Abolition of Pledge Prohibitions: New Law in Force

The new law applies to new agreements as of 1 July 2025 and to existing agreements as of 1 October 2025, following a three-month transitional period. As of the respective dates, previously valid clauses restricting the transfer or pledge of Dutch law governed receivables (geldvorderingen op naam) arising from the exercise of a profession or trade are null and void, except if they fall within the statutory exceptions (e.g. syndicated loans, current and savings accounts and claims on or from clearing institutions). 

The Dutch Law on the Abolition of Pledge Prohibitions

New Section 3:83 DCC 

Section 3:83 paragraph 2 of the Dutch Civil Code ("DCC") provides that the transfer or pledge of receivables may be excluded by agreement between the creditor and the debtor. The new law on the Abolition of Pledge Prohibitions introduces a significant limitation to this principle by adding a new paragraph 3 to Section 3:83 DCC. 

The new Section 3:83(3) DCC states that excluding the possibility to transfer or pledge Dutch law governed receivables (geldvorderingen op naam) arising from the exercise of a profession or trade is not possible and that any provision agreed between the creditor and debtor of such receivables, which has the aim to exclude, in whole or in part, the capability of any party to transfer or pledge, or to prohibit the transfer or pledge of, such receivables is null and void. 

While the new legislation maintains the general possibility to contractually exclude the transfer or pledge of claims, this right is now limited for Dutch law governed receivables arising from the exercise of a profession or trade. In practice, contracts often contain not only explicit prohibitions on transfer or pledge, but also indirect restrictions, such as penalty clauses or conditions attached to a transfer or pledge. Where such clauses aim to exclude the capability of any party to transfer or pledge any Dutch law governed receivables, these also fall within the scope of the new regime and are null and void. However, negative pledge clauses and pari passu clauses that have been agreed between the creditor and a third party are not affected. 

The phrase "arising from the exercise of a profession or trade" is interpreted to cover all receivables obtained in a professional or business context. This does not mean that both parties must be acting in a professional capacity. For example, if a company acquires a receivable against a private individual in the course of its business activities, that receivable still falls within the scope of the new regime. Only receivables acquired by individuals acting in a purely private capacity are excluded, meaning clauses restricting the transfer or pledge of such receivables remain valid. 

The regime of Section 3:83 paragraph 2 DCC continues to apply to claims other than Dutch law governed receivables arising from the exercise of a profession or trade. This includes, for example, claims for the performance of obligations other than payment of a sum of money. The rationale is that in such cases, the identity of the debtor may be essential to the creditor and these claims are less suitable as security for credit. The new legislative provisions apply exclusively to the transfer and pledge of Dutch law governed receivables, meaning that the exclusion of other types of dispositions, such as the establishment of a usufruct, remains permissible under Dutch law. 

Statutory Exceptions (Section 3:83(4) DCC)

In addition to the general limitations mentioned above, the new paragraph 4 of Section 3:83 DCC provides four statutory exceptions to the prohibition on excluding the transfer or pledge of receivables. In these cases, parties remain free to agree a restriction on the transfer or pledge of receivables. These statutory exceptions are as follows: 

1. Receivables arising from a current or savings account; 

2. Receivables arising under a credit or loan agreement involving multiple lenders;

3. Receivables from or on a clearing institution as referred to in Section 1:1 of the Dutch Financial Supervision Act, a central counterparty, a settlement institution, a clearing house or a central bank as referred to in Section 212a (c), (d), (e) and (g) of the Dutch Bankruptcy Act; and

4. Receivables which, pursuant to an agreement as referred to in Section 34, paragraph 3, 35, paragraph 5, or 35a, paragraph 4, of the Collection Act 1990, will be paid into a bank account held for the payment of income tax, sales tax and social insurance contributions.

The rationale behind the exceptions for receivables arising from a current or savings account and receivables by or from a clearing institution lies in the importance of maintaining the integrity of payment and securities settlement systems. Allowing the unrestricted transfer or pledging of such receivables could create uncertainty among banks as to whom the account balance should be paid. In addition, this exemption helps to ensure that banks' account records continue to accurately reflect their actual payment obligations. Similarly, clearing institutions play a critical role in the proper functioning of financial markets, and contractual restrictions on transfer or pledge are considered essential to preserving transaction certainty and operational continuity. 

The exception for loans with multiple lenders (e.g. syndicated loans) reflects established international lending practice, particularly under standard documentation issued by the Loan Market Association ("LMA"). Such documentation commonly includes provisions restricting the transfer or pledge of receivables by lenders without the borrower’s consent. In order to ensure that Dutch law remains aligned with international market standards, these arrangements continue to be permitted under the new law. It is important to note that this exception applies exclusively to loans with multiple lenders (e.g. syndicated loans), and not to bilateral loans (i.e. loans involving a single lender). However, where there is a clear intention that additional lenders accede to the loan at a later stage, the exception may still apply. 

Requirement to notify in writing

For debtors, the transfer or pledge of receivables may give rise to concerns, as it can create uncertainty regarding to whom they must make payment in order to validly discharge their obligation. To address this legitimate interest, the new regime includes a requirement that the debtor is notified in writing in Section 3:94(5) DCC (for transfers) and Section 3:239(5) DCC (for pledges). Until such written notice is given, the debtor may continue to validly discharge its payment obligation by paying the original creditor.

For receivables that fall under the exception of Section 3:83(4) DCC the requirement to provide written notification does not apply. According to the legislator, the fact that parties can exclude the possibility to transfer or pledge the receivables makes such a requirement unnecessary. However, by operation of Section 3:98 DCC, the requirement to provide written notification remains applicable to the creation of a usufruct over Dutch law governed receivables arising from the exercise of a profession or trade.

Broad scope of Section 3:83(3) DCC

The new regime has a general application and is not limited to SMEs. While it aims to offer SMEs greater flexibility to use receivables as collateral, it also introduces a degree of legal uncertainty. Section 3:83(3) DCC provides that not only clauses explicitly prohibit the transfer or pledge of Dutch law governed receivables arising from the exercise of a profession or trade are null and void, but also those that aim to restrict or prevent such actions. 

The legislative history confirms that the new regime is intentionally broad. Even indirect restrictions, such as penalty clauses, consent requirements or conditions attached to the transfer, are null and void if they serve to discourage or obstruct a transfer or pledge. However, the legislative history provides little guidance on how to determine whether a clause aims to restrict such rights, particularly where contractual provisions serve legitimate commercial purposes, e.g. for coordination, transparency or risk control. Based on the legislative history we expect Dutch courts to apply a strict interpretation, focussing on the practical effect of a clause rather than its formal wording. This assessment will likely be made on a case-by-case basis, taking into account the specific circumstances. Pending further judicial interpretation, parties are advised to carefully assess both the wording and the intent of relevant clauses in light of the new regime.