The Dutch authorities are accelerating investigations and clearing their docket of pending cases, making increased used of out-of-court resolutions. Key sectors targeted by enforcement include financial institutions, industrial companies, and multinationals, with a focus on AML, environmental and anti-corruption compliance. Notable developments include much-awaited guidance on self-reporting and cooperation and on foreign bribery and corruption issued by the Dutch Public Prosecutor’s Office, a landmark judgment by the Dutch Supreme Court on the handling of privileged information in criminal investigations, and an initial proposal for a new sanctions act. The Dutch bar published guidance for lawyers conducting internal investigations. Looking ahead, in-house legal teams will face challenges related to data proliferation, cybercrime, AI governance, and stricter ESG obligations as well as potential enforcement of those new regimes.
Investigations trends/developments
In the last few years, the Dutch authorities have intensified their efforts to combat sanctions violations, environmental crimes, and tax fraud. This reflects a broader trend towards stricter regulatory oversight and enforcement in relation to white-collar crime. In 2024, this resulted in increased enforcement actions related to, for example, Russia-related economic sanctions, environmental offenses such as pollution and incorrect handling of waste, and tax fraud schemes such as dividend stripping.
There has also been a growing focus on personal liability of senior individuals and directors with varying success. After long-running investigations the Dutch Public Prosecutor’s Office (DPPO) closed investigations into former directors of financial institutions related to the AML-settlements reached with those institutions in 2018 and 2021. This decision set an important precedent and mitigated speculation about how far personal liability of directors might reach.
The DPPO aims to accelerate investigations and reduce its docket of pending cases. It is increasingly utilizing plea bargaining (procesafspraken) and penalty orders (strafbeschikkingen) in larger or more complex cases.
There have been harsher penalties for corporate criminal law violations. For the first time, an ultimate parent company's consolidated revenue was used by a court to calculate a revenue-based fine, which can be as high as 10% of revenue. This sets a precedent, highlighting the rising financial risks for companies under investigation by Dutch authorities.
Significant law reforms
While the general trend is an increase in laws and regulations impacting corporate criminal liability, there were no significant law reforms in 2024. However, some notable developments occurred that will impact corporate criminal liability and/or the criminal liability of senior officers:
- The DPPO issued new guidance on self-reporting, cooperation and internal investigations (aanwijzing zelfmelden, medewerking en zelfonderzoek). The guidance sets out the conditions for self-reporting, and what is expected in terms of cooperation. The guidance also sets out the expectations regarding internal investigations. A company can receive a maximum discount of 25% on applicable fines for each of self-reporting and cooperation, i.e., a maximum total discount of 50%, and there is a presumption that the company can resolve the matter out of court (through a settlement, penalty order, plea bargain or otherwise).
- The DPPO also issued amended guidance on the factors influencing prosecutions relating to bribery of foreign officials. Relevant changes to prior guidance relate to the obligation to publish a press release where there has been an out-of-court resolution through a penalty order (strafbeschikking) or settlement (transactie), and a clarification on calculating unlawfully obtained gains.
- The Dutch Supreme Court (Hoge Raad) provided guidance on handling privileged information in criminal cases, emphasizing the need for the DPPO to prevent infringements of legal privilege and involve investigative judges early in the process to safeguard legal privilege.
- The Dutch Government issued a new sanctions act for public consultation, introducing regulatory enforcement and other measures to supervise and enforce sanctions measures more effectively.
In addition to these developments, a consultation version of the new Dutch Code of Criminal Procedure (Wetboek van Strafvordering) was published, which includes a legal framework for plea bargaining and out-of-court settlements. The currently expected implementation date of the new Code of Criminal Procedure is April 1, 2029.
Internal investigations—key considerations
The scrutiny of internal investigations continued in 2024, with a particular focus on the roles of independent investigators versus lawyers. The Dutch Bar Association (DBA) issued guidance on internal investigations carried out by lawyers admitted to the bar. The DBA did not introduce any specific requirements for investigations by lawyers acting in an advocacy role (in contrast to the role of independent investigator). However, lawyers conducting investigations are required—in essence—to give an Upjohn-warning, specifying that they are acting in an advocacy role for their client. Disciplinary tribunals impose various procedural requirements on lawyers conducting investigations as independent investigators and have cast doubt on whether these types of activities are covered by legal privilege.
