Despite a long and uncertain parliamentary journey, and a government of “current affairs”, the new Belgian Companies and Associations Code has finally been adopted by Parliament on 28 February 2019.
The Code triggers a major overhaul of the existing rules applicable to companies and associations under Belgian law.
To name a few:
- The rules on companies and associations are integrated in the same Code and now expressly authorize associations to exercise commercial activities;
- Several company forms will disappear, such as the limited partnership with a share capital (CommVA/SCA) or the companies with a charitable object (VSO/SFS) and the legal form of cooperatives (CV/SC) is now reserved for companies with a specific cooperative purpose;
- There are no capital requirements for private limited liability companies (SRL/BV) but liquidity and solvency tests have to be applied before any distribution of benefits;
- It is possible to confer multiple voting rights to shareholders of limited liability companies, with a maximum of double voting rights in case of a listed company;
- There are new governance rules for the public limited liability company (NV/SA), which make it possible to choose between a one-tier or an effective two-tier board or to have only one director managing the NV/SA;
- The Code provides liability caps for directors’ liability (between 125.000 EUR and 12.000.000 EUR);
- The new Code will apply to all companies having their statutory seat in Belgium (“incorporation theory”), and no longer to those having their real seat or centre of main activities/interests (COMI) in Belgium (“real seat theory”).
The New Code will apply immediately to companies and associations incorporated after the new Code's entry into force on 1 May 2019.
Companies and associations incorporated before its entry into force will be governed by the new Code as from 1 January 2020 (with the possibility of an earlier opt-in) and will have to amend their articles of association no later than 1 January 2024. Companies whose legal form will no longer exist and which have not amended their legal form will be automatically converted in 2024 in the alternative form provided by the reform.
& DE BANDT will gladly assist clients to adapt their corporate documentation/ structure to this new Code and advise on how to make best use of the opportunities this new Code will imply. If you have any question, please do not hesitate to contact Astrid de Bandt.