Restart (doorstart) after a Dutch bankruptcy: how does it work?

In a restart (doorstart), you buy the viable parts of a bankrupt business from the trustee in bankruptcy (curator) and continue them, while the debts stay behind in the bankrupt company. The main exception concerns staff: in some situations employees still transfer to you by operation of law, on their existing terms.

Dutch law does not use the term restart as a legal instrument. It is an asset purchase from the trustee, within the limits of the trustee’s powers under the Bankruptcy Act (Faillissementswet, Fw). Whether employees transfer depends on whether an economic entity that retains its identity is in reality transferred.

What exactly are you buying?

You buy assets and activities, not the company itself. Think of stock, machinery, fixtures and fittings, intellectual property such as the trade name, goodwill and the customer base, in so far as these are transferable and belong to the estate.

In principle you do not take on the debts. They remain in the bankrupt company and are paid from the proceeds of the estate in the statutory order of priority. In that respect an asset deal differs fundamentally from a share deal, in which the company’s past and contingent liabilities come with the shares.

Can a restart be a transfer of undertaking?

Yes, it can. Under Article 7:662 of the Dutch Civil Code (BW), a transfer of undertaking (overgang van onderneming) is the transfer, under an agreement, merger or demerger, of an economic entity that retains its identity. A part of a business can also qualify.

Whether a particular restart qualifies depends on the facts: whether the activities continue, whether customers and assets are taken over and whether most of the workforce in fact carries on working. That assessment directly determines whether employees transfer automatically, as explained below.

Can the trustee sell everything?

No. The trustee can only sell what belongs to the estate, and third-party rights must be respected. Under Article 57 Fw, holders of a right of pledge or mortgage may in principle enforce their rights as if there were no bankruptcy.

A sale by the trustee remains possible, but the secured creditor’s ranking in the proceeds must be respected. Whether an asset under retention of title falls outside the estate depends on the clause and the facts at the bankruptcy order, so check asset by asset.

Who decides on the restart?

The trustee decides, under the supervision of the supervisory judge (rechter-commissaris). The trustee administers and liquidates the estate (Article 68 Fw) and may sell assets, publicly or by private sale, with the supervisory judge’s authorisation (Articles 101 and 176 Fw).

The trustee need not accept the highest bid. It weighs proceeds, feasibility, certainty of payment and speed, so a well-funded bid without a financing condition often beats a higher bid with uncertain funding.

Why is there so much time pressure?

Because a bankrupt business loses value quickly. Staff leave and customers move to competitors, so restarts are usually completed within days rather than weeks.

Due diligence is hardly possible and the trustee gives no warranties: you buy the assets as they are.

What does the cooling-off period do?

The supervisory judge may order a cooling-off period (afkoelingsperiode) of up to two months, which can be extended once by a further two months (Article 63a Fw). During that period third parties may not take recourse against assets of the estate or reclaim assets in the bankrupt company’s possession without the judge’s authorisation.

This gives the trustee room to negotiate a restart. It is not a general freeze on all third-party rights: creditors of the estate are expressly excluded.

What happens to the employees?

In a bankruptcy, employees do not transfer automatically, because Article 7:666 BW excludes the transfer rules when the employer has been declared bankrupt and the business belongs to the estate. That exception has limits, and it is the point where a restart most often runs into legal trouble.

The main rule is that on a transfer of undertaking, the rights and obligations under the employment contracts pass to the acquirer by operation of law (Article 7:663 BW). The bankruptcy exception only comes into play once it is clear that there is a transfer of undertaking at all. The courts look at the facts, not at the label bankruptcy restart, and recent case law shows both outcomes.

In practice you cannot take for granted the freedom to pick and choose staff on which restarts are often built. A buyer who takes back almost the entire workforce on clearly worse terms, while the business in fact continues seamlessly, runs a real risk that a court finds that the employees transferred after all, with all their existing rights. The prohibitions on discrimination continue to apply in full when you select staff.

The trustee terminates the existing employment contracts with a notice period of no more than six weeks, with the supervisory judge’s authorisation. From the bankruptcy order onwards, wages and related contributions are debts of the estate (Article 40 Fw).

The employee’s side of the story, including the UWV wage guarantee scheme, the transition payment and the position of employees who are ill or pregnant, is set out in your Dutch employer is bankrupt: what happens to your job. Note the difference with the other insolvency route: in a suspension of payments (surseance van betaling) the Article 7:666 exception does not apply, and employees in principle transfer by operation of law.

Can you rely on a pre-pack?

Not with certainty. In the Netherlands a pre-pack currently has no statutory basis, and as a result the bankruptcy exception for employees does not apply to a restart prepared in that way.

In a pre-pack, a restart is prepared quietly before the bankruptcy order, under a prospective trustee and a prospective supervisory judge, so the business loses less value.

The Court of Justice of the EU set out the conditions for the insolvency exception to employee protection in Smallsteps (22 June 2017, C-126/16) and Heiploeg (28 April 2022, C-237/20). One of those conditions is that the procedure is governed by statutory or regulatory provisions. The Dutch Supreme Court (Hoge Raad) held in the Heiploeg case that the position of the prospective trustee and prospective supervisory judge is not regulated by statute, so that the pre-pack followed did not meet those conditions (HR 6 October 2023, ECLI:NL:HR:2023:1372).

The bill intended to give the pre-pack a statutory basis, the Business Continuity Act I (Wet continuïteit ondernemingen I), has not entered into force. Until it does, a buyer in a pre-pack must assume that the employees may transfer by operation of law on their existing terms, even if the bid was based on a different assumption.