The DPPO guidance on self-reporting, cooperation and internal investigations (aanwijzing zelfmelden, medewerking en zelfonderzoek) sets out a number of expectations about the findings of internal investigations that are shared with the authorities (irrespective of whether such internal investigations are carried out by lawyers or other parties). The investigation must have been carried out thoroughly and professionally, the relevant findings and contemporaneous documents should have been shared with the DPPO, and the rights of individuals adequately observed.
Companies must ensure they handle whistleblower complaints carefully, e.g., by implementing proper policies and procedures to protect the rights of whistleblowers and to comply with legal and ethical standards. It is noteworthy that granting sanctioning power to the Dutch Whistleblower Authority (Huis voor Klokkenluiders) for non-compliance with the Dutch Whistleblower Protection Act (Wet Bescherming Klokkenluiders) is on the political agenda. It is expected that the Dutch Whistleblower Authority will gain such sanctioning authority in the future.
These developments highlight the need for adequate procedural protocols when conducting internal investigations.
Sectors targeted in 2024
The Dutch Government continues to prioritize the combatting of corruption, fraud, tax evasion, and environmental crime.
The Dutch Central Bank (De Nederlandsche Bank) published new guidance for the financial sector on the Dutch AML Act, with suggested good practices for a risk-based approach, e.g., relating to high-risk jurisdictions and Politically Exposed Persons (PEPs). Aside from AML, the Dutch Government has targeted financial institutions for facilitating tax fraud or sanctions evasion.
For industrial companies, the new Environment and Planning Act (Omgevingswet) entered into force in 2024. The first big enforcement cases are still pending, but regulators have announced their enforcement priorities, e.g., the Human Environment and Transport Inspectorate (Inspectie Leefomgeving en Transport) has said that the correct handling and recycling of waste materials is a priority.
Multinationals continue to be the target of corruption investigations by the DPPO.
Other regulators like the ACM have made sustainability a core focus. Attention on topics like greenwashing, has already affected the aviation and clothing industries. This could progress to criminal enforcement in 2025.
Cross-border coordinated investigation or enforcement activity
The Netherlands started to provisionally apply the provisions of part of the new Ljubljana-The Hague Convention on international cooperation in the investigation and prosecution of international crimes in February 2024. This Convention has been adopted by 68 states, and it includes provisions on the use of joint investigation teams. We expect this Convention to facilitate international cooperation going forward.
Within the EU, there have been a number of joint investigation teams working on cross-border investigations with the court proceedings originating from the EncroChat investigation continuing. A large multinational received a fine following a corruption investigation by the Dutch and Swiss criminal authorities.
Predictions for 2025
In 2025, in-house legal and investigation teams will likely face a myriad of white-collar crime and enforcement issues:
- Managing data proliferation and ensuring transparency while mitigating risks associated with cybercrime will be a challenge. As data continues to grow exponentially, the potential for cyber-attacks and AI-related fraud will increase, necessitating robust cybersecurity measures and AI governance frameworks.
- The harmonization of the anti-bribery and anti-corruption framework across the EU, driven by new directives, will introduce additional criminal offenses in the Netherlands. This will require companies to adapt their compliance programs to meet stricter regulations and avoid severe penalties.
- The growing number of sanctions-related cases and increased prosecution will also be a pressing issue. Companies will need to navigate complex international sanctions regimes and ensure compliance to avoid legal repercussions.
- ESG obligations will become more stringent, with enhanced reporting and due diligence requirements. This will place additional pressure on legal teams to ensure that their organizations meet these obligations and avoid potential investigations, enforcement or litigation.
- Finally, follow-on litigation, activism, and private enforcement will likely rise, driven by increased regulatory scrutiny and public awareness. Legal teams will be well advised to be proactive in managing these risks, ensuring robust compliance and risk management strategies are in place to mitigate potential legal challenges, as well as responding to such challenges when they arise.
Looking further ahead, in-house legal and investigation teams will encounter expanding responsibilities due to increasing regulatory pressures. These will particularly affect companies' duties in relation to (value chain) due diligence and handling of whistleblower complaints and internal investigations.
Additionally, the focus on corporate culture, corporate social responsibility, and the effectiveness of compliance policies will intensify, with greater attention on the roles of individuals responsible for these areas. This evolving landscape will require companies to adopt more robust and proactive compliance strategies that are adequately resourced and empowered to function effectively in order to mitigate potential risk.
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This article is part of the A&O Shearman Cross-Border White-Collar Crime and Investigations Review. Please click here for our overviews and insights in other jurisdictions.
