A foreign company that opens a Belgian branch office must comply with certain publication requirements. However, all too often companies fail to comply with their obligations.
In Belgium, the applicable rules on the publication requirements for branch offices derive from EU Directive 89/666/EEC. Articles 81 to 83 of the Companies Code set forth the documents and information that must be published.
Scope of Application
Articles 81 to 83 are part of Book IV of the code, which is entitled "Common Provisions for All Legal Entities Falling under the Scope of Application of the Code". All companies with legal personality are covered by the code, not merely those with share capital. The question of whether a foreign company in Belgium is regulated by the code for the purposes of publication requirements depends on whether the foreign company has characteristics similar to those of a Belgian company with legal personality.
A distinction can be made between the requirements that apply in respect of the opening of a branch office in Belgium (as determined by Articles 81 and 82), and those that apply throughout the branch office's existence (as determined by Article 83). Article 81 governs the requirements for foreign companies governed by the law of an EU member state, whereas Article 82 applies to foreign companies governed by the law of a state outside the European Union.
Annual and consolidated accounts
Foreign companies with a branch office in Belgium must publish their annual accounts and, if applicable, consolidated accounts in the form in which the accounts are prepared, audited and published under the law of the foreign state to which the company is subject. These accounts must be published annually within 30 days of the general shareholders' meeting(1) and no more than seven months after the end of the company's financial year. The accounts must be filed with the National Bank of Belgium.
A social balance sheet must be attached to the annual accounts, showing data for each of the company's branch offices in Belgium (ie, data about the foreign company's employees). Whether this balance sheet must be prepared in full or in abbreviated form depends on the total size of all of the branch offices in Belgium.
These rules apply irrespective of whether corporate legislation in the company's country of origin requires the company to publish its annual accounts.
Companies governed by the law of an EU member state and are required by national law to publish their consolidated accounts in their country of origin must also file the accounts with the National Bank of Belgium (in addition to their ordinary annual accounts). However, if they are exempt in their country of origin because consolidated accounts have been published at a higher level, the higher-level accounts must be filed with the National Bank of Belgium.
Companies governed by the law of a state outside the European Union must file their general accounts and their consolidated annual accounts in Belgium if they:
- have a legal form similar to that of a company with share capital under EU law;
- control subsidiaries; and
- meet the criteria set in the EU Seventh Company Directive (83/349/EEC) by having:
o an annual net turnover of over €29.2 million;
o a balance sheet of over €14.6 million; and
o over 250 employees on average over the financial year.
Article 85 of the code requires companies to file the necessary documents in one of the official languages of the commercial court in whose jurisdiction the branch office is located. If preparing a translation, it is advisable to use a sworn translator, but this is not mandatory.
The annual accounts and consolidated accounts of foreign companies can be filed on paper or electronically.
Publishing documents and information in the Official Gazette
Article 83 of the code states that a foreign company which is governed by the law of an EU member state and which has a branch office in Belgium must publish modifications to the documents and data referred to in Articles 81(1) to (3) and Articles 81(5) and (6). This requirement covers changes to:
- the company's articles of association (ie, the deed of incorporation or, if the articles have been modified since incorporation, the consolidated text of the articles of association);
- the name and legal form of the company;
- the name of the registration authority;
- the company's registration number;
- the name of the branch office (if different from that of the company);
- the branch office's address;
- the nature of the branch office's business; and
- the identity of a person (i) appointed as the branch office's legal representative(s), or (ii) empowered to bind the company and to represent it in court as a body corporate (eg, a president or a managing director) or a member of the body corporate (eg, a member of the board of directors).
Foreign companies governed by the law of a state outside the European Union must publish modifications to documents and data referred to in Articles 82(1) to (4) and Articles 82(6) to (10). In addition to the above requirements, these articles stipulate requirements in respect of:
- the law governing the company;
- the company's registered office;
- the company's corporate object; and
- the powers of persons empowered to bind the company legally, including an explanation of whether such persons are individually or jointly authorized to do so.
Moreover, if the foreign company's articles of association do not mention the amount of subscribed capital, this amount must be published annually in the Official Gazette.
All foreign companies with a branch office in Belgium must publish an announcement in relation to:
- a decision to liquidate the company, the identity and powers of the liquidator and the decision to conclude the liquidation process;
- insolvency proceedings relating to the company; or
- the closure of the branch office.
Filings must be made within 30 days of the relevant event to the clerk of the competent commercial court. The information will then be published in an annex to the Official Gazette.
The practical implementation and interpretation of these requirements may differ between commercial courts (eg, the need for sworn translations and requirements to present copies of documents or originals). Companies may wish to contact the clerk of the competent commercial court before filing documents or information for publication in the Official Gazette.