Factoring Agreement

Factoring Agreement Template for Netherlands

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Key Requirements PROMPT example:

"I need a Factoring Agreement under Dutch law for a manufacturing company selling receivables to a bank, with recourse, including credit insurance requirements and international debtor provisions, to be effective from March 1, 2025."

Document background

This Factoring Agreement template is designed for use in the Netherlands when a business wishes to sell its accounts receivable to a financial institution for working capital financing purposes. The agreement comprehensively addresses the requirements of Dutch law regarding assignment of receivables (cessie), financial supervision regulations, and data protection requirements. It is suitable for both domestic and international factoring arrangements, with specific provisions that can be adapted for disclosed or undisclosed factoring. The document includes detailed sections on operational procedures, credit risk allocation, and reporting requirements, making it appropriate for various business sectors and transaction sizes. The template is structured to comply with Dutch civil law requirements for valid assignment and incorporates market standard provisions for factoring transactions in the Netherlands.

Suggested Sections

1. Parties: Identification of the Factor and the Client (Supplier)

2. Background: Context of the agreement and general purpose of the factoring arrangement

3. Definitions and Interpretation: Definitions of key terms and interpretation rules

4. Assignment of Receivables: Core provisions regarding the assignment of receivables and perfection requirements

5. Purchase Price and Payment Terms: Calculation of purchase price, advance rate, reserves, and payment mechanics

6. Eligibility Criteria: Criteria for receivables to qualify for purchase

7. Representations and Warranties: Client's representations regarding business, receivables, and compliance

8. Covenants: Ongoing obligations of the Client

9. Collection and Servicing: Provisions regarding collection of receivables and account management

10. Fees and Charges: All fees, discount rates, and charges applicable

11. Events of Default: Circumstances constituting default and consequences

12. Term and Termination: Duration, renewal, and termination provisions

13. Confidentiality: Protection of confidential information and data protection compliance

14. Notices: Communication procedures between parties

15. Governing Law and Jurisdiction: Choice of Dutch law and jurisdiction provisions

Optional Sections

1. Credit Insurance: Required if receivables are to be credit insured, specifying insurance requirements and responsibilities

2. Import/Export Provisions: Required for international factoring arrangements

3. Recourse Provisions: Detailed provisions if the agreement is with recourse to the Client

4. Security Arrangements: Additional security requirements if applicable

5. Electronic Platform: Terms for use of electronic factoring platform if applicable

6. Sub-participation: Required if the Factor may sub-participate the receivables

7. Parent Company Guarantee: Required if parent company guarantee is part of the arrangement

Suggested Schedules

1. Eligibility Criteria Details: Detailed list of eligibility requirements for receivables

2. Fee Schedule: Detailed breakdown of all fees, charges, and calculation methods

3. Form of Assignment: Template for assignment documentation

4. Notification Forms: Templates for debtor notification

5. Operating Procedures: Detailed procedures for daily operations and submissions

6. Approved Debtor List: List of approved debtors and their credit limits

7. Required Reports: Templates and specifications for required reporting

8. Form of Client Access Letter: Template for authorizing client representatives for platform access

9. Data Protection Requirements: Specific procedures and requirements for GDPR compliance

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok��˰� | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

alex.den.21@genieai.co

Relevant legal definitions

Clauses

Relevant Industries

Manufacturing

Wholesale Trade

Construction

Transportation and Logistics

Professional Services

Retail

Technology

Healthcare

Agriculture

Industrial Services

Relevant Teams

Legal

Finance

Treasury

Credit Control

Accounts Receivable

Risk Management

Operations

Compliance

Commercial

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Credit Controller

Accounts Receivable Manager

Commercial Director

Legal Counsel

Risk Manager

Operations Manager

Financial Controller

Credit Risk Manager

Relationship Manager

Compliance Officer

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