Two weeks before the entire bill was to take effect for all legal entities, a royal decree was published postponing some provisions to give more clarity to NVs.

The first delayed set of provisions facilitates the one-tier board model for associations, cooperatives, mutual insurance companies and foundations. The provisions (and the necessary amendment to trade register regulations) will only enter inter into force when it is technically possible for these legal entities to indicate in the trade register whether a member of a one-tier board is an executive or a non-executive director. The absence of this legal basis does not change current practice where these legal entities may already have a one-tier board. The government has confirmed that this practice can continue unchanged.

The second delay concerns the requirement of NVs to include provisions in their articles of association on supervisory board vacancies and on supervisory directors being unable to act. Due to the lack of a transitional arrangement for NVs, the introduction of this requirement has also been postponed. In a bill currently being prepared, a transitional arrangement will be included requiring NVs to introduce the provisions when they next amend their articles of association. Meanwhile, if an NV is planning to amend its articles of association, we recommend anticipating the new requirements in that process.

The other provisions of the bill will enter into force on 1 July 2021 – see our previous article for further information.