Operational Information

CFCL Investment regulation – The Netherlands

Netherlands CFCL

Reference

Service level
CFCL
Last Updated
14.10.2024

Regulatory structure

Please refer to the CBL Market infrastructure – the Netherlands for the complete information about the regulatory structure.

Holding restrictions

Disclaimer

The information contained in the Holding Restrictions is based on the legal opinion obtained by CBL that was issued on 2 October 2020. CFCL believes the information to be correct as of that date but disclaims any responsibility as to the accuracy and completeness of the information after that date. In the case of discrepancy between the information provided by CFCL and the local laws and regulations, the latter shall prevail. The Holding Restrictions do not constitute legal advice and Clients should seek advice from independent professional counsel.

Clients are responsible for ensuring compliance with the holding restrictions and agree to indemnify and hold harmless, CFCL, for any loss, expense, liability, damage, or claims, whether direct or indirect, against or incurred by CFCL arising out of or resulting from such non-compliance.

Holding restrictions – Register Market – The Netherlands

Restrictions on clients

CFCL Clients domiciled in the Netherlands are not allowed to hold the Netherlands investment funds on the Register market through CFCL. It is the responsibility of the Client to ensure compliance with the restriction.

Certain funds may impose other specific restrictions on investor domicile. Clients must refer to and abide by the restrictions (if any) contained in the fund prospectus before entering transactions.

Restrictions on settlement

There is no general restriction on settlement for The Netherlandsinvestment funds through CFCL. However, certain funds may impose specific settlement/transfer restrictions. Clients must refer to and abide by the restrictions (if any) contained in the fund prospectus before entering transactions.

Holding restrictions – CSD Market – The Netherlands

There are no holding restrictions for foreign investors in the Dutch market.

Significant shareholding reporting details

According to the amendments done to the Securities Giro Act and the Act on Financial Supervision, as soon as the substantial holding equals or exceeds 3% of the issued capital, the holder should report it to the Dutch regulator Autoriteit Financiële Markten (AFM).

Disclosure requirements

Introductory information and categories

This section provides general information about the disclosure requirements for fund securities holdings with which Clearstream Fund Centre must, according to the information available at the time of the present publication, comply with each of the domestic markets and fund markets covered by the Disclosure Requirements.

Fund securities that are held remotely are usually not disclosed by CFCL. A disclosure request received by CFCL regarding such a holding will be forwarded to the relevant client without assessing its validity and the CFCL Client shall handle the request on a voluntary basis.

Disclosure Requirements are only available for those countries where CFCL has a link to the respective domestic market or direct access to local domiciled funds that are held in Clearstream’s name on the register.

For fund securities holdings where CFCL has no such link or direct access to the register, clients must be aware that local laws might provide for mandatory disclosure. A disclosure request in this regard will be forwarded to clients without assessing its validity. Clients commit not to unreasonably withhold their consent to such a request and agree to indemnify CFCL for damages resulting directly from non-compliance with mandatory local disclosure requirements.

In most cases, the obligation to disclose is based on the domestic equivalent of a Companies Act, relevant investment funds act or anti-money laundering act and covers all security types.

In some instances, the obligation to disclose is based on stock exchange laws or regulations and only applies to listed domestic and foreign securities.

The Disclosure Requirements do not constitute legal advice and the Clients should seek independent professional advice in relation to fund securities deposited with CFCL, especially as, for those jurisdictions in which no disclosure obligation falls on CFCL, there may be separate disclosure requirements that apply directly to clients of CFCL, shareholders and beneficial owners.

Please note that CFCL is not always given comprehensive information or advised of changes affecting local disclosure requirements.

It remains the sole responsibility of the Client to ensure compliance with local disclosure requirements. If a requirement is not met, it is the Client who will be liable to any related penalty. Clients are therefore advised to seek independent legal advice on the existence and interpretation of local disclosure requirements.

In the case of a discrepancy between the general information contained in this document and the information provided by CFCL for a specific market, as applicable (irrespective of whether this information has been obtained from an agent of Clearstream Fund Centre, or, as the case may be, a foreign regulator of a branch of CFCL), the information provided by CFCL for the specific market as applicable, shall prevail.

N.B.: In all countries, if it is suspected that a disclosure obligation has been breached (for example, that a threshold of holdings under custody has been crossed without being reported), the regulators and the authorities may have the power to investigate. Moreover, in all countries, disclosure obligations might be triggered by enforceable judgements of the competent jurisdiction of the country in question.

