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This chapter discusses the law on creditor claims in the Netherlands. It deals with insolvency claims, administration claims, and non-enforceable claims in turn. Each section covers: the definition and scope of the claim; rules for submission, verification, and satisfaction or admission of claims; ranking of claims; and voting and other participation rights in insolvency proceedings. In essence, holders of insolvency claims (‘insolvency creditors’) are entitled to the liquidation proceeds of the debtor’s insolvency estate after the full discharge of the administration claims. Insolvency creditors (except secured creditors) can only pursue payment by submitting their claims for admission in the proceedings. Administration claims have to be satisfied in priority to insolvency claims and need not be submitted in the claims verification procedure. Holders of such claims (‘administration creditors’) can take recourse against assets comprised in the insolvency estate. Holders of non-enforceable claims can only seek recourse after the insolvency proceedings are terminated (provided that the debtor continues to exist).

The commencement of chapter 11 proceedings in respect of Lehman Brothers Holdings Inc (LBHI) triggered the downfall of its intricate web of group companies around the world. The Dutch incorporated second-tier subsidiary Lehman Brothers Treasury Co BV (LBT) was declared bankrupt on 8 October 2008 – the largest bankruptcy case in Dutch history and unprecedented in Dutch insolvency practice. Various new features were tested (and approved by the court) in the LBT proceedings which could provide important lessons for future large insolvency cases of issuers of debt securities on the international capital markets. Despite the fact that the Dutch Bankruptcy Code dates back more than a century ago and was not designed for several complex issues which arose in the LBT proceedings, the chapter argues, it did facilitate a tailored made solution for an effective and transparent settlement of the affairs of the main treasury entity of the Lehman Brothers group.

This chapter explores the main issues faced by the Lehman Brothers Treasury Co BV in the Netherlands (LBT) bankruptcy trustees in the valuation of (claims arising from) Notes and Certificates (LBT Notes). Legal and economic aspects of the definitive valuation principles adopted by LBT’s bankruptcy trustees are explained in detail. Although Dutch law applied to the valuation of insolvency claims, some references to foreign valuation regimes is made to illustrate alternative options for the valuation of certain types of insolvency claims or the need for statutory reform. The chapter first provides an overview of the procedure applied by the LBT bankruptcy trustees to establish valuation principles and the role of certain main stakeholders in this process. This chapter also looks at legal and economic aspects of the general valuation regime under the Dutch Bankruptcy Code (Faillissementswet) vis-à-vis the valuation of insolvency claims in the LBT proceedings and concludes with some observations on future legal reform.