Inquiry proceedings and Wagevoe: what entrepreneurs need to know

The inquiry procedure at the Enterprise Chamber is one of the most powerful instruments in corporate law. This procedure is intended for situations where there is justified doubt about proper policy or proper conduct within a company. With the introduction of the Wagevoe, the rules surrounding this procedure have been clarified, providing entrepreneurs with more legal certainty.

What is the inquiry procedure?

The inquiry procedure is a special procedure at the Enterprise Chamber of the Amsterdam Court of Appeal. It offers shareholders and other entitled parties the opportunity to have an independent investigation instituted into the policy and conduct within a company. The primary purpose is not to separate parties, but to expose abuses and bring the company back into calmer waters.

Admissibility requirements after the Wagevoe

An important part of the Wagevoe is the clarification of the admissibility requirements. The law clarifies:

• ✓ who is authorized to submit an inquiry request;
• ✓ what capital or threshold requirements must be met;
• ✓ when the Enterprise Chamber will substantively handle a request.

This clarification prevents frivolous or strategically abused inquiry requests and contributes to a more efficient procedure.

Justified doubt about proper policy

For approval of an inquiry request, there must be concrete indications of possible mismanagement. Consider:

• ✓ structural violation of shareholder rights;
• ✓ conflicts of interest within the board;
• ✓ lack of transparency or information provision;
• ✓ ignoring legal or statutory rules.

Possible measures by the Enterprise Chamber

The Enterprise Chamber has far-reaching powers. It can, among other things:

• ✓ order an investigation;
• ✓ take immediate measures, such as suspension of directors;
• ✓ appoint temporary directors or supervisory board members;
• ✓ annul decisions.

These measures can have a major impact on the company and its management.

When is an inquiry procedure strategically wise?

An inquiry procedure is particularly suitable when the problem lies with policy, management or governance, and not so much with the personal relationships between shareholders. In other cases, the dispute resolution procedure may be a more effective route.