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The Authority for Consumers & Markets (“ACM“) recently announced its 2025 agenda (link). This agenda outlines the regulator’s priorities and focus areas for the coming years. Among other things, the ACM wishes to get ready for the challenges of our time and has defined three focus areas in that context. There are also plans to conduct market surveys in certain sectors. In the blog below, you can read what the ACM plans to do in the coming year, and what this could mean for you. Focus points voor 2025 This year, the ACM will focus on three key societal themes. In this way, the ACM wishes to ensure the healthy functioning of the markets concerned, and protect consumers’ interests in these rapidly developing themes. This year’s focus is on: Promoting an open and fair digital economy; Accelerating the energy transition; and Developing a more sustainable economy. The focus points for 2025 are a continuation of the focus work for 2024 (link). The focus from 2024 will be further pursued by more specific and targeted actions in 2025, with a stronger emphasis on digital innovation, energy flexibility and supply chain sustainability. Digital economy The Dutch economy is becoming increasingly digitised. This brings opportunities for economic growth and innovation on the one hand, but also risks on the other. The ACM will therefore pay attention to protecting consumers, especially vulnerable groups such as minors, while promoting economic growth and innovation. Areas of focus include: More oversight of big tech companies to prevent abuse of power; Taking action against abuse, deception and manipulation in online sales and gaming; and Strengthening data protection and consumer privacy rights. Energy transition The ACM is also committed to a rapid energy transition. The ACM aims for a reliable and sustainable energy supply for all people and businesses, now and in the future. In that context, the ACM plans, among other things, to reduce grid congestion and improve flexible grid use in the coming year. In addition, the ACM will promote renewable energy sources and design new regulatory methods for grid operators for future-proof infrastructure. Sustainable economy The ACM supports the development of a sustainable economy. The focus is on ensuring a level playing field between companies and providing clarity for companies when cooperating for sustainability purposes within competition rules. The ACM also wants to ensure that consumers can trust information on sustainability provided by companies. Market research In 2025, the ACM will launch five new general market reviews. Specifically, it will look at (i) veterinary practices, (ii) (digital) learning resources, (iii) computerised consumer prices, (iv) the fixed internet budget segment and (v) the development of the hydrogen market. In this way, the ACM can look at the (dis)functioning of these markets without concrete suspicions of violations. For instance, in the veterinary practice market, the issue is that many practices have become owned by investment funds in recent years, which may have led to sharp price increases. In its market studies, the ACM will use its new “Methodology for market research” published in February 2025 (link). In this document, the ACM describes the reasons for (the selection of) market investigations and the process of market investigations. What does this mean for you? The ACM’s 2025 agenda could be significant for several parties. For companies, it is likely that increased compliance requirements will be introduced, especially in the digital sector. More enforcement can also be expected with regard to dissemination of (online) disinformation on sustainability issues or misconduct related to online sales or gaming. Furthermore, the ACM wishes to encourage a healthy market and create more opportunities for companies to realise sustainability initiatives. Consumers can also expect some change. For instance, protecting consumer rights (especially within the focus areas) is one of the ACM’s priorities, and it intends to achieve healthy markets and price formation for consumers through its market investigations. Companies active in the sectors under investigation by the ACM, can expect to receive questions from the ACM. Do you have any questions on this topic? Or do you, as a company, need support in contacting the ACM? Feel free to contact Monika Beck or one of our other specialists.

In the dynamic world of startups and innovative companies, venture capital (VC) plays a crucial role in funding growth potential. But what exactly is venture capital, how do Venture Capitalists work and what is their role in the investment ecosystem? In this article, I take a closer look at the definitions, processes and strategies behind venture capital, as well as the role VC plays in the Dutch startup economy. This article is the first in our series about venture capital. Definition of Venture Capital Venture capital is a form of financing that focuses on (innovative) start-ups and small companies with high growth potential. These target companies are in their development phase, are generally not yet profitable and depend on external money for their further growth and development ambitions. VC investors invest in these companies to further support their initial development or rapid growth. It is important to note that venture capital usually focuses on companies that have already achieved some degree of validation. This means they would have a working product, an initial customer base, or have demonstrated clear market potential. Venture capitalists rarely invest in completely untested ideas, which sets them apart from earlier funding sources such as angel investors or the 3Fs (family, friends and fools). How Does Venture Capital Work? Investors and Sources of Capital Venture capitalists are professional investors who put their capital into companies with high growth potential but also inherent risk. These investors obtain their capital from various sources, including external investors called Limited Partners (LPs) and sometimes from their own funds. LPs can be pension funds, university endowments, family offices or high net worth individuals. VC parties also often act jointly and, in the Netherlands, regularly with government-funded parties such as Regional Development Companies (Regionale Ontwikkel Maatschappijen). The