Current Month (December 2025)
Dutch Act on the Abolition of Pledge Prohibitions Entered into Force
By Martijn B. Koot and Sandy van der Schaaf, Heussen
After a lengthy legislative process that began in 2020, the Dutch Act on the Abolition of Pledge Prohibitions (Wet opheffing verpandingsverboden) (the “Act”) entered into force on July 1, 2025. The Act brings an end to contractual provisions that exclude the assignment or pledge of professional and commercial receivables.
The Act applies to:
- new agreements and general terms and conditions as of July 1, 2025; and
- existing contracts and general terms and conditions as of October 1, 2025, following a three-month transitional period.
Before July 1, 2025, the assignability or pledgeability of all receivables could be excluded or restricted through specific contractual wording. The Act now prohibits contractual clauses that exclude or limit the assignment or pledge of receivables governed by Dutch Law (geldvorderingen op naam) arising from professional or commercial activities (“commercial monetary claims” or “trade receivables”).
This definition is broad in scope and is intended to cover all receivables acquired in a professional or business context, not only claims arising from contracts between entrepreneurs. The main purpose of the reform is to enable these receivables to be used more widely as collateral, thereby improving access to finance, particularly for small and medium-sized enterprises (“SMEs”).
Under the Act, contractual provisions that exclude or restrict the assignment or pledge of commercial monetary claims, for example through a consent requirement or a penalty clause, are null and void, except where they fall within specific statutory exceptions. These exceptions include:
- current and savings accounts;
- syndicated loans; and
- claims on or from clearing institutions.
In these cases, parties remain free to include restrictions on assignment or pledge of commercial monetary receivables.
To avoid uncertainty for debtors regarding to whom payment must be made to validly discharge their obligations, the Act provides that a debtor must be notified in writing of any assignment or pledge of receivables. Until the debtor receives such notice, it may validly discharge its payment obligation by paying the original creditor.
The Act is expected to broaden financing opportunities, particularly for SMEs, by making it easier to use commercial monetary receivables as collateral. The increased flexibility is anticipated to strengthen access to external financing across the market.
