce documents, tribunals cannot, ultimately, compel parties to do so. If a party refuses to produce documents the arbitral tribunal may draw adverse inferences – which generally serves to persuade parties to comply with orders issued.

Witness and expert evidence is generally presented in the form agreed upon by the parties or provided for by a tribunal. Cross-examination is permitted and occurs in international arbitrations seated in the Netherlands, albeit that tribunals typically also question a witness subsequent to counsel. Dutch court practice provides for a prominent role for an examining judge in the examination of witnesses, which influences the course of proceedings in domestic arbitrations.

Absent party agreement to the contrary, tribunals may call witnesses and appoint experts on their own motion.

Courts may grant assistance and relief, including with respect to hearing witnesses. Judicial assistance may also include seizure of information (eg, contained in documents). Taking such measures does not require consent from the tribunal and is a power derived from the Dutch Arbitration Act. If an arbitration agreement is invoked, however, the courts will only exercise this jurisdiction if the measure requested cannot be obtained in arbitral proceedings or cannot be obtained fast enough in arbitral proceedings (as per the 2015 Act). The 1986 Act was somewhat more liberal on this point in the sense that it allowed the court more leeway to offer such assistance. Under the 2015 Arbitration Act, Dutch courts seem reluctant to conclude that the measure requested cannot be obtained, or cannot be obtained fast enough, in arbitral proceedings.

Courts are also permitted to compel witnesses to appear in court and be examined by an examining judge if they fail to appear in arbitral proceedings. The arbitral tribunal may, at the request of any of the parties or of its own motion, order the inspection of, a copy of or an extract from specific documents related to the dispute from the party which has these documents at its disposal, unless the parties have agreed otherwise. This power does not extend to non-parties. However, under general Dutch procedural law on the production of documents, a party in the arbitration can request court assistance in obtaining specific documents from a third party that is not a party in the arbitration.

Arbitral proceedings are generally considered to be confidential, although this is not expressly provided for in the 1986 and 2015 Acts. Arbitration rules do tend to explicitly provide for confidentiality. Of course, parties and tribunals may specifically provide for confidentiality agreements.

As a default, a lower degree of confidentiality applies in cases of a public law nature including investor-state arbitrations, which mirrors international developments in this field of arbitration. Arbitration-related proceedings that may take place in the state courts are not confidential, yet documents filed with the courts are not, generally, publicly accessible. In highly exceptional cases, state courts may determine that their proceedings are confidential.

Awards must be in writing, be signed by a majority of all tribunal members and include: the name and place of residence of each of the members of the tribunal and parties; the date of the issuance of the award; the place of issuance of the award; and the grounds for the decision taken. Under the 2015 Act, the parties may decide, after commencement of arbitral proceedings, to relieve the tribunal from its obligation to provide grounds for its decisions.

If a minority of the tribunal members declines or is unable to sign the award, the majority must make mention thereof.

Tribunals may award punitive or exemplary damages subject to party agreement and the boundaries set by their mandate. Awards of punitive or exemplary damages are uncommon, however. Tribunals dealing with summary arbitral proceedings (see above) frequently grant requests for a conditional penal sum (dwangsom) to ensure compliance with their award. In addition, interest, including compound interest, can be awarded if requested by a party.

There are some further minor limitations on permissible relief, including that a tribunal is not empowered to grant permission to seize property or to lift seizures (see also 6.1 Types of Relief, above).

In principle, the allocation of costs depends on agreement by the parties and the parties’ requests for costs. The Dutch Arbitration Act does not contain a specific rule on this point. Typically, and in the absence of a specific agreement by the parties, the unsuccessful party bears a substantial proportion of the costs, assuming costs are claimed. Dutch court practice, which provides for costs awards on the basis of fixed nominal sums, influences arbitral practice in the sense that some restraint is exercised in awarding full costs. Such restraint is also observed in awards under NAI Rules of Arbitration and propagated by the NAI.

Direct costs (counsel, experts, arbitration costs) are typically awarded, subject to policy concerns at some institutions regarding the costs of experts. Management fees and costs of in-house counsel are typically not part of a cost award but there is no rule preventing that per se.

