House of Representatives adopts bill on government control of telecom ownership

12 May 2020

The Netherlands’ House of Representatives has adopted a bill amending telecoms legislation to allow the government to block ‘undesirable’ investors from acquiring stakes in Dutch operators. Following the unanimous vote on 7 May, the Senate Committee for Economic Affairs will discuss the bill – ‘Amendments to the Telecommunications Act with regard to Undesirable Control in Telecommunications Parties’ (Undesirable Controls Telecommunications Act, 35153) – today (12 May 2020).

The Dutch Senate website summarises the amendments thus: ‘This bill provides for a new chapter (14a) in the Telecommunications Act. This chapter prevents a party acting on the basis of geopolitical motives from gaining control of the telecommunications infrastructure and services that can be abused. The Minister of Economic Affairs and Climate (EZK) is empowered to prohibit the acquisition or retention of predominant control in a telecommunications party if, in his opinion, obtaining or retaining such control threatens the public interest. In order to maintain an overview of relevant acquisitions in the telecommunications sector, a reporting obligation is provided. The person who intends to acquire predominant control in a telecommunications party must report this intention to the Minister of EZK if this control leads to relevant influence in the telecommunications sector. After receiving notification of an intended acquisition of predominant control, the minister will start an investigation. This investigation aims to determine whether there are grounds for a ban. In addition, the Minister of EZK will actively monitor the control relationships in the telecommunications sector.’

The bill was submitted to parliament back in March 2019 by State Secretary for EZK Mona Keijzer following original government proposals in April 2018 to enforce takeover controls applicable to fixed/mobile telephony, internet and data centre companies, citing national security interests. Once approved by the Senate, the amendments will enter into force at a date to be determined by Royal Decree.

Netherlands, Ministry of Economic Affairs & Climate Policy (MEACP)