Much like the rest of the world in 2020, the Netherlands struggled to battle the Covid-19 pandemic. The country was one of the worst affected in Europe and suffered an unprecedented 8.5% drop in gross domestic product (GDP) in Q2. In line with global M&A market trends, large transactions were significantly fewer in number. Nonetheless, the Dutch market is generally very stable and it is likely that it will be able to bounce back in 2021. With a strong tech sector, the country is likely to see further investment from corporate and financial buyers in emerging technologies, such as the internet of things (IoT), 5G, data analytics and edge computing. This would follow on from 2019’s $8.4bn combination of InterXion, a European provider of carrier and cloud-neutral colocation data centre services, with Digital Realty, a US-based real estate investment trust (REIT).
The government has extended its support and recovery package for businesses and employees, which will now run well into 2021. As a result of the government support for businesses, insolvencies are down; insolvency lawyers suggest that zombie companies are being propped up by government aid, and are expecting a steep rise in insolvency instructions when the subsidies come to an end. On the restructuring side, the passing of the new Dutch scheme-of-arrangement legislation (WHOA) on 6 October 2020 enables all stakeholders to more easily navigate the vicissitudes of the pandemic and related circumstances. The scheme, which was developed long before the Covid-19 outbreak, allows for out-of-court debt restructuring.
Away from the pandemic, the Dutch nitrogen crisis, in which the government has attempted to curtail high nitrogen emissions to protect the environment, has caused major issues in the construction sector. Construction permits have been increasingly difficult to obtain and there have been delays to new highways, housing blocks, airports, wind farms and other infrastructure projects. With the country in the midst of a critically high housing shortage, these developments are less than ideal and have had knock-on effects for the real estate sector. The nitrogen emissions rules are also affecting agriculture; farmers and construction workers, who feel that they have been unfairly targeted by government measures, have been protesting in The Hague.
The top-end Dutch firms remained stable this year, with full-service firms De Brauw Blackstone Westbroek, Loyens & Loeff, NautaDutilh and Stibbe continuing to flourish. Houthoff and Van Doorne are other names to note. The Hague-based Pels Rijcken & Droogleever Fortuijn NV is still the ‘go-to’ firm for government work. The Netherlands' longstanding international players continue to have a strong presence in the market, with Clifford Chance, Allen & Overy LLP, Freshfields Bruckhaus Deringer, Norton Rose Fulbright and Dentons being particularly noteworthy. Taylor Wessing continues to grow its presence in the country after setting up shop in 2015. Greenberg Traurig LLP also continues to make inroads and has recently bolstered its presence with the hire of a team of five real estate lawyers from NautaDutilh; this follows on from the firm's hire in 2019 of a top-tier IT team from Allen & Overy LLP.