In November of 2021, SFNet announced its first Cross-Border Finance Essay Contest, sponsored by Goldberg Kohn Ltd. Members of SFNet’s International Finance and Development Committee judged the essay submissions on content, originality, clarity, structure and overall contribution to furthering and expanding understanding and discourse within the field of cross-border finance. This essay tied for third place.

The authors of the winning essays have been invited to participate on a panel at SFNet’s 78th Annual Convention in Austin, TX, Nov. 9-11. The second place and first place winners will be published in the October and November issues of TSL, respectively.

Vroom & Dreesmann

Brothers-in-law Willem Vroom and Anton Dreesmann opened their first department store in 1887, in the heart of Amsterdam, the Netherlands. Over the years, Vroom & Dreesmann became an iconic Dutch chain of department stores. The stores were a huge success and Vroom & Dreesmann rapidly expanded in the 20th century, opening new stores in almost every city in the Netherlands. V&D, as it was officially rebranded in 2007, targeted a regular retail crowd, selling clothing, electronics and home accessories. It also had its own in-house travel agency and operated a chain of restaurants that were located both inside the department stores and externally, with locations even in New York City and Bali, Indonesia. A visit to V&D’s School Campus, a special department set up in August for office and school supplies, traditionally marked the end of the summer for generations of high school students. Its long history and household name, however, did not last. V&D’s story ended on December 31, 2015, when it was declared bankrupt by the Amsterdam court and bankruptcy trustees were appointed to liquidate V&D’s assets.

In 2017, the trustees ended up in court in a dispute with one of V&D’s suppliers. The dispute concerned the ownership of bedding materials and towels, more specifically. This dispute led to a decision from the Amsterdam court of first instance on November 8, 20171, concerning an element of Dutch law that is key to ABL professionals dealing with inventory in the Netherlands: the right of reclamation (in Dutch: recht van reclame). As this decision by the Amsterdam court has shown, the right of reclamation can have a significant impact on Dutch inventory and the position of ABL borrowers and ABL lenders.

In this essay, I will discuss the right of reclamation in light of the proceedings between V&D’s bankruptcy trustees and V&D’s supplier and I will describe why you, as ABL professionals, should take good caution when working on ABL transactions involving Dutch inventory. 

Please click here to read the essay.