Types of governance

Under the current/former Belgian Companies Code (BCC), companies incorporated as an NV/SA are governed by a board of directors consisting of at least two directors. Under the new Belgian Companies and Associations Code (BCAC), this is still the default rule, but companies incorporated as an NV / SA also have the possibility to opt for (i) the appointment of one director, having the same powers and responsibilities as a board of directors and, if appropriate, benefiting from a veto right, granted in the articles of associations, for any amendment to these articles of association, any distribution and even his or her own revocation or (ii) a two-tier board, whereby the company is managed by a management board (directieraad / conseil de direction) and a supervisory board (raad van toezicht / conseil de surveillance).

Permanent representatives

Under the BCC, a permanent representative had to be chosen amongst the shareholders, managers, directors or employees of the legal entity appointed as director.

The BCAC provides companies with more flexibility as to the appointment of the permanent representative by abolishing the requirement to appoint the permanent representative within these specific groups. The only requirement in place under the BCAC, is that the permanent representative must be a natural person, who cannot personally be appointed as a director in the same company.

The BCAC therefore puts an end to the cascade of permanent representatives and clearly makes it impossible for a natural person to be both director and permanent representative of a legal entity in the same company.

Revocability of directors

The BCAC abandons the public order character of the “ad nutum dismissal” of directors in the NV / SA, meaning that directors could be dismissed without any severance payment or notice period, without any justification and by a simple majority of votes.

The BCAC provides for the possibility to include in the company’s articles of association or the appointment decision a severance payment or notice period in case of the director’s dismissal. Directors representing minority shareholders are thus better protected against immediate dismissal.

However, the abolition of the public order character of the ad nutum dismissal does not affect the company’s ability to terminate a director’s mandate immediately for legitimate reason (e.g. tax fraud).


The BCAC introduces the rule that the board of directors and the supervisory board may unanimously adopt all resolutions in writing, unless otherwise stipulated in the company’s articles of association.

Furthermore, the board of directors and the supervisory board may be authorized by the company’s articles of association to issue internal regulations, setting out the procedural rules of the decision-making process.

Capped liability

In relation to liability of directors, the BCAC aims at finding a balance between responsibility and predictability of the amounts of the liability.

On the one hand, it limits the liability of directors to a fixed amount, varying between EUR 125,000 and EUR 12,000,000 depending on the scope of activities and the size of the company. The cap applies as an aggregate for all directors concerned for claims based on the same fact(s) regardless of the number of plaintiffs, and applies both vis-à-vis the company and third parties. The cap is irrespective of the ground or basis of the liability claim (contractual or non-contractual) but does not exist in case of repeated negligence, gross misconduct, fraudulent intent, specific liabilities to the tax and social security authorities, nor to other specific guarantee liabilities (garantieverplichtingen / obligations de garantie) included in the BCAC.

On the other hand, companies are prohibited to waive any claim against directors in advance and to hold them harmless from liability incurred toward the company or third parties. Companies, however, can subscribe to director liability insurance.

See below for a summary with respect to the liability caps of directors of a company. These amounts in respect of turnover and balance sheet will be indexed following increases or decreases in the consumer price index on 1st January of each year. It should be noted that this liability regime does not only apply to formally appointed directors, but also to de facto directors, defined as those persons who have exercised effective management powers over the company, without being formally appointed.

Liability cap - summary

  Amounts to be calculated as on average over the 3 FY preceding the one during which the claim is made
 (I) 125K Turnover (T): < 350,000 € (excl. VAT); and
Balance Sheet (BST): ≤ 175,000 €
(II) 250K Not (I) but:
T: = < 700,000 € (excl.VAT); and
BST: = ≤ 350,000 €
(III) 1M Not (II) but does not exceed more than one of the following limits
T: = 9M € (excl. VAT)
BST: = 4,5M €
(IV) 3M Exceed the thresholds of (III) but does not meet or exceed the tres. of (v)
(V) 12M T: ≥ 50M € (excl. VAT) 
BST: ≥ 43M €