The M&A landscape in the Netherlands is rapidly changing. The article discusses a variety of key decisions prospective buyers have to make, such as whether to purchase shares or assets of a company they are interested in, and how to finance such an acquisition.

Private M&A transactions are not governed by law however, parties can decide on their own legal structure within the contract of sale (the BV or the NV). However, the Dutch Civil Code (DCC) provides some standard terms for the purchase of assets, shares or business and defines the formalities that are required to be fulfilled when there is a public transaction involved.

An M&A public transaction may have to be approved by the Authority for Consumers and Markets (ACMM) or the European Commission. Certain types may also be subject to the Work Councils Act and competition regulations.

Shares and the business of the target company may be acquired in a variety of ways, including by offering new shares as a reward for the transaction. This type of merger is exempt from capital contribution tax in the Netherlands. Dividend withholding tax (WHT) However, it is typically due on profits that are distributed by the acquiring company.

The Netherlands permits the depreciation of goodwill for accounting purposes when an asset or business is acquired. This is possible over a period of 10 years, unless it is attributed as a group relief for CIT (clawbacks could apply). Service entities, such as branches with offices management strategies adapting to tech innovations in other countries, are subject to transfer pricing rules and may be eligible to receive assurance in advance of the tax implications of proposed related-party transactions, through the use of international rulings.