Awards may only be appealed if the parties have agreed thereto. In case of an arbitral appeal, there is typically only one instance and no formal limitation on grounds that may be invoked. The 2015 Act provides for a default procedure that applies to arbitral appeal proceedings and for the status of arbitral awards against which arbitral appeals (may be or are) issued.

Parties may regulate their rights to arbitral appeal as they see fit.

However, parties may not waive their right to commence challenge proceedings before the court of appeal as the provision governing challenges is mandatory. Parties may waive the right to Supreme Court review of any court of appeal decision on a challenge application.

Awards rendered in arbitrations seated in the Netherlands may be challenged in the Dutch state courts – parties cannot exclude such right to challenge. The grounds for challenge are limited and set out in the Dutch Arbitration Act. Awards may be challenged for:

  • lack of a valid arbitration agreement;
  • constitution of a tribunal in violation of the rules applicable thereto;
  • gross breaches of mandate;
  • lack of signature and/or reasoning; and/or
  • if the award or the manner in which it was made violates public policy.

Challenge proceedings do not amount to révision au fond. Only an award that lacks any substantiation may be set aside for being unmeritorious. Challenges based on the absence of an agreement to arbitrate and challenges concerning an alleged violation of the right to an equal hearing are, however, assessed on a de novo basis.

The New York Convention and Washington Convention have been adopted, as have most of the treaties under the Hague Private International Law Conference.

Dutch courts are generally inclined to grant leave to enforce.

Permission to enforce and award (an exequatur) an award in a Netherlands-seated arbitration must be granted by the president of the district court (voorzieningenrechter) in whose jurisdictional area the place of arbitration is located. An exequatur will be affixed to the original arbitral award or a certified copy thereof. The process is relatively simple and may occur ex parte – that is, without a hearing of the party against whom enforcement is sought (subject to unregulated and proactive applications to a court by the party against whom enforcement may be sought). If recognition and enforcement relates to a foreign arbitral award, the party against whom enforcement is sought will, in principle, be called to appear for a hearing upon the request to recognise and enforce the award. Moreover, under the 2015 Act, the application is to be made with the court of appeal in the judicial district where enforcement is sought. The applicant does not need to demonstrate that the award debtor has assets in the Netherlands that may serve as recourse.

If an exequatur is obtained in the Dutch courts, a bailiff may be engaged to enforce the award in the Netherlands. Recourse to the court is possible for assistance but is not required at this stage. The party against whom enforcement is sought may bring summary proceedings to stay enforcement.

Enforcement of a foreign award may be effected in a matter of weeks; enforcement of a domestic award may be effected in a matter of days. Enforcement may take longer if substantially contested. As a main rule and subject to limited exceptions, an arbitral award can no longer be enforced upon expiry of a 20-year limitation period commencing the day after issuance of the award.

Dutch courts have also (in specific circumstances) permitted enforcement of an award set aside at the place of arbitration. However, the enforcement of an award that has been set aside in the seat is exceptional.

States enjoy sovereign immunity for sovereign acts. Nuanced case law applies to sovereign immunity and this issue is frequently litigated in the Dutch courts.

Recognition and enforcement of a foreign award may be refused on the grounds set out in the New York Convention. Alternatively, in cases where the New York Convention does not apply or where the applicant does not wish to avail itself of the Convention, an application may be based solely on the 2015 Act, in which case recognition and enforcement may be refused if: a valid arbitration agreement lacks (under the applicable law); the tribunal is constituted in violation of rules applicable thereto; if the tribunal has grossly failed to comply with its mandate; if the award is still open to appeal (ie, not final); if the award has been set aside by a competent authority in the country in which the award was rendered; or if recognition or enforcement violates public policy. The Netherlands have issued the reciprocity reservation under the New York Convention.

The initiation of setting aside proceedings, and other forms of opposition, does not, in principle, stay enforcement.

