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What about subsidiaries and parents of cluster munition companies?

Section 21a(2) of the Market Abuse Decree under the Financial Supervision Act forbids investments in or loans to parent companies of cluster munitions companies if the parent owns 50% or more of the share capital of the subsidiary. What is the approach to the reverse situation, where investments are made in a subsidiary that, unlike its parent company, does not engage in cluster munition activities? 

A subsidiary whose parent company is involved in cluster munition activities, while the subsidiary itself is not, falls outside the scope of the legal ban. Section 21a of the Market Abuse Decree under the Financial Supervision Act actually expresses the Dutch Parliament’s desired “ban on evidently direct investments in the manufacture, sale and distribution of cluster munitions.” However, this does not dilute the responsibility of a financial enterprise or restrict its freedom to place such a subsidiary on a more extensive exclusion list. In this example situation, obviously no loans should be granted to the parent company involved in cluster munitions or any investments made in it. 



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