Shareholder disputes: your corporate litigation lawyer in Belgium

We assist you and your company in existing or impending conflicts among the owners of the business. We also help you prevent them. That work starts with the articles of association and with the shareholders’ agreement. It ends when the departing party has been paid for its securities.

The Enterprise Court hears the case. Article 574, 1°, of the Belgian Judicial Code gives that court jurisdiction over litigation concerning a company. It also covers conflicts among its former, current or future partners. A former owner therefore faces the same judge as a current one.

For an urgent measure you go to the president of that court. Article 584, third paragraph, lets him rule provisionally in cases he considers urgent. The fifth paragraph, 1°, lets him appoint a sequestrator.

For the securities themselves, Title 7 of the code organises judicial exclusion and judicial withdrawal. Article 2:60 limits that title to private limited companies and to public limited companies. Listed companies fall outside it. Article 2:63 requires 30 % of the votes or of the profit rights for an exclusion in a private limited company.

Withdrawal carries no threshold at all. Article 2:68 lets any holder of securities ask, on serious grounds, that his own securities be taken over. If your company falls outside Title 7, Article 2:73 remains. It lets the president order the dissolution of a company on legitimate grounds, at the request of a shareholder or partner. Where the file conceals a fraud, our page for company directors sets out the approach.

Start with the valuation clause. Articles 2:67 and 2:69 bind the judge only to a clause that specifically covers judicial exclusion or judicial withdrawal. Nor do they bind him where that clause leads to a manifestly unreasonable price. A general formula in the shareholders’ agreement does not meet that test. Without such a clause, the judge values the securities when he orders the transfer.

Then check whether your agreement contains a mediation clause. Article 1725, § 2, of the Judicial Code obliges the judge to suspend the case at the request of a party. That objection has to be raised before any other defence. A party who first pleads on the merits waives it. Paragraph 3 adds that the clause does not prevent a request for provisional or protective measures.

Check the time limits. Article 2:143, § 4, second paragraph, bars an action to annul a decision of a company body after six months. That period runs from the day the decision became enforceable against you, or the day you learned of it. Paragraph 1 gives claims against a director a limitation period of five years. Where the transactions were deliberately concealed, that period only starts on their discovery.

Pay attention to the discharge. Articles 5:104 and 7:157 reserve the minority claim to those who did not validly approve the discharge. Article 2:56, fourth paragraph, releases a director from joint liability for a fault he took no part in. That release requires him to report the fault to all other members of the management body, and the report has to be recorded in the minutes. An oral reservation leaves no trace.

If the file shows that funds were taken out of the company, it becomes a fraud case. We then set up the investigation as described on our page for companies that fall victim to fraud. If you are the one under suspicion as a director, see our page about criminal defence and our page for people suspected of fraud. Fellow lawyers will find the procedure for a referral.

Only from 30 % upwards, and only on serious grounds. Article 2:63 of the Code of Companies and Associations requires 30 % of the votes or of the profit rights in a private limited company. In a public limited company the second paragraph uses 30 % of the votes or of the capital. Article 2:64, third paragraph, forbids the company and its subsidiaries to bring the claim. Article 2:60 excludes listed companies.

Yes, and no threshold applies. Article 2:68, first paragraph, lets any holder of securities ask that his securities be taken over, on serious grounds. They are taken over by the parties those grounds concern. The third paragraph provides that the case continues when the defendant stops holding securities. Article 2:62, § 1, requires the claim to be brought before the president of the Enterprise Court, and the company to be summoned too.

The Enterprise Court. Article 574, 1°, of the Belgian Judicial Code gives it jurisdiction over litigation concerning a company. It also covers conflicts among former, current or future partners about that company. For an exclusion or a withdrawal claim, Article 2:62, § 1, provides that its president sits as in summary proceedings. Paragraph 3 lets him settle the connected claims about loans, current accounts and sureties in the same case.

Five years. Article 2:143, § 1, bars claims against members of the management body five years after the transactions. Where those transactions were deliberately concealed, the period only starts on their discovery. Article 2:56 holds a director liable only for decisions that fall manifestly outside the margin of a normally prudent and careful director. Article 2:57, § 3, removes the liability cap in case of serious fault and of fraudulent intent.

Article 2:143, § 4, second paragraph, bars an action to annul a decision of a company body after six months. That period runs from the day the decision became enforceable against you, or the day you learned of it.

Yes, through court appointed experts in summary proceedings. Article 5:106 requires at least 10 % of the issued shares in a private limited company. The president of the Enterprise Court then appoints experts, who examine the books, the accounts and the transactions of the company bodies. The condition is that there are indications that the interests of the company are seriously at risk. Article 7:160 sets that threshold in a public limited company at 1 % of the votes.

Only after a court confirms it, and only where the mediator is accredited. Article 1733 of the Judicial Code lets the judge refuse that confirmation only where the agreement conflicts with public order. The confirming order then has the effects of a judgment. Article 1728, § 1, makes the documents and the communications of a mediation confidential and inadmissible as evidence. The protocol, the signed agreements and the document that records the failure are not subject to that rule.

Article 1725, § 2, of the Judicial Code obliges the judge to suspend the case at the request of a party. That objection has to be raised before any other defence. A party who first pleads on the merits waives it. Paragraph 3 adds that the clause does not prevent a request for provisional or protective measures.