Zorgplicht Legal Opinion

The law applies to all businesses that sell or provide goods or services to Dutch consumers, regardless of where the business is located or registered, with no exception for legal form or size. The law defines consumers as natural or legal persons who use, consume or purchase goods or services. A coalition of Dutch companies, some of which proclaim their brands are already “child labor free,” expressed support for the legislation in 2017, noting that all products and services on the Dutch market should meet a 100% child labor-free standard. However, case law provides that a literal interpretation of the credit agreement is the starting point when the professional parties have negotiated the credit documentation and have been assisted by expert (legal) advisors.3 This means that the terms of complex financing agreements are usually interpreted literally in complete and negotiated documentation. For this reason, parties can usually rely on the literal meaning of the terms. Thus, if a bank terminates a credit facility on the basis of its contractual rights, it is difficult for a borrower to argue that the bank acted inappropriately. Companies that fail to make a declaration will be fined, although the fine of just €4,100 is largely symbolic. The fine may be increased in the event of new complaints and if a company does not comply with the following legally binding instructions and enforcement conditions of the supervisory authorities. The situation is different if a bank has entered into a contract with a non-professional party or a party who has concluded a contract without legal advice.

The Haviltex criterion applies to the interpretation of such contracts. A court could then consider a wide range of relevant circumstances in preparing the documentation, and parties may rely less on the literal wording of these terms. Such an interpretation is sometimes adopted even when professional parties have concluded contracts with the assistance of their legal advisers. If, as a customer, stakeholder or third party, you have suffered a complaint or damage due to an accounting error, please contact us for a non-binding discussion. Zorgplicht Advocaten`s lawyers have years of experience advising on the due diligence of an accountant or accountant. Our lawyers also have experience in conducting a complaint procedure with Accountantskamer or in conducting proceedings before the civil court. In our view, the courts may take these factors into account even if the loan agreement was concluded between a bank and another professional party, in particular if a standardised loan agreement was used, such as contracts based on the GTC. In situations where the parties use negotiated contractual agreements entered into with professional legal advice, these factors are less likely to be relevant. A bank enjoys a certain position of power and for this reason it is assumed that a bank is attentive to the interests of its customers, who depend entirely on the bank for their funding. A bank therefore has a special duty of care (zorgpflicht). The bank must act in accordance with this special duty of care if it decides to terminate a credit relationship with a customer (opzeggen). With the unanimous adoption of the UN Guiding Principles by the UN Human Rights Council in 2011, human rights due diligence was established as a global expectation of business.

In recent years, several international and European institutions, as well as national parliaments, have called for a business and human rights framework that enshrines human rights due diligence in law. While the European Commission has so far largely failed to respond to the growing number of calls for improved legal standards on accountability for human rights violations and environmental damage caused by European companies, there are several legislative initiatives at national level. The new Dutch law is therefore part of a broader trend to regulate human rights due diligence, either through transparency requirements or due diligence obligations. If regulators determine that the company has not conducted due diligence in accordance with the law, they will issue legally binding instructions to the company and a time frame for execution.