Duty to provide information in a WHOA plan

Background of the case

The WHOA (the Dutch Act on Private Restructuring Plans) offers businesses in financial distress the possibility of having a restructuring plan approved by the court without the consent of all creditors. An essential part of this procedure is the debtor’s duty to provide information. This obligation means that the debtor must disclose all relevant information that could influence the creditors’ decision-making.

The ruling

In this case, the court held that the debtor had breached its duty to provide information. Specifically, the debtor failed to supply information regarding the assets held by group companies. The court emphasised that, depending on the circumstances, a debtor may also be required to provide information about the financial position of companies affiliated with the debtor. Failure to meet this obligation may result in the court rejecting the request for confirmation (homologation) of the plan.

What information was missing?

The court found that the debtor:

• Provided insufficient transparency about group companies – Certain affiliated entities’ financial situations had not been fully disclosed. This was particularly relevant because the group companies were jointly liable for various (bank) debts.
• Gave little or no detail about assets and liabilities within the group – As a result, creditors were unable to properly assess whether additional funds were available to meet debts.
• Provided no insight into intra-group cash flows – Meaning creditors could not verify whether certain funds were being kept outside the plan.
• Did not supply sufficient information about assets – Such as cash, real estate, or other property relevant to the plan’s value.

Despite these shortcomings, the court still confirmed the WHOA plan. The court found that the missing information was ultimately not decisive for the outcome the vote on the restructering plan.

The key considerations were:

• No demonstrable disadvantage to creditors – There was insufficient evidence that creditors were harmed by the missing information. The plan still offered them a better result than bankruptcy.
• No bad faith – There was no indication of deliberate deception or fraud by the debtor, but rather an incomplete level of financial transparency.
• Fair distribution of burdens – The court examined the overall financial situation and concluded that, despite the lack of full disclosure, the debtors were not unduly favoured over the creditors.
• Support from a sufficient majority of creditors – The plan was supported by most creditors, which weighed heavily in the court’s decision.

In summary, although the debtor had not fully complied with its duty to provide information, the court assessed whether this had a material impact on the creditors. Since no such impact was established and the plan was still considered fair, the court confirmed the plan.

Implications for practice

This ruling highlights the importance of transparency and full disclosure in WHOA proceedings. Debtors must not only clearly communicate their own financial situation, but also that of any group companies that may affect the plan. Failure to do so can have serious consequences, including rejection of the plan by the court.

The complete ruling can be read on the court’s website: ECLI:NL:RBZWB:2025:524, Rechtbank Zeeland-West-Brabant, C/02/430146 HO RK 24/995 (E).

More information

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