Disclosure categories

Clearstream Fund Centre classifies disclosure scenarios according to the following market categories:

Category 1

Markets where disclosure by Clearstream as a custodian of Clearstream Fund Centre to issuers, investment fund managers and/or to regulators or market authorities is mandatory under applicable law;

Category 2

Markets where disclosure by Clearstream as a custodian of Clearstream Fund Centre of account holders to issuers, investment fund managers and/or foreign regulators or market authorities is a legal obligation in respect of securities in specific circumstances;

Category 3

Markets where there is no obligation for Clearstream as custodian of Clearstream Fund Centre to disclose account holders to issuers, investment fund managers and/or regulators, notwithstanding any disclosure requirement falling directly on clients of Clearstream Fund Centre, shareholders and/or beneficial owners or notwithstanding disclosure necessary to obey an enforceable judgement of the country in question.

Disclosure requirements – Register Market - The Netherlands

Disclosure Category: 2

Clearstream Fund Centre S.A. (“CFCL”) may be required under The Netherlands laws and regulations to disclose the identity and holdings of Clients and/or ultimate beneficial owners, upon request, in the case of holding investment funds in The Netherlands.

Consent

In order to comply with the applicable legislation, Clients with holdings in Dutch investment funds or entering into transactions in The Netherlands market must consent, and are hereby deemed to consent, to the required legal disclosure. Such consent includes the appointment of the requestor (for example, the Fund Manager, Transfer Agent, Regulator) as their attorney-in-fact, under power of attorney, to collect from CFCL the required information to be disclosed. Clients who do not grant such authority cannot hold such investment funds / financial instruments in their accounts with CFCL.

Disclosure Requirement

Clients are advised that the local laws and regulations may oblige CFCL to disclose the requested information on CFCL Clients and ultimate beneficial owners to the party that is entitled by law to receive such information.

Anti-Money Laundering and Terrorism Financing (Preventiona) Act (Wet ter voorkoming van witwassen en terrorismefinanciering)

Pursuant to Anti-Money Laundering and Terrorism Financing (Preventiona) Act (Wet ter voorkoming van witwassen en terrorismefinanciering), Dutch investment institutions are obligated to verify, on a continuous basis, the identity of the Client and ultimate beneficial owners of the fund units.

Background and legal basis

Legal basis for disclosure requirement may arise from the following:

  • Know Your Client (KYC) / Client Due Diligence (CDD) requirements;
  • Anti-Money Laundering and Terrorism Financing Act (Wet ter voorkoming van witwassen en terrorismefinanciering), FSA, Sanctions Act (Sanctiewet 1977).

Sanctions

The investment fund may refuse or even terminate the business relationship if CFCL Clients or ultimate beneficial owners fail to comply with the disclosure request.

The Client undertakes to hold CFCL harmless and to indemnify CFCL from any loss, claim, liability, or expense asserted against or imposed upon CFCL as a result of the Client failure, whatever the failure, to comply with these disclosure requests.

Disclosure requirements – CSD Market - The Netherlands

Disclosure Category 1

For holdings in Dutch listed companies and foreign companies with a listing on a Dutch stock market or multilateral trading facility ("Eligible Issuers"), Clearstream Fund Centre S.A. (“CFCL”) is under an obligation, under the Corporate Governance Act passed on 13 November 2012 by the upper house of the Dutch parliament with effect on 1 July 2013, to disclose the identity and holdings of the final beneficial owner.

Consent

In order to comply with the legislation as mentioned below, clients entering into transactions in the Dutch domestic market, consent and are hereby deemed to consent to disclosure at the request of and to the issuer or its agent bank, the names, emails and addresses of the final beneficial owners together with details of their positions as described below.

In addition, the aforesaid clients hereby give power of attorney to CFCL to provide to our depository, Clearstream Europe AG (CEU) as defined in the Market Link Guide or to our asset servicer BNP Paribas S.A. or, as the case may be, to the Eligible Issuer or its agent all the required information as per the Corporate Governance Act. This power of attorney is limited to the information which disclosure is mandatory under Dutch law and with respect to transactions on equities of Eligible Issuers ("Eligible Securities").

Disclosure requirements

There are, under Dutch law and the by-laws of Eligible Issuers, a number of ownership restrictions applicable to Eligible Securities.

Clients are advised that local laws and regulations (for example the Corporate Governance Act and the Act on the Identification of Investors) may require CFCL or its depository to disclose holding information and details of beneficial ownership with respect to the Eligible Securities held with CFCL's securities account.

