29 Sep New decision on the qualification of a company manager as an “enterprise”

In a judgment of 24 May 2022, the Liège Enterprise Court, Namur division, had to examine the criteria for determining whether the manager of a company is to be qualified as an enterprise in the light of the principles set out by the Court of Cassation in its judgment of 18 March 2022.

With this decision, the Court of Cassation seemed to have sounded the death knell for the majority case law according to which the natural person manager was automatically an enterprise. The Court recalled that in order to be considered as such, the manager had to demonstrate a proper organisation consisting of an arrangement of material, financial or human resources with a view to carrying out a professional activity on an independent basis.  However, this is rarely the case for a directors or members of the board who benefit from the organisation put in place by the legal entity that they represent.

On 24 May 2022, the Court of Enterprise, hearing an action by the receiver against a judgment declaring a manager bankrupt, re-examined the notion of enterprise within the meaning of Article I.1, 1° of the Economic Law Code and the judgment of 18 March 2022.

On this occasion, the Court refused to follow the receiver’s argument based on the alleged absence of personal organisation of the manager.  The latter managed his companies alone, his mandates were remunerated, he was subject to the social security regime for self-employed workers, he kept simplified accounts and his remuneration as a director  was the only source of professional income. The court considered that the absence of a computer, mobile telephone or vehicle of his own, as highlighted by the receiver, was not a determining factor in the era of leasing and company cars.

This decision therefore challenges the effects of the decision of the Court of Cassation of March 2022 by (re)opening the door of book XX of the Economic Law Code on the insolvency of enterprises to company directors acting as natural persons.

For more information, please contact Virginie Schoonheyt

The Cairn Legal team