On July 20, 2017, the Federal Council of Ministers approved the draft law for the reform of the companies code. Per 1.5.2019 this law is into force. What will change now right? There are three main important changes.
1. Abolition of the difference between civil and commercial companies
The distinction between commercial companies, which have a commercial purpose (e.g. a construction company), and civil partnerships, which have no commercial purpose (e.g. the practice of two doctors), falls away. All companies, non-profit associations and foundations in the new code are considered ‘ companies ‘. The importance of this is that civil partnerships and NPIs will also be able to apply for bankruptcy. A ‘ right ‘ that so far only is reserved for commercial companies.
2. Inclusion of associations
The name says it all itself: the new ‘ code for companies and associations ‘ will dictate the law for both companies as associations. Not the kind of activities, but the pursuit of profit distribution is after the reformation the only criterion for companies and associations. With an association you are allowed to make a profit, as long as you pay them to a goalless purpose (and not to the founders, directors, members …).
3. Less associations formats
Of all types of companies only four will remain:
1 ° the partnership: attractive because of its simple creation, but riskier because of the personal and unlimited liability. The vof and gcv go on in this form.
2 ° the cooperative: for at least three shareholders, all limited liability.
3 ° the private limited company (bv): the former bvba, especially interesting for small and medium-sized enterprises (no start capital).
4 ° the limited company (nv): for large companies (start-up capital: 61,500 euros).
To the European company and the economic interest grouping was nothing changed, since that falls under European supervision.
Also these changes will enter into force step by step:
- The starting capital in the bv disappears: formerly, the starting capital of a bvba 18,550 euros. In the new bv you’re free to start without any capital.
- ‘One headness’ in the bv and nv: one partner is sufficient, in order to establish a bv or nv. It does not matter anymore if it is a natural person or a legal person (e.g. a company).
- More ‘ openness ‘ in the bv: the bv will be closer to the nv. For example, a bv will be able to transfer shares freely and even get a listing.
- Limit on liability: the liability will be limited, depending on the size, turnover and total assets of your company.
- The right ‘ moves ‘ no longer: a Belgian company that moved its registered office abroad, will also fall under the foreign company law.
What about existing associations?
They will receive a transitional period. They have until 2029 to adjust their statutes to be fully in line with the new corporate law. If they don’t, then their enterprise automatically transformed to the most compliant form.