Recent news and developments: The Netherlands Supreme Court has ruled that parties in international transactions can effectively determine which law will be applicable to the assignment of personal claims, such as accounts receivable

United Kingdom
(a contribution from our associate Dutch firm - Derks, Star Busmann, Hanotiau)

The Netherlands Supreme Court decided earlier this year on a highly debated issue in Dutch private international law Brandsma v Hansa Chemie AG.

The Court ruled that with regard to the assignment of personal claims (such as accounts receivable), parties in international transactions can effectively determine which law will be applicable to the assignment of such claims. This law can be the law which governs the assignment agreement (or security interest agreement) itself and it can be chosen by the parties. The chosen law is also applicable to the assignment of claims itself and this choice is acknowledged and recognised by Dutch private international law.

For foreign banks and other financial institutions this court decision opens the possibility of realising an assignment or pledge of claims against Dutch debtors (e.g. by means of creating a security interest or for securitisation purposes), pursuant to a foreign law system, thereby circumventing certain restrictions and limitations of Dutch law on this matter.