consortium of collaborating investors then takes a joint position within a start-up. Phases of Investment The process of venture capital investment involves several stages: Investors use their personal networks, recommendations and online platforms to identify interesting young companies (deal sourcing). In the deal screening phase, startups are assessed based on criteria such as market potential, team expertise and innovation. A thorough due diligence is conducted to assess the feasibility and risks of the investment. This process includes a comprehensive audit of the startup to evaluate finances, operations, legal aspects, market position and more. At the investment committee stage, the final investment decision is made (FID) by a group of experts and partners. After due diligence, the venture capital firm generally prepares a term sheet and other relevant documents and structures the deal. Once the necessary documents are signed, funding is provided through capital contributions to the company (capital deployment). In practice, the actual capital investments often take in several rounds/phases, each with specific goals and conditions. The first formal investment round, also known as the seed round, focuses on product development and market validation. The subsequent series A round focuses on refining the business model and accelerating growth. All rounds (series B and beyond) after that focus on scale-up and expansion. Each round typically entails more capital and higher valuations, but often also contains more stringent requirements on the company’s performance. Conditions and Risks In return for their financial investment, venture capitalists receive partial ownership of the company and, often, a say in its operations. This then usually takes the form of a seat in the board, supervisory board or otherwise. Investors may also make other demands, such as the right to future investments, the right to get their investment back on a priority basis or the possibility to sell the company at a profit after a certain period of time. Venture capital is a risky type of investment because the companies are still in the early stages, have little or no revenue and have not yet proven that they will actually be successful. The exit strategy, or how the investor can sell its shares, may therefore be uncertain or unclear. It is crucial to understand that most venture capital investments are not successful. VC firms expect to earn their returns from a small percentage of their investments – often only 10-20% of their portfolio. These ‘winners’ must generate sufficient returns to offset losses on the other investments to still generate an attractive total return. This showcases the high risk-return ratio in the venture capital sector. Exit Strategies The main goal of investors is to earn a return on the money invested. This is usually done by selling the shares after a certain period, on average between 3-7 years, through an initial public offering, merger or acquisition by another company or investor. Although initial public offerings and acquisitions are the most common exit strategies, they depend heavily on market conditions and the performance of the startup. Not every company will achieve such a successful exit though. Venture capitalists consider different scenarios and then adjust their strategies as the company evolves. In some cases, a secondary sale of shares or a recapitalisation can provide an alternative to the usual exit routes. Role in the Startup Economy Venture capital is an essential source of funding for start-ups and innovative companies, especially when traditional bank loans are too difficult to obtain. It helps in the rapid growth and development of these companies and can lead to exponential growth across the startup ecosystem. Networking and relationships play a crucial role in deal flow. VCs often invest in startups with founders they know or through recommendations from trusted sources. A strong network can significantly improve access to high-quality investment opportunities. Networks not only play a crucial role in deal flow, but also influence the quality of due diligence and strategic decisions. Strong networks enable VCs to gather in-depth, reliable information on potential investments. They also facilitate access to industry experts, potential customers and partners, which significantly increases the value a VC can add to a startup. Moreover, good networks can help find suitable executives or board members for portfolio companies. VC firms based in thriving entrepreneurial regions, such as Silicon Valley, New York, Berlin, Stockholm or Tel Aviv and closer to home ‘Brainport Eindhoven’, BioScience Park in Leiden, the Amsterdam region or metropolitan region of The Hague-Rotterdam, generally have better access to deal flow than firms in less active areas. Said regions offer a rich ecosystem of startups, talent and resources. VC firms that specialise in specific sectors or industries are more likely to get a better deal flow as they have deeper understanding of the market and are better able to identify promising startups. Specialisation can also help make due diligence more efficient and make better investment decisions . The main sectors currently attracting VC investment are information technology, healthcare/biotechnology, fintech and consumer products and services. Conclusion To summarise, venture capital is a complex but essential part of the startup economy. By understanding the phases of deal flow, the key players in the VC ecosystem, and the factors that influence deal flow, both entrepreneurs and investors can develop strategies to be more successful. Mitigating challenges such as a limited deal flow, investor competition, time constraints and risk management is crucial to achieving success in the world of venture capital. By using technology, building strong networks, and implementing efficient processes, VC firms and entrepreneurs can effectively navigate the dynamics of deal flow and increase their chances of success. With the right strategies and mitigation measures, both entrepreneurs and investors can benefit from the potentially high returns that venture capital has to offer. Contact Do you have questions about bad leaver or good leaver clauses or want to exchange views? If so, please contact Mathijs Arts, Reinoud van Ginkel or one of our other Mergers and Acquisition (M&A) specialists.  

