Netherlands Considering Introducing Administrative Penalties for Sanctions Violations
The Netherlands is considering a new sanctions bill that could give the country power to impose administrative penalties alongside its existing criminal framework, create a “central reporting point” for sanctions, and put in place other measures to modernize the country’s sanctions implementation and rules, Dutch law firm Knepplehout said in a client alert this month.
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The bill would repeal the country’s “outdated” Sanctions Act of 1977 and replace it with the International Sanctions Act, which the firm said seeks to address the Netherlands' lack of administrative enforcement options, its “fragmented system of reporting obligations,” its “lack of adequate grounds for data exchange” and its “inadequate management and administration system.” The introduction of administrative enforcement powers may be the most noteworthy change for businesses, the firm said, adding that the government believes those types of penalties “may be more appropriate for certain cases given the nature and severity of the sanctions violation.”
Knepplehout said the bill would specifically allow the Dutch government to impose an “administrative order, an order subject to a penalty, or an administrative fine” against a sanctions violator, as opposed to the prison sentences, community service orders or monetary penalties available under criminal law. Administrative penalties would likely be reserved for "minor and mild" violations, the firm said.
The bill would also set the maximum administrative fine at the same level as the maximum criminal fine, and the government would need to boost coordination between enforcement authorities and the Netherlands Public Prosecution Service “to prevent duplication and because no one may be punished twice for the same offence.”
Knepplehout noted that the Netherlands’ Council of State, a government advisory body, submitted feedback on the bill in December, and the Dutch government is expected to amend it based on those suggestions. “After both the House of Representatives and the Senate accept the Bill, the International Sanctions Act can be implemented (expected 2026-2027),” the firm said.