Liquidation procedure amended: dissolution and liquidation of a company possible in one deed

The procedure to liquidate companies has been simplified as from 17 May 2012. Under certain conditions companies can be dissolved and liquidated in one deed. This new liquidation procedure relieves the burden of the commercial courts.

The procedure for the liquidation of companies which was introduced in 2006 in the Company Law Code (Law of 2 June 2006, see Belgian Official Gazette 26 June 2006) is very time consuming. The appointment of a liquidator requires since then a judicial homologation and the liquidator received increased reporting obligations. The new liquidation procedure relieves the burden for the commercial courts and deletes some uncertainties (Law of 19 March 2012 amending the Company Law Code on the liquidation procedure and Law of 22 April 2012 amending the Judicial Code on the liquidation procedure of companies, see Belgian Official Gazette 7 May 2012).

Dissolution and liquidation in one deed

One of the uncertainties was the possibility to dissolve and liquidate a company in one deed. Such dissolution and liquidation in one deed is now possible foreseen the following conditions are met:

no liquidator is appointed;

on the statement of assets and liabilities, no liabilities are shown;

all shareholders or partners are present or duly represented in the general shareholders meeting and decide unanimously;

the remaining assets are taken back by the shareholders/partners themselves.

All necessary report should be present: dissolution proposal, report of the board of directors, statement of assets and liabilities which is not older than three months and the report of the supervisory director, auditor or accountant.

“Statement on the status of the liquidation”

The liquidation statement contains amongst others the receipts, expenses and liabilities and states what should still be settled. Clarification is made to when the liquidator should send this statement on the status of the liquidation to the clerk of the court's office. The liquidator sends during the seventh and thirteenth month after the start of the liquidation a liquidation statement, drafted at the end of the sixth and twelfth month of the first liquidation year, to the clerk of the court's office of the commercial court of the legal district where the company is established. As from the second liquidation year, the statement should be sent to the clerk of the court's office annually and added to the company's file. In case of a dissolution and liquidation in one deed (see above), the liquidation statements should not be drafted.

Procedure before the commercial court's President

The unilateral petition to confirm or homologate the liquidator can as from now be signed by the liquidator(s), a lawyer, a notary public or a director/manager of the company. Before the competent organ of the company or a lawyer was to sign the petition. It was the definition of 'competent organ of the company' which created uncertainty.
The petition should be filed with the commercial court's President in case of with the commercial court.
The commercial court's President will now judge within a period of five working days (in stead of 24 hours) after the petition was filed. This term aligns with practice. Different courts meet once a week in order to discuss the petitions. The liquidator is deemed to be confirmed or homologated when the court doesn't judge in due time. There is no sanction if the confirmation is not applied for, but as from now the public attorney and any interested third party can ask the commercial court's President that the  liquidator is replaced, possibly after he has been heard.
The petition should no longer contain a statement of assets and liabilities. This doesn't add anything to the procedure and only triggers extra costs.

Also new is that the appointment decision of the liquidator can contain one or more alternative candidate-liquidators, possibly in order of preference. This is important in case the commercial court's President doesn't confirm or homologates the appointment of the liquidator. In case no candidate meets all requirements, the commercial court's President will appoint a liquidator himself.

The commercial court's President also assesses the acts made by the liquidator between his appointment by the general shareholders meeting and the confirmation by the President. He can annul these acts when they are contrary to the rights of third parties.