On 22 January 2025, the District Court of The Hague handed down its judgement in the final relief proceedings initiated by Biogen against Sandoz, Polpharm, Neuraxpharm and Mylan (collectively referred to as “the Generics”). It ruled that EP 2653873 (“EP 873”) of Biogen on dimethyl fumerate (DMF, marketed as Tecfidera®), is invalid. EP873 protects the use of an orally administered pharmaceutical composition containing the active ingredient DMF for treating multiple sclerosis (MS) with an effective daily dose of 480 mg DMF. DMF has been known since the 1990s as a drug for treating psoriasis. Inventive step Shortly after the Generics listed their generic 480 mg DMF products in the G-Standard (pricelist) for October 2022 and after health insurers designated some of these products as preferential in NL, Biogen sued  the Generics for infringement of EP 873. The Generics counterclaimed for revocation of Biogen’s patent, inter alia arguing that EP 837 lacked inventive step or sufficiency of disclosure (G2/21). The Generics relied on a clinical study that demonstrated the efficacy of 720 mg DMF per day and the potential for a lower dose to also be effective for the treatment of MS. The clinical study became part of the prior art through two pre-priority date presentations called ‘Kappos I’ and ‘Kappos II’. In the proceedings, both Biogen and the Generics acknowledge that Kappos I and II are full prior art and disclose the use of DMF as an effective drug for the treatment of MS. Starting from Kappos I or II, the Court found that the only difference between Kappos I or II and EP 837 relates to the 480 mg per day dosage set forth in claim 1. During the oral hearing it was established that both parties found that the administration of DMF to treat MS at a dose of 480 mg per day is as effective as administration of 720 mg per day. Therefore, the Court considered that the objective technical problem that the patent tries to resolve is to find an alternative treatment for MS that is as effective as the state of the art, namely the administration of DMF of a dose of 720 mg per day. Biogen argued that the objective problem was to find an improvement in the oral treatment of MS, but the Court rejected this argument and held that – unlike the apixaban case – the patent application (parent patent) of EP 837 did not describe an improved treatment. In addition, the Court found that the purpose of the patent application was not to find the best dose of DMF, but to screen for potentially MS-active substances similar to DMF. Agreeing with the Generics, the Court is of the opinion (5.39) that the skilled person, starting from Kappos I and/or Kappos II, and the general common knowledge,  knows that the efficacy (and therefore the effectiveness) of DMF is dose-dependent and that lower doses are also effective for the treatment of psoriasis. The skilled person would therefore have a reasonable expectation of success that this problem for an alternative dose could be solved in an obvious way by testing lower doses of DMF. Contrary to Biogen’s argument, the skilled person would then carry out those tests. In this way, with routine testing and thus without inventive effort, the skilled person would find that a dose of 480 mg per day has a therapeutic effect. Therefore, claim 1 of EP 837 is obvious. The two auxiliary requests filed by Biogen are also dismissed by the Court. Sufficiency of disclosure The Court also addresses the ‘squeeze’ that the Generics identified, namely that in case EP 873 would be found inventive (quod non), it lacks sufficiency of disclosure and is (also) invalid for that reason. The Court held that the patent or application must sufficiently disclose the subject matter allowing the skilled person to apply the invention over the whole range claimed by the patent without undue burden. Second medical use claims bring about that it must be tested whether the therapeutic effect of the composition and dosage regimen for the claimed medical indication (in this case MS) is disclosed in the application/patent or, in the absence thereof, is credible. In relation to G2/21, the Court states that if the desired technical effect is part of the claim, but the patent does not prove or at least make plausible that this technical effect is achieved by the teachings of the patent, nor does the person skilled in the art assumes this on the basis of the common general knowledge or the cited literature, then there is insufficient disclosure. The Court found that that the application says nothing about the efficacy of the claimed dosage of DMF in treating MS. Since the Court does not consider any experimental data other than Kappos I and II, EP 873 is lacks sufficiency of disclosure. Parallel proceedings  The decision handed down by the District Court of The Hague is the first decision in final relief proceedings to hold (the NL part of) EP 873 invalid. To date, only Sweden has ruled in final relief proceedings on (the validity of) EP 873. The Swedish Court found EP 873 valid and imposed an injunction on the generic companies. Earlier Biogen commenced several PI proceedings in various European countries. In the Czech Republic, Denmark, Latvia, Slovakia, Estonia, Ireland and Sweden, PI’s were granted. In contrast, in Austria, Belgium, Portugal, Slovenia, Italy, France, Spain, Estonia, Germany, Norway and Hungary, PI’s were rejected because the patent was found invalid on a preliminary basis. Conclusion It remains to be seen if the NL judgement on the invalidity of EP 873 is going to be followed by other European jurisdictions.

On 8 January 2025, the District Court of Midden-Nederland gave judgment in the ‘Essure case’ (ECLI:NL:RBMNE:2025:10). Drug manufacturer Bayer marketed a permanent sterilisation method for women called ‘Essure’, which had to be implanted on the fallopian tubes. The Essure Claims Foundation (‘Foundation’) brought a mass tort action against Bayer. The Foundation claimed that many women became seriously ill from this sterilisation implant. In its judgment, the court ruled on a number of formal points regarding, among other things, the applicability of the WAMCA and the admissibility of the Foundation in the proceedings. The court ruled in favour of the Foundation on all points. Below, we highlight some noteworthy points of the judgment. Temporal application of the WAMCA: no cut-off The WAMCA applies to collective actions that (i) are brought after the WAMCA came into force on 1 January 2020 and (ii) relate to events that took place on or after 15 November 2016. Bayer believes there should be a cut-off in the claims of the Foundation. Bayer argues that with regard to implants placed before 15 November 2016, the old statutory regime (WCAM) should be applied; only with regard to implants placed on or after 15 November 2016 should the WAMCA be applied. The court is of another opinion. The court considers that there is a series of events, as the women have in common that they all had the Essure implanted, but at a different point in time. According to the court, this series of events consists of the same, repetitive event that caused the alleged harm to several individual women who belong to the circle of persons whose interests the collective claim seeks to protect. This series of events did not end until after 15 November 2016. Therefore, the court concluded that the WAMCA applies to all of the Foundation’s claims. The claims for material and non-material damage can be bundled An foundation who can start a mass-litigation case under the WAMCA can only bring an action if it seeks to protect similar interests of the persons involved. This similarity requirement is met if