Reform of company rights to attract more enterprises in Belgium

Reform of company rights to attract more enterprises in Belgium

The ministers’ council approved Friday an in-depth reform of the rights of companies and associations. According to Minister of Justice Koen Geens, the new Company Code that he prepared aims at attracting more companies in Belgium by aligning the country with its neighbors.

One of the most visible elements is the decrease of the number of categories of enterprises from 17 to 4. In the future, we will talk about “company,” “private company,” “liability limited company” and “cooperative company”. All of the existing types of companies can be included in one of these categories, pointed out Mr. Geens (CD&V).

One person - and no longer two - will be enough to create a liability limited company or a private company. The government wants in this way to avoid a company from suffering from a disagreement between an entrepreneur and the associate whom he had to find to create his company. However, two persons at least will be necessary to constitute an association.

The capital requirement for the creation of a private company is also abolished. Right now, the entrepreneur must dispose of a capital of 6,200 euros. However, he will have to be able to present a consolidated financial plan and his/her responsibility will be greater when there is an issue.

The administrators’ responsibility will be limited in order to allow the companies to attract more easily competent administrators, who will then be able to ensure themselves more easily.

The new Company Code also ends the real-seat rule. At present, in order to determine which national law is applicable, Belgian legislation looks for the place where the company actually has its headquarters, and not for where it is domiciled according to its statues. The minister believes that this is a significant hindrance for companies. From now on, the statutory seat-rule will prevail.

“We must continue to support and encourage entrepreneurship. To continue to present ourselves as an attractive country when it comes to investing is an absolute necessity; we cannot fall behind because of an inadequate legislation or jurisprudence,” insisted Mr. Geens.

The Brussels Times

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