A majority of members of the House of Representatives oppose the acquisition of Solvinity by the American company Kyndryl. Coalition parties VVD, D66, and CDA also believe that vital digital infrastructure should not fall into American hands.
This became clear during a debate in the House of Representatives on Wednesday evening. Solvinity, which is originally Dutch, is currently being assessed by the ACM and the Investment Assessment Bureau (BTI), which falls under the Ministry of Economic Affairs. The BTI is assessing whether national security is at stake.
VVD representative Hilde Wendel was clear: “The cabinet must put a stop to this. It is now irresponsible to create a new strategic dependency. Our citizens’ data is not an export product.” The ruling party is open to various routes to block or reverse the acquisition.
Vital infrastructure for the Netherlands
Solvinity provides the platform on which DigiD, MijnOverheid, and secure communications for Justice and Security run. The CDA spoke of “critical infrastructure for the Netherlands” that must remain in Dutch or European hands. D66 member Sarah El Boujdaini also opposed the sale: “Digital resilience is national security.”
The concern extends beyond this acquisition alone. Experts had previously demanded transparency about the deal. Municipalities that chose Solvinity because of national control, including Amsterdam, also felt blindsided.
It is striking that a Dutch bid was only a few million lower than Kyndryl’s. The government passed up an earlier opportunity to buy Solvinity itself.
US legislation as a risk
The fear is mainly focused on the US CLOUD Act. This law can force American companies to share data with the US, even if it remains in the Netherlands. Kyndryl promised technical and legal safeguards. For example, data will remain in the Netherlands, services will run in the EU, and access will be limited to EU territory.
However, members of parliament remain skeptical. Kyndryl was unable to allay these concerns during a presentation to the House of Representatives. Parliamentarians pointed out that the unrest surrounding DigiD is symptomatic of the enormous dependence on American tech companies.
Meanwhile, Kyndryl itself is facing problems. The company is being investigated by the US Securities and Exchange Commission (SEC), has lost its CFO and legal head, and has seen its share price fall by 55 percent.
Waiting for review
Outgoing State Secretary Eddie van Marum of the Interior stuck to the course set out. The cabinet wants to wait for regulators’ assessments, while “mitigating measures” are agreed upon in the meantime. He also emphasized the importance of continuity: DigiD must continue to operate.
Outgoing Minister Vincent Karremans of Economic Affairs referred to the 2020 Telecommunications Undesirable Control Act. “We are therefore following the exact process that has been in place since then to assess cases of this kind. That is an apolitical judgment.” He advised against motions that preempt the review.
Nevertheless, the House of Representatives adopted a series of motions, including a widely supported call to prevent Solvinity from being sold. In case the sale does go ahead, the House adopted a motion not to renew the contract with Solvinity when it expires in 2028.