TerraLex Guide to Foreign Direct Investment - NEW

In the Netherlands, Foreign Direct Investment (FDI) is regulated at the national and EU levels.

EU Foreign Direct Investment Screening Regulation The EU Foreign Direct Investment Screening Regulation currently provides a cooperation framework between Member States and the European Commission for assessing foreign investments that may pose security or public order risks. It does not impose minimum sectoral requirements on national regimes of Member States. In January 2025, the European Commission proposed a new regulation that would require Member States to include at least the following sectors in their screening regimes:

• Critical technologies (including e.g. advanced semiconductor technologies, AI technologies, biotechnologies, and advanced materials, manufacturing and recycling technologies).
• Listed medicines that are considered innovative or critical for human use (including e.g. certain vaccines).
• Critical entities and activities within the EU's financial system (including e.g. payment systems and institutions, operators of a multilateral or organised trading facility, and other large institutions).

This could affect the scope of the existing Dutch national investment screening regulations.

National Investment Screening Regulations The current Dutch framework consists of a general and several parallel sector-specific investment screening regimes, including:

• Vifo Act (Wet veiligheidstoets investeringen, fusies en overnames)
• Telecommunications Act (Telecommunicatiewet)
• Energy Act (previously the Gas Act (Gaswet) and Electricity Act (Elektriciteitswet))

On 1 June 2023, the Vifo Act came into effect, establishing a general FDI screening framework that complemented the already existing sector-specific regimes. The Vifo Act requires screening of investments, mergers, and acquisitions involving companies in the Netherlands that operate in vital processes, engage in (highly) sensitive technologies, or manage business campuses, where such activities could pose a risk to national security.

On 1 July 2024, members of the Dutch parliament proposed to assess the ‘Defence Resilience and Safety Related Sector Act’ (Wet weerbaarheid defensie en veiligheid gerelateerde industrie), intended to strengthen national security by increasing government oversight of companies in the defence and security-related industries. This may lead to an extension of the scope of Dutch national investment screening regulations in the future.

On 1 January 2026, the Energy Act replaced the Gas Act and the Electricity Act. We will therefore only discuss the Energy Act in this guide.

The Dutch Investment Screening Bureau (Bureau Toetsing Investeringen) (BTI), part of the Dutch Ministry of Economic Affairs and Climate, is responsible for FDI screening in the Netherlands. Any proposed acquisition subject to FDI regimes must be reported to the BTI.

It is possible to approach and consult the BTI informally before submitting a formal application to seek guidance on whether a filing is required. The BTI can give an informal opinion. The BTI also published guidance documents that can help assess whether a filing is required.

Vifo Act The Vifo Act is triggered when an investment results in a change of control (or significant influence) of a target company based in the Netherlands that is:

• A ‘vital provider’

Explanation: Examples of vital providers include heating network operators, activities in relation to storage, production and processing of nuclear energy, energy extraction, activities in relation to gas exploration, transport and storage, air transport (including Schiphol Airport, ground-handling services and KLM), activities related to the Rotterdam Port, banks with registered offices in the Netherlands, and certain financial market infrastructure providers, such as trading platforms. Additional vital processes can be added through ministerial decree.

• Active in the field of ‘(highly) sensitive technologies’

Explanation: Sensitive technology includes military and dual-use technologies as defined in the EU Dual-Use Regulation (EU 2021/821). The list of sensitive technologies is expanded through Ministerial Decree and also includes quantum mechanics, semi-conductor technologies, high-assurance technologies and photonics. Proposed to be but currently not included are biotechnology, artificial intelligence, advanced materials and nanotechnology, sensor- and navigation technology, and nuclear technology with medical applications. A consultation on the scope of the list of sensitive technologies is currently pending.

• A ‘manager or operator of a business campus’

Explanation: A business campus constitutes an area on which different companies are active and where there is a public-private partnership for working on technologies and applications that are of economic and strategic importance to the Netherlands, such as the High-Tech Campus Eindhoven.

The definition of change of control is laid out in the Dutch Competition Act, from which follows that control means the possibility of exercising decisive influence on the activities a company.

The Vifo Act does not apply if the Dutch state, provinces, municipalities or other public bodies are the acquirer or if a sector-specific national security test applies to the activities to be acquired (see below).

