Tim Dausy

As of January 1st, 2025, company directors in Belgium are facing significantly increased liability exposure due to the adoption of Book 6 of the New Civil Code. This reform has abolished two long-standing protective principles that previously shielded directors from direct claims by contractual partners of the company they govern.

The article discusses how SMEs can reduce the tax burden on dividend distributions by reserving profits in a liquidation reserve. It discusses the benefits of the asymmetric allocation of this reserve where there is a mixed shareholder profile, enabling different share classes to be created to optimise tax benefits. The Tax Ruling Committee has confirmed that this approach is not considered to be a form of tax abuse. With a timely amendment to the articles of association, companies with mixed shareholder profiles can make the most of the liquidation reserve.

One of the questions we have been asked most often since the introduction of the new Companies and Associations Code (hereinafter referred to as ‘CAC’) on 1 May 2019, is the matter of what corporate form it is most advisable to choose, that of Public Limited Company or Private Limited Company. In this article we shall endeavour to give a brief explanation of the remaining significant differences between the two legal forms.