Operating in the Netherlands under the current EU sanctions framework requires businesses to maintain active, documented compliance programmes that go well beyond one-off screening. EU sanctions – including asset freezes, transaction prohibitions and export controls – are directly applicable in all member states, and Dutch authorities, in particular the Autoriteit Financiële Markten (AFM) and De Nederlandsche Bank (DNB), enforce them with increasing rigour. Ferraz & Whitmore advises international companies, funds and financial institutions on structuring and stress-testing their sanctions compliance frameworks to reduce exposure before enforcement action arises.
Why Sanctions Compliance Demands Attention Right Now
The pace of EU sanctions legislation in 2026 has been exceptional. The 20th sanctions package was adopted on 23 April 2026, the same date on which Council Regulation (EU) 2026/506 introduced a significant procedural protection: EU persons facing litigation brought by sanctioned Russian persons in Russian courts – in breach of agreed jurisdiction or arbitration clauses – now benefit from an anti-suit mechanism at EU level. A parallel measure was adopted in Switzerland under art. 29d. The 21st sanctions package (Reg (EU) 2026/1848) followed on 23 July 2026, tightening existing restrictions and adding new designations. From 24 May 2026, transactions involving the digital rouble (RUBx) are explicitly prohibited.
For businesses registered in the Netherlands – whether a besloten vennootschap (BV) listed in the Kamer van Koophandel (KvK) or a foreign entity with Dutch operations – each new package generates an immediate obligation to re-screen counterparties, revisit contracts, and update internal controls. Failure to do so is not treated as a technicality; Dutch prosecutors and supervisory authorities regard an absence of documented corrective action as evidence of systemic non-compliance.
Who Needs a Sanctions Compliance Programme in the Netherlands
The obligation to comply with EU sanctions is universal and does not depend on sector or size. In practice, the following types of organisations face the highest residual risk:
- Trading companies and distributors with supply chains touching sanctioned jurisdictions, including indirect exposure through intermediaries.
- Financial institutions and payment service providers supervised by DNB or the AFM, which are subject to both sanctions law and anti-money-laundering obligations that interact with asset-freeze requirements.
- Technology and dual-use goods exporters, for whom export controls under the EU Dual-Use Regulation overlay the sanctions framework and require independent licensing analysis.
- Professional service providers – lawyers, accountants, consultants – who may unknowingly facilitate circumvention if they do not apply a best-efforts obligation in reviewing client instructions.
- Investment funds and family offices managing portfolios with Russian, Belarusian or other sanctioned-country exposure, including indirect holdings through fund-of-fund structures.
If your organisation falls into any of these categories and has not updated its sanctions screening procedures since April 2026, the gap is material. We can help you assess where the exposure lies and what internal steps are proportionate.
To discuss your organisation's specific position, contact us at info@ferrazwhitmore.com or visit our contacts page.
The Legal Instruments: What Dutch Law Adds to the EU Framework
EU sanctions regulations are directly applicable without transposition, but the Netherlands has its own layer of implementing legislation that determines enforcement competence, penalty ranges and procedural rights. The Sanctiewet 1977 and the associated ministerial decrees set out the national architecture; supervision is divided between the AFM (securities and financial markets), DNB (credit institutions, insurance, payment institutions) and, for trade controls, the Ministry of Foreign Affairs (Ministerie van Buitenlandse Zaken).
Dutch courts, including ultimately the Hoge Raad, have jurisdiction over civil disputes arising from sanctions-related contract frustration, force majeure defences and asset-freeze consequences. The anti-suit protection introduced by Council Regulation (EU) 2026/506 is particularly relevant in this context: a Dutch entity that has been dragged into Russian court proceedings in violation of an arbitration clause now has an explicit EU-law basis to seek relief, and Dutch courts have competence to apply that mechanism.
Export controls add a further dimension. The EU Dual-Use Regulation establishes control lists and licensing obligations; Dutch implementation channels these through the central government's export control unit. Violations of export controls in connection with sanctioned destinations carry criminal as well as administrative consequences and are increasingly investigated in parallel with sanctions breaches.
Circumvention Risk: The Issue That Regulators Prioritise
Sanctions circumvention – routing transactions through third-country intermediaries to evade restrictions – has become the primary focus of EU enforcement guidance in 2026. The 21st package (Reg (EU) 2026/1848) expanded the list of third countries and entities that trigger enhanced due diligence obligations precisely because they are regarded as circumvention vectors.
For Dutch businesses, the practical risk arises in several scenarios:
- Purchasing goods or services from entities in third countries that have re-exported sanctioned items from Russia or Belarus.
- Receiving payment via correspondent banking chains that include non-EU banks with undisclosed Russian beneficial ownership.
- Providing professional or technical services to a non-sanctioned entity that is ultimately controlled by a designated person.
- Holding or transacting in RUBx or instruments linked to the digital rouble infrastructure, which became prohibited from 24 May 2026.
The best-efforts obligation codified in EU guidance means that a company cannot simply point to the absence of a direct counterparty designation. Regulators expect documented enquiry into beneficial ownership, the ultimate end-user of goods, and the purpose of services provided. Where a company knew or should have known of a circumvention risk, the absence of enquiry is itself a violation.
