New Instruction Guides the Dutch Prosecutor on How to Handle Large Settlements

Main Elements of the Instruction

The Instruction replaces the 2008 Instruction on Large and Extraordinary Settlements. On several elements, it is brought closer in line with the DPPS's existing practice of handling large settlements. 

As to the term "large settlements", the Instruction applies to settlements involving a criminal penalty amount of at least EUR 200,000, and to settlements involving a total amount of EUR 1,000,000 (including, inter alia, disgorgements). The Instruction notes that in practice, large settlements only occur in relation to legal entities.

The Instruction recognizes that offering a large settlement requires a tailor-made approach based on various individual circumstances. The Instruction lists several non-exhaustive elements to be taken into account when determining a company's eligibility for a settlement and the settlement's amount, including: 

• Acknowledgement of the facts by the company. The Instruction explicitly mentions that this does not include any admission of guilt; 
• Compliance measures (to be) taken by the company to prevent further violations; 
• Whether the company self-reported the conduct and cooperated with the criminal investigation; and
• Whether the criminal investigation is connected to foreign investigations, and the potential for a joint settlement. 

In addition, the Instruction notes that the basic principle remains that responsible individuals should also be prosecuted "if possible".

Apart from any monetary element, the settlement agreement can include specific additional obligations, such as the obligation for the company to set up a monitor. In addition, a company can be instructed to regularly report to its Supervisory Board.

Independent Review

The Instruction introduces an independent review committee, consisting of a former lawyer, a former judge, a professor of criminal law, and former public prosecutors. The Review Committee is to assess whether the proposed settlement is reasonably appropriate and to advise the DPPS's Board accordingly. The Review Committee will also hear the Chief Public Prosecutor and the company prior to issuing its advice. In the event the Review Committee issues a positive advice, the DPPS's Board decides whether or not to offer the proposed settlement. In case of a negative advice, the case would be referred back to the Chief Public Prosecutor, who would then take a new prosecution decision. The Review Committee's advice will therefore play an important role in deciding whether a settlement will be reached.

Press Release and Transparency

Finally, in line with standing practice, the Instruction requires the DPPS to publish a press release together with an extensive statement of facts, to provide public accountability on how it handled the settlement of the case.

Judicial Review Bill Expected in October 2020

The Instruction is introduced in times of growing public and political concern regarding large settlements with companies in the Netherlands. Over the past few years, the DPPS has entered into a number of large-ticket settlements with prominent Dutch companies. Critics have argued that companies "buy off prosecution" and "get away" with improper conduct, and there are public claims of a lack of transparency. The DPPS has tried to address the asserted lack of transparency by issuing more elaborate and detailed press releases. However, there is also a broader call for the introduction of a form of court scrutiny of large settlements.

In response to this, the Dutch government is developing a bill that provides for a form of judicial review of such settlements. The Bill is expected to be released for public consultation in October 2020. The introduction of the Review Committee in the Instruction is to be regarded as an interim measure pending the Judicial Review Bill.