Government wins case to extend DigiD provider Solvinity contract despite U.S. takeover

A court ruled on Wednesday that the government may extend its contract with IT service provider Solvinity. Three citizens had taken the case to court to prevent the extension, citing concerns about the planned acquisition of the Dutch company by an American firm.

The IT provider Solvinity runs key infrastructure, including the system behind DigiD. With US-based Kyndryl planning to take over the company, the plaintiffs argued in court that sensitive data could ultimately become accessible to American authorities if the deal goes through.

The acquisition of Solvinity by Kyndryl remains under review by the Investment Screening Bureau (BTI). According to the state’s legal counsel at the hearing, the Minister of Economic Affairs and Climate Policy has the authority to block the transaction should the probe indicate a potential threat to public interest.

The state’s lawyer said during the hearing on Wednesday that the government is still in talks with Solvinity about how the privacy of Dutch citizens can be safeguarded if the American company acquires its shares.

The claimants’ lawyer argued that the takeover would place Dutch citizens’ personal data “within immediate reach” of US authorities. He also warned that the United States could effectively gain control over a “kill switch” capable of shutting down systems such as DigiD and Mijn Overheid. Similar concerns had earlier been voiced by the top privacy official at Logius, which manages DigiD.

Because Wednesday marked the deadline for deciding on the extension of the contract with Solvinity, the judge delivered an immediate ruling. A detailed explanation of the decision will be provided within two weeks.