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GibsonJack Offline

Beiträge: 8

28.11.2023 10:26
Possible business structures of Belgian companies Antworten

The legal structure of your business is among the most important factors that will have a great impact on you and your company throughout its existence. Therefore it is crucial to carefully consider all pros and cons before the incorporation of the company as your choice of the business structure will have a great impact on how you run the business, how you pay taxes and who controls your company. The key is to understand which legal type of entity gives your business the biggest advantages on your journey to achieve the organizational as well as personal goals. Generally, there are four major factors to consider before the start-up process of the company: limitation of personal liability, taxes, ease of share transferability and admission of the new owners and finally – investor expectations.

When incorporating a business in Belgium, there are numerous options for you to choose in terms of the legal structure of your company. Various types of business structures in Belgium are suited for a wide range of business needs. Both – domestic and foreign – investors are able to choose the legal structure that complies best with requirements of a particular business. Additionally, those who decide to register a company in Belgium can enjoy a relatively speedy and straightforward procedure.

Belgium has a wide range of possible types of companies, each with its own advantages and characteristics. While certain business types are more suitable for large companies, other types are developed to meet the needs of small and medium sized companies. Generally, small and medium businesses can benefit from choosing simpler legal form of a business, especially if the company is not planning to be listed on the stock exchange. In order to make the correct choice, entrepreneurs should consider the amount of capital they are planning to invest in the early stage of the business and the shareholders’ obligations associated with each type of business.

Private Limited Liability Company (BVBA/SPRL)
This type of structure is one of the most popular legal entities and is generally used for small and medium businesses that are held privately. Before choosing this type of business structure, investors should take into account that there are certain aspects that make it less flexible in comparison to Public Limited Liability Company. For example, it is not possible to issue neither convertible bonds nor profit certificates, it is also impossible to pay interim dividends. Generally, the main benefits of PLLC are as below:

Only two persons required to incorporate it (there is also an exception, when just one person is needed);
Owners of the company are only responsible for the amount that they have actually contributed;
Relatively small minimum capital.
The required minimum capital is 18,550 EUR; it must be paid in by the founders of the company, who may be private persons or companies, Belgian citizens or non-citizens as well as residents or non-residents of the country. Each issued share needs to be at least 20% paid in before incorporation and the minimum amount is 6,200 EUR. In case a company has only one founder, at least 12,400 EUR needs to be paid in. All shares of this company are nominative and they have to be registered in the shareholders’ register. There are certain restrictions regarding the share transfer.

Public Limited Liability Company (NV/SA)
This type of business is generally selected for larger companies as the minimum capital is significantly higher than for the Private Limited Liability Company. It is also beneficial to choose this type of structure for a business which requires a large amount of capital, as the company will be able to attract external capital. The minimum capital is at least 61,500 EUR and upon incorporation, at least 25% of each share needs to be paid in with a minimum total amount of 61,500 EUR.

Unlike PLLC, the shareholders of Public Limited Liability Company do not play a significant role as at least three directors are required to be appointed to manage the company. If there are only one or two shareholders, it is sufficient to appoint only two directors. If a company is appointed to be a director, according to Belgian corporate law, a permanent representative needs to be appointed.

Following documents and other information are required upon incorporation of Public and Private Limited Liability Companies:

Full details of the founders’ identities;
A financial plan for the first two years;
Bank certificate approving the capital;
Founders’ powers of attorney;
Letter of acceptance from the directors;
Passport copies of the of the directors;
Articles of Association;
Act of incorporation;
Minutes of the first general meeting to appoint directors;
Minutes of the first board meeting for certain business decisions;
Registration with the tax administration;
Registration with the trade registry or filing with the commercial court;
Publication in the Official Journal;
Registration with the social security and VAT administrations.
Limited Partnership (SCS/GCV)
Limited Partnerships have two types of partners with different legal regimes. General partners are jointly responsible for the partnership’s liabilities. General partners are also the ones who manage the company. Meanwhile, limited partners are only responsible for the capital they have contributed towards the Limited Partnership. They also do not acquire a trader’s status and are not involved in the management of the business. There is no requirement for a minimum capital to incorporate a Limited Partnership and also less administrative formalities are required. It still remains less common due to the full liability of general partners.

Other types of business structures in Belgium include:

Cooperative with unlimited liability (SCRI/CVOA);
Cooperative with limited liability (SC/SCRL – CV/CVBA);
General Partnership (SNC/VOF);
Sole Proprietorship.

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