Pursuant to the Act of 14 December 2005, all bearer shares, for both listed and unlisted companies, should have been recorded in the issuer's shareholders' register or deposited in a securities account with a financial institution by 31 December 2013. All bearer securities which were not converted by that date were automatically converted into dematerialised form or, if the company's articles of association did not allow for this possibility, into registered form. Since 1 January 2012, a new 1% tax has been applicable to the conversion of bearer shares. From 1 January 2013 until 31 December 2013, the tax was 2%.

In our newsflash of 17 October 2014, we drew your attention to a judgment handed down by the Court of Justice of the European Union (the "CJEU") on 9 October 2014 (CJEU C-299/13 Gielen). In answer to the Belgian Constitutional Court's request for a preliminary ruling of 16 May 2013, the CJEU ruled that the conversion tax is contrary to Directive 2008/7/EC of 12 February 2008 concerning indirect taxes on the raising of capital (the "Directive").

New developments

Yesterday, the Belgian Constitutional Court invalidated the tax as well as Articles 61 to 69 of the Act of 28 December 2011, creating a tax on the conversion of bearer shares further to the Act of 14 December 2005. For the Dutch version of the decision 12/2015 click here, for the French version click here.

Act now!

In practice, the tax is paid either by a financial intermediary (if the bearer shares are converted after being deposited in a securities account) or the issuer (if the bearer shares are converted by the issuing company).

Financial intermediaries and issuers can claim reimbursement of the tax directly from the authority responsible for registration taxes (in Brussels, the Regional Director for VAT and Registration Duties).

Shareholders can file a claim for reimbursement with either their bank or the company to which the tax was paid.