The articles of association of all Belgian companies and non-profit associations must be in line with the new Belgian Companies and Associations Code before January 1, 2024. Failure to amend your articles of association appropriately and in due time could result in a director’s liability claim.
The new Code, which came into force in May 2019, rewrote various rules regulating companies, and non-profit associations and foundations. One of its key objectives was to modernize the Belgian corporate landscape and make it more attractive, in particular to foreign investors. An overview of the most important changes can be found here.
Most provisions of the new Code entered into force for existing companies and non-profit associations on January 1, 2020. Nonetheless, many companies and non-profit associations have not yet amended their articles of association, which must be fully compliant with the new legislation before January 1, 2024.
This means that if your company or non-profit association’s articles of association have remained unchanged since January 1, 2020 it is highly likely that you will need to amend them, and this must be done by December 31, 2023 at the latest. And be warned! Notaries are very busy because of the large number of entities that have not yet gone through this process – so make sure that you do not wait too long.
This legal obligation provides you with a good opportunity to carry out an audit of your current governance and rethink it in the light of some of the advantages offered by the new Companies and Associations Code. For example, you may wish to:
- allow for a sole director in the SA/NV company form;
- allow for a sole shareholder in the SRL/BV company form;
- remove limitations on share transfers in the SRL/BV company form;
- make use of the possibility to carry out unlimited commercial activities for non-profit associations; etc.
In addition, it is important to check whether there are non-binding rules in the new Code (i.e., rules which apply unless your articles of association provide otherwise) that you wish to exclude.
For further information, please contact:
Frederik Van Remoortel, Partner, Crowell & Moring
fvanremoortel@crowell.com