Shareholders identification is mandatory as follows:

Identification request: The Corporate Governance Act entitled the Eligible Issuers to identify final beneficial having a capital interest of at least 0.5% of the outstanding share capital of the Eligible Issuers. In the run-up to its annual or extraordinary general meeting of shareholders, a company or its agent bank may request Euroclear Nederland and its member institutions and other intermediaries to provide the names, email and addresses of those investors from whom they administer the Eligible Securities (or depositary receipts for shares) together with details of their position. The Eligible Issuer or its agent bank can than proceed through the entire chain of custody until the last link, the investor, is identified.

Procedure: The company must submit the request within a 60 days period preceding the said general meeting of shareholders. The bank or other institutions to which the identification request is made must reply within three working days after the receipt of the request, and if possible supply the requested information. If no reply is forthcoming, the company may apply to a district court for an order directing compliance.

Mandatory fields of the information requested: (done by the Eligible Issuer or its agent):

  • ISIN identification of the underlying security;
  • Number of shares (greater than or equal to 0.5% of the outstanding share capital);
  • Name of the entity addressing the disclosure of information request (the issuer or issuer agent);
  • Date of disclosure;
  • Address of the entity addressing the disclosure of information request (email address);
  • Deadline of disclosure.

Details of the shareholder (final beneficial owner), delivery information (to be disclosed by the shareholder):

ISIN code of the underlying security;

  • Name;
  • Address;
  • Country; 
  • Final beneficial owner Y/N;
  • Email address of the shareholder;
  • Position on date of disclosure.

Directive (EU) 2017/828 of 17 May 2017 amending Directive 2007/36/EC with regard to the encouragement of long-term shareholder engagement (the second shareholder’s rights directive “SRD II”) has been transposed on 1 December 2019 (SDR II Law).

The implementation law in the Netherlands includes both the changes as described in the directive and the implementing regulation. The elements that are described in the directive have been in force since 1 December 2019 and the elements as described in the implementation regulation have been effective since 3 September 2020 as described in the implementation law, signed by the King and Government on 29 November 2019.

Duty of secrecy

The Eligible Issuer has an obligation to keep the information obtained secret and to handle it with due care. The company has an obligation under the Corporate Governance Act to also organise the information in such a way as to ensure that it is protected from loss and unlawful processing.

Background and legal basis

The rules for the disclosure of voting rights, capital, major holdings and capital interest in issuing institutions can be found in Section 5.3 of the Act on Financial Supervision (Wft) and in the Decree on the Disclosure of Major Holdings and Capital Interests in Issuing Institutions [Besluit melding zeggenschap en kapitaalbelang in uitgevende instellingen]. See: http://www.afm.nl/corporate/upl_documents/Act_on_Financial_Supervision_Wft_080307.pdf

The Netherlands Authority for the Financial Markets (AFM) plays a central role with regard to the implementation of the rules on the disclosure of major holdings and capital interests in issuing institutions: almost all tasks and powers of the Dutch Ministry of Finance under such rules have been delegated to the AFM (see www.afm.nl/corporate/default.ashx?DocumentId=9401).

Under Dutch law, the regulator could ask for disclosure to the issuer or to the beneficial owner but not - unless there is a specific request to disclose the identity of a shareholder as a result of an investigation (for example, regarding money laundering or terrorism) - to the custodian.

Obligation to report threshold crossings

Any acquisition of shares held in a public limited company (Naamloze Vernootschap) incorporated under Dutch law, whose shares (or certificates representing shares) have been admitted to the official listing of a stock exchange situated and operating within one of the member states of the EU (plus Iceland, Liechtenstein and Norway) that causes the holding to reach, exceed or fall below the 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75% and 95% thresholds must be disclosed.

The shareholders have to report directly to the Dutch regulator, the Authority for the Financial Markets via the following online notification:

https://www.loket.afm.nl/loket/en-GB/default2.aspx?

Part of the information provided to the AFM will be published in the Dutch press, for example, in Het Financieele Dagblad and in the Staatscourant.

Please refer to Disclosure Requirements – Netherlands for complete information on the disclosure requirements for the Netherlands.

Disclaimer

The information contained in the Disclosure Requirements is based on the legal opinion obtained by CBL acting as a sub-custodian for CFCL that was issued on 2 October 2020. CFCL believes the information to be correct as of that date but disclaims any responsibility as to the accuracy and completeness of the information after that date. In the case of discrepancy between the information provided by CFCL and the local laws and regulations, the latter shall prevail. The Disclosure Requirements do not constitute legal advice and Clients should seek advice from independent professional counsel.

Clients are responsible for ensuring compliance with the disclosure requirements and agree to indemnify and hold harmless, CFCL, for any loss, expense, liability, damage or claims, whether direct or indirect, against or incurred by CFCL arising out of or resulting from such non-compliance.