Telecommunications Act The Telecommunications Act's investment screening regime is triggered when an acquisition of predominant control in a telecom company results in significant influence in the telecom sector. It concerns companies that:

• Provide internet or phone services to over 100,000 end-users in the Netherlands (with user numbers calculated per type of connection).
• Operate an electronic communications network used to deliver these services to over 100,000 end-users.
• Operate an internet exchange with more than 300 connected autonomous systems.
• Provide data-centre services with over 50 MW of power capacity.
• Provide hosting for more than 400,000 .nl domain names.
• Offer a qualified trust service.
• Supply telecom, data-center, hosting, or trust services to Dutch national security or defence agencies.
• Or, if none of the individual thresholds are met, provides a combination of such services whose calculated values add up to 1 or more (based on ratios for end-users, AS numbers, data-centre consumption, and hosted domains).

Predominant control is acquired when the investor:

• directly of indirectly, individually or jointly with others, holds at least 30% of the voting rights at the company’s general meeting
• has the right to appoint or dismiss more than half of the members of the company’s managing or supervisory board
• holds one or more shares granting special rights of statutory control
• holds a branch office that is a telecommunications operator
• is fully liable partner in a
• is the owner of a sole proprietorship

Energy Act Under the Energy Act, any change of control involving (i) a production facility with a total nominal electrical capacity of more than 100 MW, or a company that manages one or more such production facilities, or (ii) a (part of a) Liquified Natural Gas (LNG) facility or a company that owns an LNG triggers the investment screening regime under the Energy Act and must be notified to the BTI.

The definition of change of control is laid out in the Dutch Competition Act, from which follows that control means the possibility of exercising decisive influence on the activities a company.

Vifo Act

The review will consider whether a merger, acquisition, or investment poses a (national) security risk. This depends on several factors, such as the investor, the sector, the part of the business process involved, and the countries of origin of the ultimate shareholders. Three examples of potential security risks are:

• Disruption of vital infrastructure: Processes such as energy supply and telecommunications are critical to society. Any outage or disruption can cause severe societal disruption. If a malicious party gains control over a company involved in vital processes, this may create a national security risk.
• Leakage of advanced knowledge or technology: Through mergers, acquisitions, or investments, knowledge and technology can fall into the hands of malicious actors. For example, a foreign investor could gain control of a company developing advanced military technology, which could then be misused against Dutch security interests. Intellectual property loss can harm both the company and the Dutch economy. Non-military technologies like biotechnology or semiconductors are also critical.
• Undesirable strategic dependencies: Situations where the Netherlands could be politically pressured by another country, potentially threatening democratic order or vital processes.

Telecommunications Act

The review will consider whether circumstances exist that could allow the acquirer or holder to pose a threat to the public interest. These circumstances relate to preventing situations in which the Dutch government could be pressured by an undesirable person threatening to misuse or disrupt telecommunications companies under its control. Statutory grounds for the review include:

• the identity of the acquirer or holder, more specifically whether they are designated as an undesirable person, whether there is evidence or suspicion of intent to influence a telecom company for misuse or deliberate outage, whether they have close ties to a state, entity, or person suspected of such intent, and whether their identity can be verified.
• Track record of the acquirer or holder
• Level of cooperation with the review

Examples of risks that can be identified during the review of the BTI in the telecommunications sector include the risk that a party may (intentionally) disrupt the company’s vital functions or threaten to do so, or the risk that a party may compromise the confidentiality or continuity of specific communication services.

Energy Act

The review will consider factors such as the company's financial reliability, its governance and management structure, and the degree of transparency in its operations. It will also assess the track record of the parties in ensuring safety and their technical expertise for reliably conducting the relevant activities.

Filings are mandatory and must be made pre-closing.

Vifo Act

No strict mandated timeline for filing. Filing must be made before the completion of the transaction.

See answers below regarding stand-still obligation.

Telecommunications Act

The Telecommunications Act requires that a notification be made at least eight weeks prior to closing.

Energy Act

Timeline for filing is no later than four months before the date of the intended change of control.

No, there are no filing fees for submissions under the Vifo Act, Telecommunications Act and Energy Act.

Vifo Act (general FDI)

See filing form for Vifo Act here. Filings must include the following information:

• information about the notifying parties and their representatives;
• information about the proposed acquisition or change of control, or the acquisition or increase of significant influence;
• information about the ownership structure and relationships of the notifying parties, including information on the acquisition and holding of control or significant influence, and about the ultimate acquirer and its participation in the capital;
• information about the products and services supplied by the notifying parties;
• information about the country where the acquirer’s principal place of management is located;
• an overview of the legal entities, legal form, and registered office of the acquirer’s legal entities; and
• other information necessary for the assessment.

Telecommunications Act

See filing form for Telecommunications Act here. Filings must include the following information:

• information on the parties (i.e. investor and target) and their representatives;
• a description of the business activities of the parties, including information regarding its telecommunications services and networks and the jurisdiction of the activities;
• information on the proposed acquisition of control, including the participating interests of the shareholders, the control structure after the acquisition, the transaction value, the financial institutions involved in the transaction and the economic motives of the transactions; and
• all relevant facts and circumstances that may have a role in the assessment of the transactions, such as ties with foreign governments, financial, fiscal and criminal information as well as information of other authorities (including foreign) on the investor and target.

