Paper board meetings under the new Companies Code: are we all on the same page?

Today, the rigid rules on the application of written decision-making in Belgian companies often hinder an efficient functioning of the board of directors. Only if the following conditions are cumulatively met can the board of directors of a public limited company (“NV”) adopt written resolutions:

  • this possibility must be provided for in the articles of association;
  • only in exceptional cases, i.e. when the urgent necessity and the interest of the company so require; and
  • in the event of unanimity among the directors.

The second condition, i.e. that the board of directors can only adopt written resolutions in case urgent necessity would require so, is interpreted in a restrictive way, as a result of which the written decision-making can hardly be applied in the board of directors of Belgian NVs today.

Belgian companies must therefore make use of meeting modalities that allow deliberation between the board members, such as a traditional meeting or teleconference.

 

Long-awaited facilitation

 

With the expected new Companies Code, law makers have now responded to the request of company practice for more flexibility in the decision-making process of the board of directors of Belgian companies.

 

Not only will the condition of “urgent necessity” no longer have to be met, the application of the written decision-making will also be extended to the board of directors of other company forms, such as the private limited liability company (“BVBA” or – under the new Companies Code – “BV”).

 

As long as the articles of association provide for this possibility, the only condition for adopting written resolutions will be unanimity among the directors.

 

When to expect?

 

On 28 February 2019, the text of the new Companies Code finally got voted by the plenary. Despite the delays incurred, the new Companies Code will therefore still be able to enter into force on the initial date, i.e. 1 January 2020.

 

However, after 1 May 2019, newly incorporated companies will be immediately subject to the new Companies Code, while existing companies will be able to opt for the early adoption of this more flexible regime by means of an amendment to the articles of association.

 

If you should have any further questions, please reach out to your EY Law contact person or contact Lieven Bultinck or Jasper Berthels.