Clifford Chance

Dutch Government proposes bonus cap for financial sector

4 December 2013

On 26 November 2013, the Dutch Government issued a draft legislative proposal including further remuneration rules for employees in the financial sector. This proposal is drafted in the form of a consultation document to which market parties can respond before it will be submitted to Parliament as a formal legislative proposal. It is currently envisaged that the rules would take effect per 1 January 2015. The proposal's remuneration requirements and restrictions would apply on top of the restrictions already imposed under the Dutch rules implementing the Capital Requirements Directive (CRD III and CRD IV), the Alternative Investments Fund Managers Directive (AIFMD Directive) and the Undertakings for Collective Investment in Transferable Securities Directive (UCITS Directive).

Besides a more general requirement to establish a remuneration policy that meets certain criteria, to be specified by the Netherlands Authority for the Financial Markets (AFM) and the Dutch Central Bank (DCB), the proposal includes some additional restrictions and requirements, among which a bonus cap of 20% of fixed salary for all employees. The most important rules and restrictions, as well as the scope of the proposal, are set out in this client briefing.

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