Energy Act

See filing forms here for Energy Act here. Filings must include the following information:

• information on parties involved (Trade name, legal form, registered office, Chamber of Commerce registration, address details, and contact persons of the parties involved,
• information on installations involved (the production installation for electricity, the company managing the installation, LNG installation, or LNG company affected by the change)
• information on intended change in control (current structure of control and proposed change in control)
• information on financial position (most recent annual report and financial statements of the acquiring party, statement from a bank or accountant involved in the change of control, intended method of financing and its current status, key figures regarding the acquiring party’s creditworthiness;
• the strategy intentions and past performance (intentions regarding the change in control and underlying strategy of the acquiring party, past performance of the acquiring party in the electricity production or LNG sector).

Vifo Act (general FDI)

Both the investor and the target company share responsibility for notifying the transaction.

Telecommunications Act

Only the investor party is responsible for notifying the transaction.

Energy Act

Both the investor and the target company share responsibility for notifying the transaction.

Vifo Act

Non-compliance with the filing obligation can result in the following enforcement risks:

• Administrative enforcement BTI: If the transaction has taken place before the BTI has given a decision or cleared the transaction, a fine may be imposed of up to € 900,000 or 10% of the turnover of the companies involved.

If a transaction has not been filed at all, the BTI may order a re-filing within three months of becoming aware of the unfiled transaction. In addition, acquired voting rights may be suspended.

If a transaction is executed despite a prohibition, the transaction is void and can be nulled.

• Criminal enforcement, criminal fines can be imposed based on Article 1(1) of the Economic Offences Act (Dutch: Wet Economische Delicten), and additionally a (temporary) shutting down of the company/its activities. Although in principle criminal enforcement is less common in practice, it may be preferred when it is anticipated that administrative fines will not have the desired impact and effect because e.g. a company is a state actor or has sufficient financial resources.

• Enforcement of private persons: The Vifo Act itself does not address powers for administrative enforcement authorities to fine private persons. However, with respect to Economic Offences Act infringements, we have seen that there is a possibility that private persons, like the director or manager responsible for the conduct, were fined or affected by civil follow-up claims for criminal conduct.

Telecommunications Act

The BTI (the Minister of Economic Affairs and Climate) may impose a fine of up to EUR 900,000 for failing to notify the transaction or for late notification.

Energy Act

The BTI (the Minister of Economic Affairs and Climate) can impose administrative fines equal to a maximum of the sixth category of the Dutch Criminal Code (see here), amount to date to a maximum of EUR 1,030,000, or if more, 10% of the turnover of the infringer.

There is also a risk that transactions that have not been filed can be annulled by a court ruling.

Vifo Act

A mandatory standstill period must be observed before a transaction can be completed. The proposed transaction must be suspended until the BTI issues its final decision. Failure to comply with the standstill provision may result in fines of up to € 900,000 or 10% of the turnover of the parties involved.

Telecommunications Act

No explicit standstill obligation applies. However, completing a transaction before a decision is issued carries the risk that the transaction may need to be reversed and that the deal may be undone.

Energy Act

No explicit standstill obligation applies. However, completing a transaction before a decision is issued carries the risk that the transaction may need to be reversed and that the deal may be undone.

The BTI has no formal power to review transactions that fall outside the scope of the FDI regimes.

Vifo Act

The BTI can take several types of decisions after a filing. BTI may determine that no further review is required, approve the transaction outright, or approve it subject to conditions aimed at mitigating national security risks. If concerns remain, BTI can require a more in-depth screening decision, which involves a deeper assessment of the investment. Ultimately, BTI also has the authority to prohibit the transaction entirely if it poses a threat to national security.

Telecommunications Act

Based on public safety, security of supply, or continuity of service, an investment may be prohibited or prohibited subject to suspensive conditions, or approved subject to conditions.

Energy Act

Based on public safety, security of supply, or continuity of service, an investment may be prohibited or approved subject to conditions.

Vifo Act

The BTI can impose a wide range of conditions after an in-depth review and evaluation decision (Dutch: toetsingsbesluit). This includes conditions regarding information, security and compliance measures, governance measures, corporate structural measures, and restrictions on certain activities.

