The Dutch government has prohibited a transaction for the first time, and the Vifo Act is set to expand dramatically, bringing six new technology categories within scope from 1 January 2027. The BTI's 2025 Annual Report confirms a record caseload, and new EU-wide screening rules have been formally adopted. Below, we break down what happened and what it means for your next deal.
In this blog, we cover four developments that every deal team should be aware of:
- The Vifo Act is set to expand significantly, bringing six new categories of sensitive technology within its scope from 1 January 2027.
- The BTI has prohibited a transaction for the first time, blocking the acquisition of Solvinity by US-listed Kyndryl.
- The BTI's 2025 Annual Report confirms a record caseload, and the revised EU FDI Screening Regulation has been formally adopted.
- The Dutch cabinet has adopted the Wet Weerbare Defensie-industrie (Resiliant Defence Industry Act or "WWDI")), introducing a dedicated investment screening regime and supply-security measures for the defence industry.
How the Vifo Act works – and why it matters
The Vifo Act (in force since 2023) requires prior notification to the BTI of investments, mergers and acquisitions involving companies active in (highly) sensitive technologies, vital providers and managers of business campuses. A notification is triggered when an investor acquires controlling influence, or, for highly sensitive technologies, significant influence (shareholding as low as a 10% or the right to appoint a single board member). In case of serious concerns for the national security of the Netherlands, the BTI can impose conditions or, as an ultimate remedy, prohibit the transaction. In addition, the BTI administers sector-specific screening regimes in the telecommunications and energy sectors.
Six new technology categories added to the Vifo Act from 2027
On 9 June 2026, the Minister of Economic Affairs and Climate Policy submitted a draft decree to Parliament proposing to bring six additional technology categories within the scope of the Vifo Act. The decree is subject to a four-week parliamentary review period, followed by an advisory opinion from the Council of State. Entry into force is expected on 1 January 2027.
The six new categories of sensitive technology proposed for inclusion are:
- Advanced materials technology (e.g. energy materials, two-dimensional (2D) materials and high-entropy alloys);
- Artificial intelligence;
- Biotechnology (including synthetic cell technology, stem cell technology, gene editing and genomics);
- Nanotechnology (programmable nanomaterials and micro-/nanoreactor technology);
- Sensor and navigation technology (SLAM technology, sensor fusion and array technologies, sensor network and ambient technologies, and signature management and pattern recognition technology); and
- Nuclear technology for medical applications.
All six categories will be designated as highly sensitive, meaning the lower notification threshold of significant influence applies. In practice, even a minority stake conferring meaningful influence over strategic decisions will trigger the notification obligation. In addition, several existing dual-use technologies in information security and laser satellite communication will be reclassified as highly sensitive.
The impact will be substantial: an estimated 1,015 to 1,730 additional companies will fall within scope, generating approximately 125 extra notifications per year. Ongoing deals that have not closed by 1 January 2027 may be affected.
Further scrutiny to be expected in the defence industry
On 8 July 2026, the Dutch cabinet adopted the legislative proposal for the WWDI, a new act designed to strengthen the Dutch defence and security-related industrial base and reduce strategic dependence on foreign suppliers. The WWDI will now be submitted to the Council of State for advisory review before parliamentary debate. Entry into force is possible in the course of 2027. As part of the WWDI, a further sector-specific investment screening test (defensie-veiligheidstoets) for essential armed forces suppliers and designated defence companies will be introduced. The test operates alongside the Vifo Act and targets transactions – including acquisitions of as little as 10% of the voting rights – that may pose risks to essential defence interests. The BTI will act as the screening authority.
For deal teams, the WWDI means that transactions involving the Dutch defence supply chain will face a dedicated layer of scrutiny in addition to the Vifo Act. Companies active in the area of military goods, dual-use products, or designated defence suppliers should factor this new regime into their transaction planning.
First-Ever FDI Prohibition: the Solvinity/Kyndryl Decision
On 25 May 2026, the Dutch government prohibited the proposed acquisition of Solvinity, a managed IT and cloud services provider serving Dutch government entities (including DigiD) and organisations in sensitive sectors, by US-listed Kyndryl. This is the first-ever prohibition of a transaction under Dutch FDI rules, although the decision was taken under the sector-specific Telecoms Act, not the Vifo Act.
The transaction had attracted significant political and media attention, including a full parliamentary briefing involving the BTI and Kyndryl, with many calling for the deal to be blocked.
The prohibition was based on the assessment that the transaction posed unacceptable national security risks that could not be mitigated through conditions – consistent with the broader EU trend toward greater technological sovereignty.
The message is clear: the BTI's enforcement powers are not merely theoretical. Transactions involving companies in sensitive or vital sectors will face rigorous scrutiny, and prohibitions are a real possibility.
Solvinity and its owner, Vitruvian Partners, initiated summary proceedings to challenge the decision, but the court upheld the prohibition. The parties also filed an administrative appeal with the Dutch government, which is expected to take a decision by the end of September. We will continue to monitor these developments closely.
BTI Annual Report and New EU Screening Rules
Record Caseload: Key Figures from the BTI's 2025 Annual Report
The BTI's 2025 Annual Report (published 30 April 2026) reveals a record year. The BTI received 78 new notifications plus 13 carried over from 2024, making 2025 its busiest year since the Vifo Act entered into force. The increase is largely driven by the progressive expansion of what qualifies as "sensitive technology" under the legislation, rather than by a shift in the BTI's own enforcement posture. Notification volumes are expected to continue rising.
Key figures from the report:
- 76 investigations concluded: none progressed to a second-phase review and no transactions were blocked. Two approvals were granted subject to conditions.
- Average processing time: 37 days (25% completed within 20 days).
- Most common technology categories: dual-use goods (39), photonics (19), semiconductors (13), quantum technology and military goods (11 each).
- Top acquirer origins: the Netherlands (41), the United States (8), Luxembourg and Germany (5 each).
- The BTI handled 16 informal opinion requests and imposed its first-ever fine for failure to notify a transaction prior to completion.
In a related development, BTI officials were formally designated as supervisory officers under the Availability of Goods Act, enabling their deployment in the high-profile Nexperia case involving oversight of a Chinese-owned Dutch semiconductor company.
What this means for your next Dutch deal
The direction is clear: more transactions will be caught, scrutiny will intensify, and no deal team operating in or around the Netherlands can afford to overlook FDI screening. Whether you are a strategic acquirer, a private equity sponsor, a target company or an adviser, the question is no longer if your transaction will be affected, but when and how.
How we can help
Our team advises on FDI screening across a wide range of sectors and transaction structures, from early-stage risk assessments and informal BTI opinions to full notification procedures and post-closing compliance. If you would like to discuss how these developments affect your business or a specific transaction, please contact us.
