Insolvency Law at Belgium
In Belgium, insolvency law governs the legal process for companies or individuals who are unable to meet their financial obligations. The primary legislation is found in the Belgian Code of Economic Law (Wetboek van Economisch Recht / Code de droit économique), particularly in Book XX, which deals with the insolvency of enterprises.
Key Aspects of Insolvency Law in Belgium:
1. Types of Insolvency Procedures
Judicial Reorganization (Procédure de réorganisation judiciaire / Gerechtelijke reorganisatie):
Aims to allow companies in financial distress to continue operations and avoid bankruptcy. It may involve:
Amicable agreements
Collective agreements with creditors
Transfer of activities under judicial supervision
Bankruptcy (Faillite / Faillissement):
Declared when a debtor has ceased payments and lost creditworthiness. A court-appointed curator (liquidator) handles the sale of assets and distribution to creditors.
Debt mediation and restructuring for individuals (Règlement collectif de dettes):
Aimed at over-indebted individuals, handled by labor courts.
2. Who Can Be Declared Insolvent?
Companies, sole traders, or any enterprise (as defined in the Code)
Non-profits and liberal professions are now also included under some insolvency provisions
3. Recent Reforms
Law of 11 August 2017 (effective from 1 May 2018): Major reform integrating insolvency law into the Code of Economic Law.
Introduction of preventive restructuring in line with the EU Restructuring Directive (2019/1023), aiming to harmonize restructuring frameworks across EU member states.
4. Central Balance Sheet Office and Register
Insolvency cases and company accounts are published in the Belgian Official Gazette and registered via the Central Business Register (KBO/BCE).
5. Role of the Court and Insolvency Practitioners
Courts oversee insolvency proceedings.
Curators and judicial mandataries are appointed by courts to manage processes and protect creditor rights.
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