The Dutch jurisdiction is not familiar with class-action arbitration or group arbitration. The Netherlands is, however, a prime venue for (cross-border) collective settlements. Collective settlements may be declared binding by the Amsterdam Court of Appeal under the Act on the Collective Settlement of Mass Damages, known in the Netherlands as the WCAM (Wet Collectieve Afhandeling Massaschade). Settlements often include an arbitration or binding advice (bindend advies) mechanism to resolve disputes as to whether an individual claimant may benefit from the settlement (and to what extent).

Apart from this mechanism for the binding declaration of collective settlements, Dutch law provides for the possibility for a foundation or association that, pursuant to its articles of association, represents the interests of a group of claimants to file a claim against a purported wrongdoer. It has been submitted in literature that these claims may also be brought in arbitration proceedings.

There are no limitations on the nature and qualifications of a person who may serve as arbitrator, but for legal capacity and being a natural person. The requirements of independence and impartiality do, however, act as limitations. The delineation of such norms is influenced by guidelines applicable to state court judges insofar as purely domestic arbitrations are concerned. In an international setting the IBA Guidelines on Conflicts of Interest in International Arbitration are frequently invoked.

No ethical duties specific to arbitrators apply. Ethical duties may, however, apply pursuant to professional rules applicable to arbitrators that are, for example, also advocates or medical professionals.

The Arbitration Rules of the NAI contain some rules on the nationality of arbitrators in international arbitrations. The NAI Rules provide for the appointment of a national of a third state as sole arbitrator or chairman of an arbitral tribunal, if either of the parties to an international arbitration (with parties originating from different states) so requests.

Third-party litigation funding is permitted in the Netherlands. In fact, in the context of the systems for collective redress discussed in 10 The Award, above, litigation or settlement through funded special claims vehicles is common. Third-party litigation funding is less common where it concerns individual claims.

Courts assess the fairness of third-party funding arrangements in the context of class settlements. There is no such review in the context of arbitration.

Arbitral proceedings seated in the Netherlands may be consolidated with other Netherlands or non-Netherlands seated arbitral proceedings. This may be done at the request of a party and if the parties have not agreed otherwise. Consolidation requests may be granted by a third party (if so agreed by the parties) or, if not so determined by the parties, by the interim relief judge in the District Court of Amsterdam. The latter may only consolidate Netherlands-seated arbitral proceedings.

Consolidation may occur if this does not cause unreasonable delay in the pending proceedings, also taking into account the stage of the proceedings and the connection between the two proceedings – ie, the two arbitration proceedings should be so closely connected that good administration of justice renders it expedient to hear and determine them together to avoid the risk of irreconcilable decisions resulting from separate proceedings.

In principle, third parties (ie, those who have not entered into an arbitration agreement) are not bound to an arbitration agreement. There are a range of nuanced exceptions that may arise from Dutch Civil Code provisions on obligations and Dutch corporate law. Such exceptions include matters involving the transferee of a claim to which an arbitration agreement applies. Other exceptions include co-debtors, certain types of agency, surety and bankruptcy administrators and, in some instances, group of companies doctrines.

The Arbitration Board for the Construction Industry (Raad van Arbitrage voor de Bouw) applies a liberal approach to the binding of non-signatories, pursuant to which it relatively easily considers third parties such as sub-contractors to be bound to arbitration agreements. This practice is, however, specific to this sector.

Van Doorne N.V.

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Law and Practice

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Van Doorne is a full-service leading independent Dutch law firm. With around 175 lawyers, Van Doorne has been advising clients for almost 90 years. The firm fields two dedicated arbitration specialists, working out of both its Amsterdam and London offices. These two lead partners rely on a team of some ten associates that are embedded in Van Doorne’s 75-plus lawyer dispute resolution offering. The team is bi-lingual (English-Dutch) and well versed in both civil law and common law concepts and procedure. The focus is on commercial and investment arbitration work, be it under the rules of the NAI or other national/international institutes (LCIA, ICC and UNCITRAL, among many others). The team acts as counsel and co-counsel on arbitration, enforcement and setting aside mandates.

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