Examples of measures include, amongst others, the setting up of a separate supervisory board (Raad van Commissarissen) for a Dutch subsidiary, requiring the acquirer to place specific business units related to vital processes or sensitive government services into a separate Dutch subsidiary, excluding certain assets, business units, or subsidiaries from the transaction, terminating of stock-exchange trading of listed shares subject to prior ministerial approval, prohibiting specific forms of service provision or goods sales from the Dutch operation to certain entities or countries, and obligating the investor to deposit certain technology, source code, genetic code, or knowledge with the Dutch State or a trusted third party, with emergency access for non-commercial public-interest purposes.

A complete list of conditions that may be imposed is found in Articles 23-24 of the Vifo Act.

Telecommunications Act

Based on public safety, security of supply, or continuity of service, an investment may be prohibited or prohibited under suspensive conditions (Dutch: opschortende voorwaarden), or impose conditions.

Energy Act

Based on public safety, security of supply, or continuity of service, an investment may be prohibited or subject to conditions.

Companies in principle can propose remedies to address BTI's concerns. These can be set as conditions in the BTI's clearance decision.

Investors (and the companies involved) have the right to appeal a screening decision. Such appeals are administrative by nature and subject to the Dutch General Administrative Law Act.

Vifo Act

Decisions can be appealed to the BTI (Ministry of Economic Affairs and Climate) through administrative objection, then appealed to the Rotterdam District Court and subsequently further appealed to the Trade and Industry Appeals Tribunal (CBb).

Energy Act and Telecommunications Act

Prohibition decisions can be appealed through administrative objection at the BTI (Ministry of Economic Affairs and Climate), then appealed to the district court of Rotterdam and subsequently further appealed to the CBb.

In both the Telecom sector and Energy sector, if the BTI intends to decide that an envisaged investment/transaction is prohibited, the companies involved will be invited to provide their views (zienswijzen) on the proposed decision.

Vifo Act

The review process under the Vifo Act is two-phased:

1. Phase 1 (screening phase) starts upon submission of the filing. BTI should decide within 8 weeks, with a possibility of an extension of up to 6 months. Phase 1 ends with either a decision that confirmation that no in-depth review is needed or a requirement for an in-depth evaluation decision (Dutch: toetsingsbesluit).
2. Phase 2 (in-depth review phase) begins when the investor requests an in-depth evaluation decision. BTI has another 8 weeks, extendable by up to 6 months (time used in Phase I is deducted; total extension cannot exceed 6 months).

A ‘stop-the-clock’ applies if BTI requests additional information.

An additional 3-month extension may apply if the case must be shared with the European Commission and other Member States under the EU FDI Regulation.

Telecommunications Act

The BTI must decide within 8 weeks of receiving the filing whether to approve, prohibit, or refer the transaction for in-depth review. If no decision is made within this period, approval is deemed granted. If further investigation is required, the deadline may be extended by up to 6 months.

A ‘stop-the-clock’ applies if BTI requests additional information.

Energy Act

There is no statutory deadline for BTI to issue a decision in the Energy Act. Timelines and procedures for decisins from the BTI under the Energy Act can be further set by Ministerial Decree.

Notifications and decisions are not made public. If the Minister decides to impose a prohibition under the Telecommunications Act, this decision will be disclosed.

The European Commission and Member States receive the following information after a notification:

• The ownership structure of the foreign investor and the company being invested in
• The approximate value of the investment
• The products, services, and business activities of both the foreign investor and the target company
• The Member States where the foreign investor and the target company conduct business activities
• Details of the investment’s financing and its source, based on the best available information
• The date or planned date of completion of the investment

Starting in 2024, the BTI publishes an annual report on BTI screenings. These reports include information on the sectors of the target companies, the countries of the acquirers, the screening outcome. These reports do not contain individually identifiable information.

Multiple investment controls or similar screening regimes can apply. Most prominent other regimes to be considered include (but are not limited to):

Merger Control Regimes

• Merger Control Regimes at the EU and Dutch national level apply to transactions that meet certain turnover thresholds. It is important to note that the Dutch competition authority (ACM) has published a draft bill that would give the ACM the power to also review transactions that currently fall below the notification thresholds. This "call-in power" would allow the ACM to investigate potentially anti-competitive deals that it would not otherwise have jurisdiction over and to block them if they are found to significantly impede effective competition, even post-completion of a transaction. This draft bill is still in the legislative process.

EU Foreign Subsidies Regulation (FSR)

• The EU Foreign Subsidies Regulation (FSR) applies directly in all EU Member States, including the Netherlands. It affects investments, mergers & acquisitions, joint ventures, and public procurement whenever a company involved has received financial contributions from non-EU countries that meet notification thresholds (the target or joint venture has EU turnover of at least €500 million, and the parties have received €50 million or more in foreign financial contributions in the past 3 years.