What do the Dutch elections mean for Brexit?

Van Benthem & Keulen Advocaten

Today, voters in the Netherlands are heading to the polls to elect their next Government. It has been a very tight election race with Geert Wilders, controversial leader of the far-right Freedom Party, frequently making the headlines.

The Greater Birmingham Chambers of Commerce’s Brexit Advisory Group have been asking contacts in the Netherlands for their views on the election and what it means for Brexit. See below for Arno van Beurden, LL.M., Partner Van Benthem & Keulen Advocaten’s take on the election:

The elections for the Lower House, the Dutch Parliament, will take place on 15 March 2017.

The polls show that these elections will be very exciting. The media in particular focus on whether the party of Geert Wilders (PVV) or the Liberal Conservative Party (VVD) of the current Prime Minister Mark Rutte will become the largest party. The polls predict a close race between the two parties.

A possible first place for the PVV would be a confirmation of the discontent of a significant proportion of the Dutch voters about globalization issues such as immigration and transfer of national sovereignty to the EU. This trend was also evident in the Brexit referendum and the recent US presidential election.

In the Dutch parliamentary system, which is a system of proportional representation, the largest party however does not necessarily form the government. The Netherlands is traditionally a country where minorities co-exist peacefully and coalitions must be forged. Only the coalition with the support of more than half of the 150 MPs can form a government.

This system of compromise ties in perfectly with the Dutch mentality which has been shaped by the struggle against the water. When people living in a polder area threatened by the sea cannot come to an agreement, the enemy – in this case the sea – wins. This explains the Dutch art of ‘poldering’, which means ‘reaching compromise’. This ‘poldering’ creates political and socio-economic peace and ensures that socio-economic and political tensions eventually are solved by practical compromise.

Because of this system it is highly doubtful that the PVV could form part of a government coalition even if the PVV would become the largest party. The PVV has few experienced politicians suitable for government. In 2002, a party similar to the PVV, the party of Pim Fortuyn who was assassinated by an animal rights activist, was admitted to government and this was not a success. A tolerance agreement in the government's term of office from 2010 to 2012 was also not a success. This was a minority government of CDA [Christian Democratic Alliance] and VVD [People’s Party for Freedom and Democracy] with the passive support of inter alia the PVV, while the PVV did not provide members of the government. In view of this experience, it is highly unlikely that the PVV would actually participate in a government, not even if the PVV would become the largest party.

However it is expected that there will be a considerable shift to the right: the VVD with its political leader Mark Rutte is right-wing and will lose seats compared to the last elections for the Lower House but will probably remain the largest or the second largest party. It is predicted that the left-wing coalition partner of the VVD, the PvdA [Labour Party], which is the sister party of the British Labour Party), will be decimated. It is clear that this shift to the right will have consequences for the globalization-related issues such as immigration and EU membership: the next government cannot ignore the concerns over these issues of a considerable part of the population.

The above-mentioned system of ‘polderen’ also means that the concerns of a large majority are taken into account. Moreover, politicians are well aware that probably a majority of the voters has grave concerns about these issues: they only have to remember the rejection of the European Constitution to know that this certainly applies to further integration in the EU. Even though the major parties in general favour further European integration, it is doubtful whether this applies to the majority of the population and the politicians are well aware of this. It is obvious that the same applies to immigration and in particular immigration from Islamic countries: the murder of the Islam-critical publicist Theo van Gogh is a national trauma as is the murder of Pim Fortuyn. There is a reason why Mark Rutte kept his distance from the open-door policy of the German Federal Chancellor Merkel: his own voters would not forgive him if he openly supported this policy.

However, the Dutch economy is in good shape even though the political landscape is fragmented. There is a budget surplus and unemployment, which is already low compared to other EU countries, is declining.

The Netherlands is a trade-oriented nation, with many practical entrepreneurs and a shift to the right will probably strengthen rather than weaken this. Mark Rutte’s VVD is a very entrepreneur-friendly party and a post-election government without the VVD is almost inconceivable.

In the context of the Brexit negotiations, before the accession of the United Kingdom to the EEC, the Netherlands was often the country putting a brake on federalist tendencies.

After the accession of the United Kingdom the Netherlands could leave this task to the United Kingdom. Now that the United Kingdom has left the EU, the Netherlands will have to assume this role once again. The Netherlands has major commercial interests in the United Kingdom and the next government will certainly take these interests into account in the Brexit negotiations.

A hardline approach by the EU to the United Kingdom would probably affect the popularity of the EU in the eyes of the Dutch population and could even undermine support for the EU. The Netherlands owes its position as a trading nation to its location at the estuaries of large rivers between the three largest European countries Germany, France and the United Kingdom. It would be highly undesirable for the Netherlands if the result of the Brexit negotiations would not be acceptable to all parties concerned. 

Whatever the result of the elections: the Netherlands will remain an excellent country to invest and run a business in even after the elections. Moreover, it is a country where a large part of the population likes to trade and where English is spoken very well on the streets and in the shops by a generally well-educated population.

The last few governments, left-wing and right-wing, also invested heavily in the infrastructure and the Netherlands has excellent connections as befits a trading nation: this will not change because of the elections.

Arno van Beurden, LL.M., Partner

Van Benthem & Keulen Advocaten