When will the Vifo Act enter into force?
This will most likely be in early 2023. The exact effective date is yet to be determined by koninklijk besluit (administrative decree).
Will the Vifo Act enter into force retroactively?
Yes. The Minister of Economic Affairs and Climate (EZK) can review acquisition activities that fall within the scope of the Wet veiligheidstoets investeringen, fusies en overnames (The Investments, Mergers and Acquisitions Security Screening Act – Vifo Act) that took place after September 8, 2020. This can be done up to eight months after the Vifo Act enters into force. The notification obligation does not apply retroactively. Incidentally, acquisition activities with respect to highly sensitive technologies, after the entry into force of the Vifo Act, cannot be tested retroactively.
Which companies are affected by the Vifo Act?
Four categories of companies can be distinguished to which the Vifo Act applies: (i) Dutch-based vital providers, (ii) companies active in the field of sensitive technology, (iii) companies active in the field of highly sensitive technology, and (iv) corporate campus operators.
What is meant by the "vital suppliers" category?
These are suppliers that play such an important role in society that their disappearance could potentially have major consequences. Think of suppliers active in the fields of: transport of heat, nuclear energy, air transport, management of corporate campuses, harbors, banking, infrastructure for the financial market, extractable energy or gas storage. The Minister of the Interior and Kingdom Relations may expand the category through an administrative decree (AMvB).
What is meant by the "sensitive technology" category?
These are products for which Dutch exports are subject to control. Think of certain chemicals and military goods. In reality, for the time being these are mainly products on the export control list from Regulation (EU) 2021/821. The Minister of Economic Affairs can expand the category by means of a administrative decree (AMvB).
What are so-called dual-use goods?
Dual-use goods are goods that can be used for military purposes. In addition, they can also be used for civilian purposes. Even if these goods are not produced for such military purposes, suppliers of dual-use goods may still be subject to a notification requirement under the Vifo Act.
What is highly sensitive technology?
These are technologies designated as highly sensitive in the Sensitive Technology Decree (Besluit sensitieve technologie) (such as technologies for nuclear goods, sensors and lasers, navigation and avionics). Through an administrative decree (AMvB), other technologies may possibly be designated as highly sensitive in the future.
What kind of activities are notifiable?
Certain acquisition activities. These are activities that lead to a change of control within the meaning of Article 26 and beyond of the Mededingingswet (Competition Act). Think of a merger, the establishment of a joint venture, the demerger of a company or the purchase of essential assets.
Do special rules apply to companies operating in the field of highly sensitive technology?
Yes. For companies active in the field of highly sensitive technology, acquiring or increasing "significant" influence is already subject to notification requirements. For example, the acquisition of 10% to 25% of the voting rights in a company in the Netherlands must already be reported.
Are all companies involved in acquisition activities subject to notification?
Yes. In the case of a notify obligation, both the acquirer and the target company/companies must report.
Where must the notification be made?
The notification must be made to the Bureau for Verification of Investments (BTI).
Is there a standstill obligation after notifying?
Yes. Until the investment test is completed and a positive decision is received, there is a prohibition on implementing acquisition activities. A breach of this obligation can be punished by a fine of up to 10% of the annual turnover of the company concerned.
What deadlines apply after submitting a notification?
The BTI decides on the notification within eight weeks of receipt. This period may be extended for a period of six months and possibly for a further period of up to three months. The review is suspended if the BTI requests additional information, until the information is submitted by companies involved.
What are the possible outcomes after making a notification to the BTI?
The BTI may consider that (a) no further investment test and review decision is required, the acquisition activity is then permitted or (b) that an investment test and review decision is necessary.
What if the BTI does not make a decision within the time limit?
In case the BTI does not make a decision within the given time limit that a review decision is required, then the activity is permitted by operation of law.
Can conditions be attached to the review decision?
Yes. The Minister of Economic Affairs may attach conditions to the review decision. Violating such conditions can be punished with a fine of up to 10% of the annual turnover of the violator.
What are the consequences of a negative review decision?
The acquisition activity is prohibited in this case. Acquisition activities already carried out are null and void. Acquisition activities already carried out in relation to listed companies are voidable. Failure to undo prohibited acquisition activities may be punishable by a fine of up to 10% of the offender's annual turnover.