these interests lend themselves to bundling. As a result, the special circumstances of the individual parties need not be considered in the proceedings. In addition to material damages, the Foundation also claims immaterial damages for the women who had Essure surgically removed. The Foundation divided the women into 17 categories and claimed a lump sum of damages for each category. Bayer takes the view that the claims cannot be bundled in this case, as according to Bayer, immaterial damages depend on individual facts and circumstances. In doing so, Bayer also relies on the Supreme Court’s ruling on earthquake damage in Groningen. In this judgment, the Supreme Court ruled that immaterial damage due to impairment of the person cannot be determined on a flat-rate basis, as this is not compatible with the highly personal nature of such damage. Again, the court is of another opinion. The court considers that, unlike in the aforementioned Supreme Court judgment, in the present case, immaterial damages are not claimed for personal impairment. In the present case, immaterial damages are claimed because the women suffered personal injury. As a result, according to the court, immaterial damages are even more logical than for an impairment in person. According to the court, it is not necessary that the women also suffered mental injury. The court concludes by considering that it is therefore possible that it may find that the immaterial damages suffered by the women are at least a certain (lump sum) amount. The court concludes that the Foundation’s claim for compensation for both material and immaterial damages are bundleable. Thus, the Foundation is admissible in all its claims, including those relating to the immaterial damages. Litigation funder’s fee of 28.75% is not unreasonable In the context of the admissibility of the Foundation, it must be assessed whether or not the litigation funder’s fee is prima facie unreasonable. The amount of the litigation funder’s fee should not be such as to disadvantage the women or provide an unacceptable incentive for the litigation funder to push for an adverse outcome for the women. It has been agreed with the litigation funder that it will receive 25% of the potential damages. In addition, it has been agreed that the litigation funder may charge all its incurred costs up to a maximum of 5% on the potential damages. This therefore means that a minimum of (95% minus 25% =) 71.25% of the damages will accrue to the women; the litigation funder can therefore potentially receive 28.75% of the damages. Dutch case law states that a range of 10 to 25% can be considered the maximum fee for a litigation funder. The court finds that the Foundation has sufficiently substantiated why a fee of more than 25% is reasonable. The Foundation has substantiated that it intends to recover the costs of the proceedings from Bayer by means of an actual litigation cost order or an equal agreement in a settlement. The Foundation has further argued that it is still uncertain what costs will be eligible for reimbursement through a (litigation) order or settlement. The amount of costs to be incurred is also still uncertain. In view of this, the court concludes that the Foundation has sufficiently substantiated that the agreed fee is not unreasonably high. Therefore, this does not pose an issue for the admissibility of the Foundation. Conclusion The Foundation’s victory shows that both the applicability of the WAMCA and the admissibility of foundations that are litigating under the WAMCA can be applied practically. Questions about the WAMCA? Please contact Lennart Hoeksema, Arnout Koeman or one of our other WAMCA specialists.

Article 7:653a of the Civil Code dictates that an employer may not prohibit or restrict an employee from performing ancillary activities  unless there is an objective reason for doing so. How does this clause work in practice, specifically when an employee is sick?    The effect of the ancillary activities clause  Ancillary activities are activities that an employee performs outside of his work. In principle, ancillary activities are permitted. In practice, the clause often includes the condition that an employee may only perform ancillary activities with the prior consent of the employer.  The employer may only refuse such consent if he has an objective justification. Examples of such an objective justification included in the law are:  the health and safety of the employee;  the protection of confidentiality of company information;  the integrity of public services;  the avoidance of conflicts of interest; and  the violation of a legal requirement.   The employer does not have to include the objective reason in the employment contract but must provide it when invoking the agreed-upon clause.  Performing ancillary activities during illness  Suppose an employee is sick and the employer finds out that this employee is performing ancillary activities. How does a judge rule in such a situation? In a case before the District Court of The Hague, an employee of the municipality of Amsterdam reports in sick. This employee is receiving  benefits due to occupational disability of 80-100%.   In July 2022, this employee reports in sick for her reintegration work due to a corona infection. The employer submits a termination request to the Netherlands Employees Insurance Agency (UWV) due to  long-term disability, but it is rejected because recovery is considered possible within 26 weeks. In October 2023, the employer again applies for a dismissal permit, which is then rejected because it turns out that the employee has been performing similar work at the Municipality of Rotterdam. An integrity investigation follows which shows that the employee has been working 24 hours a week at the Municipality of Rotterdam , which she did not report as stated in the absence protocol and code of conduct of the Municipality of Amsterdam. The Subdistrict Court ruled that the employee had violated Section 8 of the Civil Servants Act, which constitutes a breach of contract. The employee should have reported her intention to enter the service of the Municipality of Rotterdam. The employee should also explicitly have  asked permission to do so, and should have reported this to the company doctor. What was reported by the company doctor cannot be interpreted in any other way than that there was (a degree of) intent on the part of the employee to mislead the company doctor and therefore also the municipality. The overpaid wages must be repaid by the employee (Section 7:629 (5) of the Dutch Civil Code). The employment contract is terminated, without awarding the transitional compensation.  Practical tips for employers  Although the inclusion an ancillary activities clause employee may be important, an employer can also take steps in the situation where no clause is agreed upon but the employee does perform ancillary activities  during illness. The employer has several options depending on the situation. The employer may have grounds to  dismiss the employee either by instant dismissal or through a termination  procedure in court. In the latter case, the employer can choose to terminate  the employment contract for breach of contract. The options are highly intertwined with the circumstances of the case; in some cases, the employer has to tolerate that the sick employee also performs work elsewhere.  Contact Would you like to know more about ancillary activities? Feel free to contact Gerard Zuidgeest, Rose Horstman or one of our other specialists in employment law. Do you have another question? With expertise in eighteen areas of law, La Gro is happy to assist  you.

