Dutch Steins Bisschop declared bankrupt after KPMG pulls plug

KPMG's former Dutch legal practice Steins Bisschop Meijburg & Co was declared officially bankrupt last week as the big five accountant prepared to launch a new legal capability

The Lawyer has now learnt that KPMG first rejected a business plan to cut back to around 15 or 16 partners. It has now finalised the structure of a new nine-partner legal capability led by newly made up partner Rob Fassen, who joined from Landwell last year. The team also includes a new notary partner hired from De Brauw Blackstone Westbroek.
Of the original 21 Steins Bisschop partners, most have now found, or are looking for, jobs elsewhere after KPMG pulled the plug on loans to the practice amounting to millions of euros (The Lawyer, 8 April).
KPMG's new Dutch legal arm will be split into a six-partner KLegal arm based in Rotterdam and Amsterdam, and a two partner notary practice, named Van Agt & Dussel Notaries, in Rotterdam. This split brings the practice into compliance with new Dutch restrictions on combined legal and notarial practices, due to come into force later this year. The two practices will have around 40 other fee-earners between them and a total staff of 100.
The KLegal practice will focus on corporate, real estate, labour law, and banking and securities, and will also have teams specialising in IT, intellectual property and energy. The notary practice will cover corporate, real estate and family law.
The new structure goes much further than an original plan to reduce the size of the practice in order to make it more profitable. Partners entered restructuring discussions with their two creditors, KPMG and its tax lawyer practice Meijburg, early this year. They are understood to have arrived at a new structure comprising 15 to 16 partners. Restructuring costs were assessed by KPMG corporate restructuring in London. But the accountant was ultimately unprepared to fund the restructuring.
A spokesperson said: “Rob Fassen tried very hard to pursue plans involving the whole firm or a scaled back firm, but this didn't work. It was a financial issue. So now we're starting with a brand new firm, with the right structures and the right people and the full commitment of KPMG.”
KPMG had already lent Steins Bisschop in excess of e20m (£12.3m) under an agreement entered into in 1999 when the legal practice was launched. The money was to be paid back when the Dutch firm became profitable enough to do so. But this year, KPMG refused to go on paying the firm's salaries.
Steins Bisschop effectively became bankrupt after the cancellation of a joint account with KPMG in the Netherlands. Last month, it started summary proceedings against KPMG to force the accountant to pay salaries for March and April. The Lawyer understands that salaries for March have been paid following these proceedings. However, salaries for April will be paid by social security following the official declaration of bankruptcy.