Our team has developed practical guidance on circumvention indicators and their application to Dutch-registered entities. You may also find our analysis of sanctions circumvention risk relevant to your due diligence framework.
Procedures and Timelines
A structured compliance review typically proceeds in four phases:
- Screening and gap analysis: mapping existing counterparty data against current consolidated lists (EU, UN, OFAC where relevant), identifying gaps in KYC documentation, and benchmarking current procedures against the obligations under each applicable package. This phase typically takes two to four weeks depending on the complexity of the counterparty portfolio.
- Remediation: updating contractual clauses (sanctions representations, termination triggers, RUBx exclusions), revising onboarding questionnaires, and training operational teams. Timelines depend on the volume of contracts requiring amendment but are generally achievable within one to three months.
- Voluntary disclosure and regulator engagement: where a potential breach is identified, early engagement with DNB or the AFM – supported by a clear remediation plan – is generally regarded more favourably than reactive disclosure. Dutch supervisory practice does not guarantee outcome, but the timing and quality of disclosure are consistently treated as material factors.
- Ongoing monitoring: given the frequency of package updates in 2026, a quarterly review cycle is the minimum defensible standard for most businesses. High-risk sectors may require monthly or event-driven re-screening.
Typical Pitfalls
Clients often approach us after encountering one of the following situations:
- A longstanding supplier relationship disrupted because a beneficial owner of the counterparty appeared on a newly published designation list, and no re-screening process had been triggered by the new package.
- A Dutch BV receiving payment from a bank that DNB subsequently identified as a potential circumvention channel, creating a retroactive asset-freeze risk analysis obligation.
- Contracts governed by Dutch law containing no sanctions termination clause, leaving the parties in legal uncertainty when performance became impossible or prohibited.
- Group treasury functions continuing to use RUBx-denominated instruments after the 24 May 2026 prohibition date without realising the new restriction applied to their specific instrument.
- Professional service providers advising clients on restructurings without applying a dedicated sanctions check to the post-restructuring ownership structure.
Self-Assessment Checklist
The following questions provide a starting point for an internal review. A "no" or "unsure" answer to any of them suggests a compliance gap worth addressing:
- Have all counterparties been re-screened against the consolidated EU list following the 21st sanctions package (23 July 2026)?
- Do your standard contracts include sanctions representations and a mechanism for termination if a counterparty becomes designated?
- Has your organisation confirmed that no transactions involve the digital rouble or RUBx instruments since 24 May 2026?
- Do your onboarding and KYC procedures require ultimate beneficial ownership disclosure to a level sufficient to detect indirect sanctions exposure?
- Is there a documented procedure for escalating potential circumvention indicators to a compliance officer or external counsel?
- Has your organisation reviewed the anti-suit protection under Council Regulation (EU) 2026/506 if you have existing arbitration agreements with Russian counterparties?
- Are staff who handle trade, payments or counterparty management trained on the most recent package changes?
Cross-Border Dimension
Many businesses operating in the Netherlands maintain group structures, supply chains or contractual relationships that span multiple jurisdictions. EU sanctions apply uniformly across member states, but enforcement priorities, procedural rules and supervisory approaches differ. A group operating through Dutch, Portuguese and Swiss entities, for example, faces three distinct supervisory environments, and the Swiss parallel measure under art. 29d creates obligations that do not map precisely onto the EU framework.
Ferraz & Whitmore's cross-jurisdictional capability allows us to coordinate advice across these environments, ensuring that a compliance measure adopted in one jurisdiction does not inadvertently create exposure in another. Our sanctions and trade practice in Portugal operates alongside our Dutch advisory work, providing a coherent approach for groups with Iberian and Benelux footprints. For matters requiring Dutch corporate law support in connection with sanctions restructuring, our corporate law practice for the Netherlands can assist with entity-level analysis and documentation.
Where a client faces litigation risk arising from Russian counterparties invoking Russian court jurisdiction in breach of agreed clauses, Council Regulation (EU) 2026/506 provides a new procedural tool that we can advise on in the context of Dutch proceedings or international arbitration.
How Ferraz & Whitmore Works on Sanctions Mandates
Our approach is to begin with a structured scoping conversation to understand the business model, the relevant counterparty base and the specific trigger that brought the client to us. From that basis, we develop a proportionate work plan: we do not apply a standard audit methodology uniformly regardless of risk profile. For a trading BV with limited financial-services activity, the priority issues differ from those facing a payments institution or a fund manager.
We work with in-house legal and compliance teams rather than displacing them. Where a matter has a criminal investigation dimension or involves a formal supervisory enquiry from DNB or the AFM, we coordinate with Dutch criminal defence or regulatory counsel as appropriate. Our role is to provide the EU-law and cross-border analytical layer that in-house teams often lack the bandwidth or specialisation to supply at pace.
Timelines are driven by urgency: if a breach has already occurred or a supervisory request has been received, we treat the matter as time-critical and structure our work accordingly. For proactive compliance reviews, we can typically deliver an initial gap analysis within two to three weeks of engagement.
If you have identified a compliance concern or wish to conduct a proactive review, we welcome an initial discussion. Write to us at info@ferrazwhitmore.com or use our contacts page to arrange a call with our sanctions team.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.