It is often assumed that Dutch employment law requires an employer to initiate a mediation process before an employment contract can be terminated  on the grounds of irreconcilable differences in the employment relationship (the g-ground).  Such a requirement is based on  case law, where mediation is often deemed necessary as an effort that can be expected of an employer in order to restore the relationship. But is mediation always mandatory, or can the employer in some cases make a plausible case that there is no longer any point in initiating mediation?  The Court of Appeal of Den Bosch recently ruled that in that specific case an attempt at mediation was not  necessary. The case in question involved a small organisation with only six employees. The employee had been hired as a driver, with the prospect of becoming a shareholder. However, it soon became apparent that this partnership would not succeed. The employee had scolded his supervisor stating he was a  “bad manager” and the employee had been working under the influence of drugs. The employee claimed that his behavior stemmed from a lack of recognition, while the employer proposed a personal improvement plan. The employee refused to cooperate with this plan. He had also called in sick; the company doctor recommended mediation. Eventually, the employer proposed a settlement agreement to end the employment agreement, but an agreement could  not be reached.   The employer petitioned the subdistrict court to terminate  the employment contract because of a disrupted working relationship. The employee argued that the elements to terminate the employment agreement due to irreconcilable differences (g-ground) was not sufficient because no mediation had taken place, despite the company doctor’s advice.  The appellate court ruled that mediation was  not mandatory in this situation. The appellate court ruled that the relationship between the parties had hardened to such an extent that mediation had no chance of success. The size of the organisation also played a role: with only six employees, re-employment or avoidance of contact between the parties was impossible. The court emphasized that an employer is not obliged to start a mediation process “against his better judgment,” even if the company doctor advises it. According to the court, the company doctor’s advice in this case was a standard response, without knowledge of the actual gravity of the situation.  Practical implications   This ruling seems to be an exception to the general line in case law, where mediation is often seen as necessary. Especially if the company doctor advises mediation, since an employer will want to avoid being blamed for ignoring the advice of the company doctor in the context of illness.  At the same time, this case is quite common in  practice. In many cases it is quite clear that an employment relationship has been disrupted to such an extent that recovery seems out of the question. This ruling  may well set a precedent for smaller employers. However, it remains important to consider whether mediation can be useful in a particular case. If an employer skips mediation too easily, he runs the risk of a termination request being denied and having to (temporarily) retain the employee in question or to pay a high termination fee.  Do not come to the conclusion too quickly that no mediation needs to take place.    Practical tips for employers  Evaluate the situation carefully: seriously consider whether mediation really does or doesn’t have  a chance of success; it should not be ruled out too quickly; Document well: if mediation is not an option, make sure you can justify and corroborate this, such as with correspondence or statements about the seriousness of the situation.  Smaller organisations:  an additional argument for skipping mediation may be found in the fact that contact between severing quarreling colleagues cannot be prevented due to the size of the organization. In larger organizations, however, transfer will often be a possible outcome and thus mediation will more often be an obligation to which the employer must cooperate.  Company doctor’s advice: while the advice of a company doctor to start mediation is important, an employer does not always have to blindly go along with it if it is clear that the prospects of reconciliation are highly unlikely.  How can La Gro be of assistance?  Feel free to contact Gerard Zuidgeest, Jaap Harrijvan or one of our other specialists in employment law. Do you have another question? With expertise in eighteen areas of law, La Gro is happy to assist  you.

Most employment contracts include a confidentiality clause. Under such a clause, the employee is obliged to keep sensitive company information confidential. It may happen that an employee downloads confidential and sensitive data, for example on his private laptop or phone. This could have major consequences for the employee.  Case Law  In a recent case before the District Court of Gelderland, both a confidentiality clause and a penalty clause had been agreed upon in the employee’s employment contract. The employer had informed the employee that he was dissatisfied with the employee’s performance and intended to terminate the employment relationship. A few days after the employer presented the employee with a settlement agreement, the employer received a security alert from Microsoft due to suspicious activity on the employee’s account.   When questioning the employee regarding the suspicious activities, it appeared that the employee had downloaded company files on his private laptop. The employee feared being excluded from access to his work environment and therefore could not defend himself against the alleged underperformance at work. However, the employee had downloaded a significant amount of files including reports from the company physician and performance of other staff members subordinate to employee.  The judge ruled that downloading all of this company-sensitive information was culpable. The employee thereby seriously damaged the employer’s trust. However, the high bar of serious culpability was not met because, in the judge’s opinion, the employee did not act intentionally to harm the employer.   In a recent similar case before the Court of Appeal in The Hague, an employee had also downloaded confidential and sensitive company information for the purpose of his defense at the the Netherlands Employees Insurance Agency (UWV). In this case it was not established whether the employee had only downloaded information which he could use for the procedure or also other (confidential) documents. The immediate dismissal by the employer was upheld.  Practical tips for employers  As an employer, it is wise to check whether an employee has downloaded information in the context of a dismissal case. Because the verification should not violate the General data protection regulation (AVG), it is good to have a policy in place when certain information may be checked. Sending confidential information can constitute  a violation of the confidentiality clause. If the employment contract includes a penalty clause for this circumstance, the employer can impose a fine on the employee.  It is wise to design the confidentiality clause so that even sending company information to employees’ own accounts counts as a violation.  Can La Gro be of assistance?   Do you have a question about confidentiality and protecting company information? Feel free to contact Gerard Zuidgeest, Rose Horstman or one of our other specialists in employment law. Do you have another question? With expertise in eighteen areas of law, La Gro is happy to assist  you.

