NEW BELGIAN COMPANY CODE !
On February 28th, 2019 Belgian Parliament has adopted the new Belgian company code. This code (“WVV”) introduces some important changes in Belgian company law. The new code will include associations and foundations.
The reform is mainly focused to increase the flexibility of the Belgian company legislation and thus, to make investing in Belgium more attractive to foreign investors.
Summarized we can highlight the following major changes:
1.
The number of type of companies with legal personality will be reduced to 7 with a key role for the BV ( Besloten Vennootschap) previously the BVBA/SPRL. The legislator wants this company type to become the ‘default’ company for Belgium.
2.
The old legislation concerning the BVBA was rather strict. Under the new legislation the structuring, governance and operation of the BV will become very flexible, for example
- It will be possible to have 1 shareholder ( joint liability!)
- the shares of an BV can be listed
- the transferability can be freely determined in the by laws
- a minimum corporate capital is no longer required. ( the focus will change towards net asset and liquidity tests)
- there will be more freedom to distribute and allocate profits
- it will be possible to create shares with multiple voting rights
3.
The NV (Naamloze Vennootschap) will be ‘reserved’ for very large and /or listed companies. Below are the most important changes.
- the general principle that the mission of directors can be terminated at any time (ad nutum) is abolished. The company and the director can agree with notice periods and/or payments.
- it will be possible to create shares with multiple voting rights
- it will be possible to have only one shareholder ( joint liability!)
- Flexibility concerning governance: it will be possible to choose for a system with one sole director, for board of directors or for a management committee combined with a supervisory board.
4.
Directors’ liability will be capped.
The liability for directors and ‘de facto’ directors will be capped between EUR 250.000 and EUR 12 MIO depending on the size and activities of the company ( except a.o. in case of fraud).
5.
The WVV also provides that the Belgian legislation will apply as soon as the registered office is located in Belgium. Foreign companies will be able to choose for a Belgian legal company form and nationality by moving their registered office to Belgium. Under the previous law the companies’ nationality was determined on the basis of the country where it’s real office was located.
Transition period
The new Company Code will take effect from May 1st, 2019. For existing companies, associations, foundations the new company code will take effect on, January 1st, 2020, with a possibility to apply the new legislation earlier ( “Opt in”). Companies, associations, foundations have to amend their by-laws with the new legislation whenever its by-laws are changed after January 1st, 2020. In any case the by-laws of all companies have to be amended before January 1st, 2024.
Please contact our firm if you have any further questions.
Christoph Hanssen, Partner (c.hanssen@elegis.com)
Annemie Coox, Partner (a.coox@elegis.com)