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Article Netherlands: Appeals Court Orders Bank to Provide Cannabis Coffee Shop with Business Account

On March 26, 2024, the Dutch Court of Appeals in Arnhem-Leeuwarden (Gerechtshof Arnhem-Leeuwarden) held that the defendant bank must offer a coffee shop owner a business account and cannot categorically exclude coffee shops. Coffee shops are establishments where, in accordance with a toleration policy, cannabis, which is technically illegal in the Netherlands, may be sold and used but no alcoholic drinks may be sold or consumed. In addition, the court ordered the bank to allow the plaintiff the continued use of his private bank account for nonbusiness purposes.

Facts of the Case

The plaintiff is the owner of a coffee shop. He had a bank account with the defendant bank for both business and private purposes. The bank terminated his business bank account as of October 22, 2008, in particular because it did not want a coffee shop as a client. Since that date, the plaintiff used his personal account for business transactions as well. In August 2023, the bank announced that it would terminate the customer relationship with the plaintiff completely as of October 21, 2023, because he used his private account for business purposes contrary to the bank’s terms and conditions. (Appeals court decision, paras. 2, 3, 4.2; District court decision, paras. 2.2, 2.3.)

In 2008, as a matter of policy, all banks in the Netherlands categorically excluded coffee shop businesses from business accounts. However, in 2010, the Dutch minister of finance consulted with the Dutch Central Bank (De Nederlandsche Bank, DNB) with regard to this policy. They agreed that tolerated companies should have access to payment facilities to be able to “participate in society.” Member banks of the DNB agreed to instead assess the individual risks of each company in light of money laundering legislation. (Appeals court decision, para. 4.2.)

After the defendant bank completely terminated the customer relationship with the plaintiff, he sued to compel the bank to continue it for his private account and to enter into a new customer relationship with his coffee shop business. The district court rejected his claims, and he appealed the decision. (Appeals court decision, para. 2.)


The appeals court held in favor of the plaintiff. It stated that even though there is a legal right to a private basic bank account, there is no equivalent right for a business account. (Financial Supervision Act (Wet op het financieel toezicht, Wft), art. 4:71f.) However, banks may still be obligated to enter into a contractual relationship, in particular because it is virtually impossible to participate in society and operate a business without a bank account, in the opinion of the court. On the other hand, regulatory or integrity risks may justify refusing to grant a request for an account. The interests of the bank have to be weighed against the interests of the business owner. (Appeals court decision, para. 4.4.)

The defendant bank has an internal policy based on the Financial Supervision Act, which it used to justify the refusal of a business account. The policy states that companies are not eligible for a business account if more than 120,000 euros (about US$130,000) of their annual turnover is in cash, or if more than 10% of their turnover is cash, because the bank considers large amounts of cash a risk factor for money laundering and terrorist financing. The plaintiff’s cash turnover was more than half a million euros (about US$0.54 million) in 2021 and more than 1 million euros (about US$1.1 million) in 2022, respectively. However, the court explained that an email written to the plaintiff by the bank does not reference the cash requirement and makes it appear that the bank still categorically excluded cannabis business owners despite the nonbinding guidance of the DNB. Furthermore, it is uncontested that the plaintiff was not planning on making cash deposits in the future and does not do so currently for his private account used for business purposes. Lastly, the plaintiff stated that he would oblige customers to make debit card payments. In the opinion of the court, the defendant bank should have discussed options with the plaintiff. (Paras. 4.5–4.8, 4.10.)

The court concluded that the defendant bank did not provide enough evidence to convince the court that its interests would outweigh the interests of the plaintiff. It must therefore offer the plaintiff a business account without a cash deposit facility. Furthermore, it held that the bank must reactivate the plaintiff’s private account, because the decision to cancel the private account cannot be seen in separation from the decision to cancel the business account. In the opinion of the court, the termination of the private account was “unacceptable according to standards of reasonableness and fairness.” However, the plaintiff must cease to use the private account for business purposes once the business account is set up and must oblige his customers to use debit cards for almost all (more than 90%) of transactions. (Paras. 4.16, 4.18–4.20, 5.3.)

Jenny Gesley, Law Library of Congress
April 19, 2024

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