On 19 December 2024, the Dutch Consumer & Market Authority (“ACM“) announced that it has clarified and updated the merger notification process (link in Dutch only). A concentration is a merger, an acquisition or the creation of a joint venture. Background Under Dutch competition law, companies must report a merger, acquisition or joint venture to the ACM if they meet the following two conditions: (i) the companies merging have a combined annual turnover of EUR 150 million or more worldwide and (ii) at least two of the merging companies each have an annual turnover of €30 million or more in the Netherlands This notification takes place by submitting a notification form. In this form, the parties to the transaction provide details (for example) of the parties and their activities, the markets in which they operate and what position the parties occupy in these markets after the transaction (and whether this is problematic or not). The notification to the ACM is separate from a notification to, for example, the Dutch Healthcare Authority (NZa) or the Investment Screening Bureau (“BTI“). Regarding a notification to the BTI under the Vifo Act, see our previous blog (link). Current practice Currently, it was already common practice to (informally) contact the ACM to announce a notification in advance. Often, the opportunity was then also immediately taken by (an authorised representative of) parties to provide (summary) information about the notification, such as information about the parties, (the lack of) overlap in terms of parties’ activities and the type of transaction. This contact moment could especially benefit the speed of non-problematic reports (on the condition that sufficient information was provided beforehand). New practice The ACM has now made this notice mandatory for every notification and formalised it through an intake form on its website (link in Dutch only). This intake form must be completed “about a week” before the official notification. By doing so, companies already provide relevant information to the ACM, for instance on the type of transaction and on the activities of the companies involved A practical addition is also that parties can indicate in advance if they cannot answer certain questions in the notification form. For example, it often happens that parties do not have direct contact details of their competitors in the market, while the ACM should receive this information according to the notification form. In our experience in the past the ACM was not very strict in answering this question for non-problematic notifications. In that case, parties usually received an (implicit) waiver to provide this information. From now on, the ACM will explicitly contact parties to reject or grant the request to leave questions unanswered. Finally, the ACM has taken the opportunity to bring the notification form more in line with the European Commission’s notification form. For instance, the ACM now requires parties in the notification form to prepare a summary for the Official Gazette and NACE codes (i.e., activity codes of a company link) must be included. The European Commission requests similar information in its own notification form. Analysis We welcome these developments. This is the latest step in a longer-running process by the ACM to simplify the notification process. At the same time, this reduces the burden on companies during the notification process. This process started several years back with the possibility of submitting a notification to the ACM digitally. It has now led to an intake form on its website. Especially for those notifications where the ACM already immediately sees no problems (e.g. because the parties to the transaction have no overlap in their activities), these measures are expected to lead to faster turnaround times. At the same time, this gives the ACM more room for those notifications that seem more problematic. Questions Do you have any questions on this topic? Or do you need support as a company with a notification to the ACM? If so, please feel free to contact Arnout Koeman or one of our other specialists.

In November, we wrote a blog on pseudo self-employment and the lifting of the Dutch tax authority’s enforcement moratorium from 1 January 2025 onwards. The article provided a step-by-step plan for identifying collaborations with self-employed people and adjusting them where necessary and possible. The aim of all this was to avoid abusive employment relationships (as much as possible) and to be prepared for the Dutch tax authority’s doubling down on enforcement regarding pseudo self-employment. On 18 December 2024, the State Secretary for Finance further informed the Lower House about the enforcement plans for 2025. In addition, the Dutch tax authority has published its Enforcement Plan for labour relations 2025 . The conclusion is that a number of mitigating measures have been taken, softening the blow from enforcement in 2025. In brief, these measures are as follows. No fines from pseudo self-employment enforcement The main update is that in 2025, the Dutch tax authority will impose no fines whatsoever on employers who continue to work with self-employed workers on a pseudo self-employment basis. This applies to both default penalties and punitive fines (unless malicious intent is involved). It was already known that no punitive fines would be imposed; so what is new is that no default penalties will follow. However, more relaxed measures have been announced to give companies and organisations more time to adjust their operations. Soft landing for pseudo self-employment enforcement The Dutch tax authority has further announced the following relaxations in its enforcement plans: To begin with, ‘in principle’, there will be a company visit and thus ‘in principle’ not an inspection of the accounts (audit). In this way, the Dutch tax authority is responding to the request of the Lower House to be able to warn organisations before account inspections are initiated. A company visit is not a mandatory gateway, but it does offer the possibility of an initial warning. A warning is obviously less severe than enforcement, which will follow if something is found to be wrong during a company visit. When and which choice will be made for the type of visit is not yet entirely clear; there will be further guidance on this, expected during January 2025; There is a possibility of pre-consultation with the Dutch tax authority, which can be requested via a digital application form. This makes sense if an organisation works with many self-employed people and to this end has developed a working method that properly ensures effective self-employment[1]; All currently existing approved model agreements will be automatically extended until 31 December 2029. This means that if the model agreement is strictly followed in practice, it should provide assurance that there is no pseudo self-employment. Of course, the trick remains to organise things on the shop floor in such a way that the self-employed worker actually determines his or her own work and there is no question of employer authority. Enforcement in 2025 The measures announced by the Dutch tax authority may reduce the sense of urgency to adjust business operations with self-employed workers. However, despite the soft landing, which is certainly in place, as far as we are concerned, organisations would do well to make a start in 2025. Now is the time to develop a new and future-proof method of managing and embedding self-employed workers at clients’ workplaces. Full enforcement will actually begin in 2026, meaning the reimposition of fines. Contact We are aware that many of our clients will be affected by Dutch tax authority enforcement. Within our team, Angela van der Does-Mekes and Gerard Zuidgeest deal with this topic on a daily basis. Do you also have questions and want to exchange views on whether the self-employed workers you hire are not actually employed? Then please contact either of these, or one of our other specialists. The Dutch tax authority is again taking pseudo self-employment enforcement measures. La Gro – keeping you informed of the latest updates, including that no fines will follow in 2025.

