Incorporating public and private limited liability companies (NVs and BVs) or altering their articles of association

Business enterprises can be set up in different legal forms, i.e. with and without legal personality. In the case of enterprises without legal personality, there is no distinction between the capital of the enterprise and that of the entrepreneur. It follows that the entrepreneur remains personally liable for the debts of the enterprise. This is not the case for legal entities, as they are deemed to be separate and independent. If an enterprise has legal personality, the entrepreneur cannot, with some exceptions, be held liable for more than the sum he has contributed to the company’s capital.

Sole traders, partnerships and limited partnerships are examples of business enterprises that are not separate and independent legal entities.

The absence of legal personality is not necessarily a disadvantage for an enterprise. A notary can advise entrepreneurs and explain the legal and tax consequences of the various legal forms.

NVs and BVs are limited liability companies. Most legal entities are BVs (private limited liability companies), whereas NVs are usually large companies with a stock exchange listing. The law requires a notarial instrument for the incorporation of a public or private company. Such an instrument must contain the articles of association. The founders of a BV must pay up a minimum of EUR 18,000 of the share capital, whereas the founders of an NV must pay up EUR 45,000. The founders must be able to demonstrate that they have this sum at their disposal.

Under the new system, the notary is completely responsible for ensuring that articles of association are legally correct, and the supervisory function of the Ministry of Justice is restricted to inspecting the financial and criminal records of the company’s decision-makers.

After the instrument of incorporation has been executed, a copy must be filed in the Commercial Register of the local Chamber of Commerce. This is done in order to give any interested party the opportunity to examine the company’s articles of association and to establish which executive and non-executive directors may represent the company and the extent of their powers. The law stipulates that the company’s directors are jointly and severally liable for the transactions undertaken before the company’s particulars were filed in the Commercial Register. In practice, however, as a notary arranges the first registration, the directors’ liability is restricted to a minimum. The particulars in the Commercial Register must always reflect the current situation. This means that any alterations to the articles or any change of directors or change in the powers of the persons authorised to represent the company must be filed in the Commercial Register.