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On October 6, 2020, the Dutch Senate approved long-anticipated restructuring legislation allowing for court confirmation of extrajudicial restructuring plans (
Wet Homologatie Onderhands Akkoord, or "WHOA").
The legislation combines features of the U.S. chapter 11 procedure and the English Scheme of Arrangement. With its broad range of jurisdiction and flexibility, the "Dutch Scheme" should prove to be an effective addition to the restructuring toolbox for both Dutch and non-Dutch entities and for groups of companies, with the possibility of automatic recognition throughout the European Union. The new proceeding can be used to restructure both Dutch companies with a "center of main interest" in the Netherlands as well as non-Dutch companies with a sufficient nexus with the Netherlands (e.g., by means of significant group activities in the country). It is considered a last-resort pre-insolvency restructuring tool with limited court supervision.