May the former director restart the business?

Yes. No statutory rule prohibits a restart by a sitting director or shareholder. The trustee will, however, look at such a deal more critically, and two risks weigh more heavily.

A realistic price

When the buyer is a related party, an independent valuation and a transparent bidding process are almost indispensable; the trustee must justify the price to the supervisory judge and the creditors.

Director’s liability

Buying the assets does not protect a director against an investigation into mismanagement. If manifestly improper management was an important cause of the bankruptcy, each director is jointly and severally liable to the estate for the deficit (Article 2:248 BW). The general duty of proper performance under Article 2:9 BW also applies.

Personal liability towards an individual creditor requires a serious personal blame (persoonlijk ernstig verwijt), and the threshold is high. On 12 June 2026 the Supreme Court set aside a judgment of the Amsterdam Court of Appeal because it had not adequately reasoned why an indirect director was personally to blame towards a lender of the group (ECLI:NL:HR:2026:912).

In certain cases the court can also impose a disqualification order (civielrechtelijk bestuursverbod) of up to five years, for example for serious breach of the duty to inform and cooperate with the trustee or where transactions were annulled under the fraudulent preference rules (Article 106a Fw).

Can the trustee undo transactions before the bankruptcy?

Yes. Under the Dutch fraudulent preference rules (actio pauliana), the trustee can annul transactions that prejudiced the creditors. For a restart prepared in stages before the bankruptcy, that is a real risk.

• Article 42 Fw: a voluntary legal act performed before the bankruptcy that prejudices creditors can be annulled if the debtor knew or ought to have known this. If the act was not gratuitous, as with a sale, the counterparty must also have known or ought to have known.
• Article 47 Fw: payment of a debt that was already due can only be annulled if the recipient knew that a bankruptcy petition had already been filed, or if the payment resulted from consultation between debtor and creditor aimed at favouring that creditor.

Knowledge of prejudice under Article 42 Fw exists if, at the time of the act, both the bankruptcy and a deficit were foreseeable with a reasonable degree of probability for the debtor and the counterparty. Where legal acts form an interconnected whole, such as a series of transactions that together prepare a restart, the Supreme Court has confirmed that both the prejudice and the knowledge of it may be assessed for that whole (HR 20 June 2025, ECLI:NL:HR:2025:975). The trustee may then annul the entire set of transactions, not only the act at which knowledge was actually present.

An example to illustrate: a director transfers the customer base to a new company some months before the bankruptcy, and the new company later buys the remaining assets from the trustee. If the steps belong together and the bankruptcy was foreseeable at some point in the process, the whole construction is at risk.

What happens to contracts, the lease and permits?

They do not pass to you automatically. The bankruptcy does not end running contracts, but in an asset deal each contract must be transferred separately.

Transfer of a contract (contractsoverneming) requires a deed between the bankrupt company and you, with the cooperation of the counterparty (Article 6:159 BW). Check contract by contract whether transfer is possible and whether the counterparty will agree. Key customers and suppliers often use the moment to renegotiate terms.

The lease is subject to a special regime. Both the trustee and the landlord may terminate it early, with a notice period of three months in any event, and from the bankruptcy order onwards the rent is a debt of the estate (Article 39 Fw). You do not acquire the old lease automatically and will usually need a new lease with the landlord, or a separate transfer of the lease.

Public-law permits are often tied to a person or legal entity and must in most cases be applied for again. Start early, because a business cannot always operate without its permits in the meantime.

What should you check as a buyer?

Prepare before the bankruptcy order if you can: the trustee usually decides within days and gives no warranties.

• Have proof of funds and signing authority ready, without a financing condition in your bid.
• Check every asset for pledges, mortgages and retention of title before you price it.
• Assess whether the restart could be a transfer of undertaking, especially in a pre-pack.
• List the key contracts and the lease, and check whether each counterparty will agree to a transfer (Article 6:159 BW).
• Check which permits must be applied for again in the name of the buying company.
• If you are a related party, obtain an independent valuation and keep the bidding process transparent.

What should you check as a supplier, landlord or creditor?

Your claim stays behind in the bankrupt company, but you may still hold rights that the trustee and the buyer must respect.

• Check whether your retention of title clause is valid and identify your goods before the cooling-off period ends.
• File your claim with the trustee and ask for its acknowledgement in the bankruptcy.
• As landlord, decide whether to terminate the lease with three months’ notice under Article 39 Fw or negotiate a new lease with the buyer.
• Decide whether to continue supplying the buyer, and on what payment terms.
• Check whether transactions before the bankruptcy, such as a transfer of the customer base, prejudiced you as a creditor.

What can we do for you with a restart?

We advise buyers, directors and creditors as bankruptcy and insolvency lawyers, on the structure and risks before a bid.

• We prepare your bid and negotiate the purchase agreement with the trustee.
• We assess the transfer of undertaking risk and the selection of staff.
• We check security rights and retention of title on the assets you want to buy.
• We arrange the transfer of key contracts and the new lease.
• We advise directors on liability and actio pauliana risks before a restart by a related party.
• We enforce retention of title and file claims for suppliers and landlords.

Summary

• In a restart you buy assets from the trustee; the debts stay behind in the bankrupt company.
• Secured creditors and retention of title must be respected, so check every asset.
• Employees in principle do not transfer in a bankruptcy (Article 7:666 BW), but that exception has limits, and in a pre-pack it currently offers no certainty.
• A restart by the former director is allowed, but requires a realistic price and does not protect against director’s liability.
• Transactions prepared before the bankruptcy can be annulled as a whole under Article 42 Fw.

Frequently asked questions