09 Apr The new Belgian Company Code has arrived
On 4 April 2019, has been published in the Belgian Official Journal the new Belgian Companies and Associations Code (hereinafter referred to as the “Company code”). Its mottos are flexibility, modernization and simplification.
There are now 4 main types of companies:
- The simple partnership, which has no legal personality. However, its two variants, i.e. the general partnership and the limited partnership, both enjoy legal personality.
- The former private company with limited liability (“SPRL” in French and “BVBA” in Dutch) becomes the limited liability company (“SRL” in French and “BV” in Dutch). It has been thoroughly remastered and is envisioned to become the “standard” company.
- The public limited company (“SA” in French and “NV” in Dutch) will probably remain the reference corporate body for large and/or listed companies.
- The new cooperative company (“SC” in French and “CV” in Dutch) will from now on be restricted to companies, which truly have a cooperative purpose. Substantial changes also involve:
- The possibility for a single legal or natural person to set up a limited liability company or a public limited liability company;
- The removal of the minimum capital requirement for setting up a limited liability company or a cooperative company;
- An increased freedom in the organization of the shareholders’ voting rights in limited liability companies and public limited liability companies, in particular via multiple voting rights;
- The introduction of a cap on directors’ liability based on the importance of the company.
Concerning associations, the former classification remains overall quite unchanged. We still have the Non-profit associations (“ASBL” in French and “VZW” in Dutch), the International non-profit associations (“AISBL” in French and “IVZW” in Dutch) and the foundations.
This new Company code will come into force on 1 May 2019 and will henceforth be applicable to all new companies, foundations and associations. Companies whose legal form is about to disappear due to the reform i.e private companies limited by shares, unlimited liability cooperative companies, agricultural companies and economic interest groups, will have to modify their legal form before 1 January 2024. As far as existing companies are concerned, they will have to adapt their statutes in accordance with the new law by 1 January 2024 at the latest. Nevertheless, they shall already have the opportunity to immediately submit to the regulations of the new code as from 1 May 2019, subject to prior amendment of their statutes. In any event, they will be required to comply with the mandatory provisions of the Company code as from 1 January 2020. It might therefore be wise to comply with the new provisions as soon as it comes into force.
The Cairn Legal team.