On 20 July 2017 the Council of Ministers approved a legislative proposal regarding a new Companies Code . The current Companies Code was last reviewed fully in 1999. The proposal seeks to modernize Belgian company law by altering or omitting outdated provisions, settling long-lingering points of contention and introducing some important innovations.
Overview of changes
Some significant changes and innovations in the proposal include:
- the abolishment of several legal forms (e.g. CommVA/SCA, CVOA/SCRI);
- the abolishment of the legal distinction between commercial and civil companies;
- the introduction of multiple voting shares;
- the introduction of a cap on the damages regarding director’s liability;
- the transformation of the BVBA/SPRL into a light vehicle company (flexible legal scheme, no capital requirements);
- the redefinition of the CVBA/SCRL as a legal form for companies with a specific purpose;
Significance and impact
Considering the broad and sweeping nature of the changes, the new Companies Code will affect every company in various ways. Therefore, its looming enactment calls for a thorough reassessment of every company’s corporate organization in light of the challenges created and opportunities offered by some of the changes.
In the run-up to the decision by the Council of Ministers, Stibbe Partners Dries Hommez and Jan Peeters were interviewed by the Belgian newspaper De Tijd regarding the significance of the proposed changes (“BVBA wordt nieuwe norm”, De Tijd, 11 July 2017).
The legislative proposal will now be forwarded to the Council of State for its advice before being submitted to Parliament (probably in October 2017). The Chamber is expected to approve the (modified) proposal before the end of the year.
The proposal includes a three-tier transitional scheme that should smooth the implementation of the reforms: as from the entry into force, companies will have five years to amend their articles of association and ten years to convert into another legal form if necessary. However, mandatory rules of law (e.g. the rules regarding the interim allocation of profits) will immediately apply as from the new law’s entry into force.