Corporate governance in times of COVID-19 – Impact on the functioning of board and shareholders meetings in Belgium
We are currently facing uncertain times, and companies must address many challenges: keeping their workforce and customers safe, ensuring business continuity, follow-up on contractual obligations in difficult and unprecedented circumstances, possibly coping with cash flow and liquidity problems, to name but a few.
Updated on 6 May 2020
In many companies, adequate and swift action will be required from the board. COVID-19, and the measures taken by governments in response to the pandemic, may, however, also impact the normal functioning of the board and shareholders’ meetings. Travel restrictions,social distancing quarantines, and other measures will often hinder a physical meeting of the board or shareholders. Not to speak of the fact that some directors or shareholders might become infected by COVID-19.
The below overview outlines the alternatives to a traditional physical board or shareholders’ meeting.
We discuss the general framework offered by the Belgian Companies and Associations Code (BCAC), and touch briefly on the, temporary, enhanced flexibility introduced by the Royal Decree nr. 4 of 9 April 2020, involving measures relating to company and association law in the context of the COVID-19 pandemic (the Royal Decree). More detailed information on the measures introduced by the Royal Decree can be found by clicking here.
We only discuss the principles relevant for private and public limited liability companies (BV/SRL and NV/SA). Furthermore, we do not touch upon the specific rules that apply to listed companies.
Wim Vande VeldePartner Attorney at Law
Wim Vande Velde is a local partner in the Corporate and M&A Practice Group in Belgium. He has extensive experience in national and international M&A transactions for both listed and non-listed companies, as well as in corporate restructuring.T: +32 2 743 43 96 E: [email protected]