The inquiry procedure

Dutch company law provides for a special procedure to enable an investigation into the course of affairs and the policy of a company. Since 1971, the inquiry procedure has been incorporated into the Dutch Civil Code (BW).

The idea is that the Enterprise Chamber of the Amsterdam Court of Appeal can, at the request of a shareholder, a certificate holder, a relevant trade union or the company itself, order an investigation into the policy and course of affairs of the legal entity. This may concern a cooperative or a mutual insurance association, but in practice it almost always involves a private limited company (BV) or a public limited company (NV).

The investigation is carried out by one or more persons appointed for that purpose by the Enterprise Chamber. The Enterprise Chamber will only grant a request to order an investigation if there are ‘well-founded reasons to doubt proper policy’. In addition to the investigation, provisional measures may be requested that, in the interest of the company, can intervene deeply in the enterprise operated by the legal entity.

The inquiry procedure aims to clean up and restore sound relations by taking measures of a reorganisational nature within the undertaking of the legal entity concerned. Other objectives of the inquiry procedure are to achieve openness, to determine who is responsible for any mismanagement revealed and to create a preventive effect by making it possible to initiate an inquiry.