Introduction  All over Europe, people perform work through digital work platforms. In the European Union, it is estimated that there will be about 43 million platform workers in 2025. Through a platform, services are offered through an application or website. These services are performed by working people (platform workers). In 2022 there were 28 million platform workers which means there has been a significant growth in this market. When platforms operate in different member states or across borders, it is often unclear by whom the platform work is performed, especially when it comes to online platform work.  To bring more clarity, the European Platform Work Directive was published on Oct. 2, 2024. The European Union wanted to provide minimum rights for platform workers and rules for better protection of the personal data of individuals who perform platform work. With this directive, the European Union also wants to improve the transparency of platform work, including in cross-border situations.   Privacy Aspects Directive Platform Work  Digital work platforms use algorithms such as computerized monitoring systems and automated decision-making systems, for tasks that were previously generally performed by managers. These include, for example, assigning tasks, pricing individual jobs, determining working hours, giving instructions, evaluating work performed, stimulating incentives or applying adverse treatment. The algorithms have a great impact on the worker, while the worker often does not have access to information about how the algorithms work, what personal data are used, or how their behaviour affects the decisions made by the systems. The Platform Work Directive therefore sets rules regarding the use of algorithms by digital work platforms.  Platforms will first have to provide clear information on the use of automated systems and how these systems work. In addition, the directive sets limits on the type of data that may be processed by automated systems: no personal data on emotional or psychological state, no data relating to private conversations, no data to predict (possible) union activity, no data to infer racial or ethnic origin, migration status, political opinions, religious beliefs or health status, and no biometric data. Finally, human oversight of automated systems will be mandatory.  Employment law aspects Platform Work Directive  Pseudo self-employment Currently, most platform workers are formally self-employed. As recent case law shows, they may in fact have an employment relationship and therefore should enjoy the employment rights and social protection afforded to workers under national and EU law. Read our blog on pseudo self-employment here. However, Member States approach platform work differently.   Legal presumption for employees One of the goals of the Platform Work Directive is to make it easier to correctly determine the employment status of platform workers. Article 5 of the Platform Work Directive therefore includes a legal presumption. A platform worker is presumed to be an employee when there are actual indications of “control and direction”. In such a situation, a worker can suffice with the assertion that he is in fact an employee. The platform must disprove this assertion, which means that it is up to the platform to prove that there is no employment relationship.  Safety and health of platform workers The Platform Work Directive also stipulates that Platforms must take the necessary measures to guarantee the safety and health of platform workers. This may include taking measures to combat violence and (sexual) harassment. Furthermore, Article 17 introduces an obligation to report so that Platforms are registered by formal authorities. For example, the platform will report the number of people that perform platform work, the applicable general conditions, the income level and the average duration of the deployment.  Implications for practice  Platform work will from now on be regulated by European legislation. Member States have two years to implement the Directive. At this time there is no concrete legislative proposal. When developments occur within the framework of this Directive, we will inform you.  It is wise for platforms to look ahead and prepare for these future rules. As a result of implementation of the Directive, platform workers may be classified as employees sooner. In addition, platforms may need to adjust their processes regarding the use of algorithms and automated systems.   Contact  Do you have questions about protecting personal data in the context of platform employment? Or do you have questions about the employment law aspects of platform work? Please contact Frederiek Beuning or a colleague from the Data & Privacy Team or Rose Horstman or a colleague from the Labor Law Team. They will be happy to help you further!  Find the Platform Work Directive here.

