The Dutch government has blocked U.S. company Kyndryl from acquiring Solvinity, the Dutch firm that operates critical infrastructure for DigiD, the national digital identity system used to access government services in the Netherlands. State Secretary Aerdts of Economic Affairs issued the prohibition based on a recommendation from the Investment Screening Bureau, citing risks to the public interest.
DigiD, short for Digitale Identiteit, is the primary authentication system for Dutch citizens and residents accessing government services including tax filings, healthcare records, and municipal administration. Solvinity provides hosting and operational support for the platform. The acquisition would have placed control of that infrastructure under Kyndryl, an IBM spinoff focused on managed IT services.
The Investment Screening Bureau, known as BTI, reviewed the proposed acquisition under the Insufficient Controls of Telecommunications Act and concluded that the deal posed risks to the public interest. Aerdts said he acted after receiving indications that completion of the transaction was imminent.
“The BTI advised me to prohibit this acquisition completely. I have adopted and accepted this advice,” Aerdts wrote in a letter to parliament. He emphasized that the screening was “country-neutral, risk-based, and proportionate” and not directed specifically at American companies.
The decision follows months of parliamentary debate over the implications of foreign ownership of Dutch digital infrastructure. The Dutch parliament voted in April to pull DigiD from Solvinity ahead of any takeover, and a Dutch court ruled in May that Solvinity could continue maintaining DigiD despite sovereignty concerns, pending the government’s investment screening decision.
Lawmakers had raised concerns that U.S. laws, including the CLOUD Act, could compel an American-owned operator to disclose data or restrict access to Dutch government systems. A coalition of Dutch technology experts, journalists, and privacy advocates also initiated legal action seeking to block the deal.
Kyndryl announced its agreement to acquire Solvinity in November 2025. The Dutch Authority for Consumers and Markets cleared the deal on competition grounds in February of this year, but the investment screening process operated on a separate track.
Sources: NL Times
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By Cass Kennedy
