Act on the Management and Supervision of Legal Entities Act enters into force 1 July 2021

The Management and Supervision of Legal Entities Act (Wet Bestuur en Toezicht Rechtspersonen, hereinafter referred to as the “Wbtr”) aims to improve the quality of management and supervision of various Dutch legal entities, such as associations, cooperatives and foundations. A number of articles of law in the field of management and supervision, which now only apply to Dutch BVs and Dutch NVs, will also become applicable to these legal entities. Furthermore, the Wbtr contains new rules regarding the liability of directors and supervisory directors in the event of improper performance of their duties.

One of the reasons for the Wbtr is a series of governance incidents in the semi-public sector, including the energy sector. The Wbtr is the legislator’s cross-sector response to this.

With the Wbtr, the duties of managing directors and supervisory directors of associations, cooperatives and foundations and the related liability regime are laid down in law and tightened up in certain respects. In addition, the Wbtr aims to unify the regulations for directors of legal entities.The Wbtr will enter into force on 1 July 2021. The Act will have immediate effect, on the understanding that for some subjects a transitional arrangement will be included to accommodate existing practice. It is therefore wise for managing directors and supervisory directors to prepare themselves well and seek advice in good time before 1 July 2021. It can then be considered whether an amendment of the articles of association or a possible amendment of regulations and internal procedures are necessary or desirable now or in due course.