On 19 December 2024, Dutch Minister of Economic Affairs Beljaarts officially announced his intention to extend the scope of the Act on Security Screening of Investments, Mergers and Acquisitions (the “Vifo Act“), requiring that the Vifo Act be amended. Background The Vifo Act was introduced to give the Dutch government more control over mergers and acquisitions by – foreign – parties that could potentially affect the national security of the Netherlands. This means that, in certain – sensitive – sectors, a buyer must pre-notify the Investment Review Office (“BTI“) of their intention to acquire or merge with a company. Any transaction may only be executed/completed once the BTI has assessed that there are no national security risks or that any risks are covered by control measures (the standstill obligation). Current scope Under the current Vifo Act, a transaction must be reported to the BTI if the target company operates in one of the following sectors (or is specifically designated in the Vifo Act): Heat transport, nuclear power, Schiphol airport, port of Rotterdam, banking sector, financial market infrastructure, extractable energy or gas storage; Sensitive (or highly sensitive) technology (dual-use products, military goods, quantum technology, photonics technology, semiconductor technology and high assurance products); or Corporate campus operators. This covers a broad list of the largest and most important companies based in the Netherlands, including Schiphol and the port of Rotterdam, but also ASML and nuclear power plant Borssele. Extension to the scope In essence, the legislator wants to extend the scope of the Vifo Act to include more technological sectors. The bill, which is still under consultation, will add biotechnology, AI, advanced materials and nanotechnology, sensor and navigation technology and nuclear technology for medical uses to the scope of the Vifo Act. An example of nuclear technology for medical uses is the nuclear reactor in Petten. This reactor produces isotopes for medical use for a large proportion of cancer patients worldwide. Under the new proposal, the sale of this reactor would also require screening by the BTI. This change in the law could possibly take effect from as early as 1 July 2025.    Any questions? If you have any questions on this topic or your company needs support with a Vifo Act-related notification to the BTI, then please contact Arnout Koeman or one of our other specialists.

Heads-up: there has been an update on this subject. The Dutch Tax authority has taken mitigating measures, softening the blow from enforcement in 2025. As of January 1, 2025, the Dutch tax authority will fully enforce on pseudo self-employment. For every client who works with freelancers and where the freelancer can actually be considered an employee, this enforcement on false self-employment can have major legal and tax consequences. What is pseudo self-employment? Pseudo self-employment means that a contractor is formally regarded as self-employed, but in practice works under circumstances that are more similar to an employment contract. This can be the case, for example, if the contractor works side-by-side with your own employees and has little control over his prices, working hours and the way he should perform the work. With pseudo self-employment, actual independence is often lacking, such as own investments, own acquisition, multiple clients or bearing (financial) entrepreneurial risk. This can lead to disguised employment, where the employment relationship meets the legal characteristics of an employment contract. Risks in pseudo self-employment The tax authorities play an important role in the assessment of pseudo self-employment. They look  whether the criteria for an employment contract are actually met, namely authority, personal work and a (fixed) payment. The agreements you have made with the self-employed person, for example that no employment is intended, are therefore not decisive. If false self-employment is established, the tax authority can hold both the client and the self-employed person liable. This often leads to retroactive levies of payroll tax and social security contributions, as well as possible fines. In addition, the self-employed can successfully claim the rights of an employee, such as dismissal protection and continued payment of wages during illness. For clients, the financial and legal consequences are significant, which emphasizes the importance of carefully assessing the employment relationship. “VBAR” Act The case law surrounding pseudo self-employment has been evolving in recent years. More test criteria are determined and more and more often conclusions are drawn that there is an employment contract, regardless of contracts to the contrary. These developments have led to the legislative bill Verduidelijking Beoordeling Arbeidsrelaties en Rechtsvermoeden (VBAR), which will (possibly) take effect on January first, 2026. Practical consequences Although the VBAR Act is not yet in place, the tax authority is drawing its own plan. As of January first, 2025 the Dutch tax authority will fully enforce on pseudo self-employment. This means that all organizations (companies, but also governments and health care institutions) that employ self-employed workers for work that should actually be done as employees, can expect fines and additional taxes up to a maximum of 5 years back. Relevant to note is that the lifting of the enforcement moratorium has no retroactive effect. The tax authorities will not check for employment relationships that were not properly qualified before January first, 2025 (barring malicious situations). Furthermore, there will be a transition period of one year during which clients will not yet be fined if they demonstrate that they are taking measures against false self-employment. Think for example of processes aimed at reducing the number of abusive self-employed relationships or converting these self-employed relationships into employment. Advice: check your pseudo self-employed As a result of the lifting of the enforcement moratorium, as of January 1 2025, you will be at immediate risk if assignment relationships with self-employed persons in practice contain characteristics of an employment relationship. It is therefore important to take action now and take stock of your collaborations with self-employed persons and adjust them where necessary and possible. We would like to give you a step-by-step plan to check the collaborations and take measures: 1) Make an inventory of all people working for your organization on the basis of a contract of assignment, including positions (core, staff or “company alien”), nature, scope and duration of the assignment and rate agreements; 2) Assess for each self-employed person what contractual arrangements have been made, whether they are being followed, and to what extent the self-employed person is integrated into your organization; 3) Assess the degree of entrepreneurship of the self-employed person, such as what financial risks does he run when performing the assignment and does he work for multiple clients; 4) Act on conclusions, engage with your freelancers and maintain the relationship as self-employed, hire through an agency or reform to employee; 5) Adjust your contracts. You can use current model agreements from the tax authority for now, but be aware that these model agreements are limited in content. Crucial topics such as liability, specifically if it is judged that there is a disguised employment relationship, are missing in them. In view of the new legislation, it is also better not to conclude assignment agreements with self-employed persons for an indefinite period of time. Would you like to know more about the upcoming enforcement by the tax authorities? Expertise in 18 legal fields enables La Gro to offer broad legal assistance. Feel free to contact Angela van der Does-Mekes en Gerard Zuidgeest or one of our other specialist colleagues.