Kyndryl acquisition likely to cost Solvinity key Dutch contract

Kyndryl acquisition likely to cost Solvinity key Dutch contract

The Dutch House of Representatives has passed a motion by a majority calling on the government not to renew the DigiD hosting contract with Solvinity in 2028. This requirement applies only if the acquisition by the American company Kyndryl goes ahead. The motion was submitted by Barbara Kathmann of Progressief Nederland. Only JA21 voted against it.

The current contract between the Dutch government and Solvinity runs until 2028. The motion requests that the government not renew this contract upon its expiration if Solvinity is then under American ownership. A motion is not formally binding, but the government must report regularly on its implementation. State Secretary Eric van der Burg of the Interior simultaneously confirmed that the House of Representatives will now receive the full internal security analysis from Logius. Previously, only a summary had been shared.

That analysis is at the heart of the controversy. Pieter van Oordt, the chief privacy officer at Logius, the government agency that manages DigiD, has become a whistleblower. He revealed that the full analysis was never shared with the House, despite the risks described therein. Logius concludes internally that risk mitigation measures are not sufficient if Solvinity comes under American ownership.

What is at stake

The core of the concern is the U.S. CLOUD Act. That law can compel U.S. companies to share data with the U.S. government, regardless of where that data is physically located. In the event of a takeover by Kyndryl, DigiD-related systems would thus potentially fall under that scope. Previously, the ACM had already approved the takeover on competition grounds, but emphasized that security issues fall outside its assessment. The Investment Assessment Bureau (BTI) is still investigating whether national security is at stake.

Kyndryl promised that data would remain physically in the Netherlands and that Logius would retain the encryption keys. Nevertheless, coalition parties VVD, D66, and CDA also previously opposed the deal. Kyndryl is also grappling with its own problems: the company is under investigation by the SEC and has lost its CFO and general counsel.

Government knew of sale plans early on

Solvinity had already confidentially informed Logius in March 2025 about the search for a buyer. In April, a director at the Ministry of Justice and Security was also briefed. Yet at the time, the government turned down an opportunity to acquire Solvinity itself. A Dutch bid was only a few million euros lower than Kyndryl’s winning bid, which amounted to at least 100 million euros.

A group of experts and scientists previously went to court to demand greater transparency regarding the BTI investigation. The outcome of that investigation will partly determine whether the acquisition can ultimately proceed.