Belgium: Implementation of the Shareholder Rights Directive

In March the Belgian government adopted a draft bill implementing the Directive 2007/36/EC on the exercise of certain rights of shareholders in listed companies. The Directive entered into force in August 2007 and had to be transposed in national law by August 3, 2009.

The draft bill introduces amendments to the Belgian Companies Code, aimed at improving shareholders’ information rights and enhancing shareholders’ cross-border participation in general meetings of shareholders.

In general, the new provisions will apply to Belgian companies of which the shares are admitted to trading on a regulated market in Belgium or any other EU Member State. The scope of certain provisions has, however, also been extended to non listed companies.

The key provisions in the Draft Bill refer, among others, to the information to be given before meetings which can be posted on company websites. In addition to the basic information the convocations will have to contain, among others, information on the shareholders’ rights, the procedure to appoint a proxy, the procedures for voting by correspondence, etc.

Other provisions describe the terms for convening a general meeting, the identification of the shareholders entitled to attend and vote at a general meeting by setting a record date; the possibility to vote and to participate in the general meeting by electronic means; voting by correspondence; the right to add items to the agenda, if the shareholders, individually or jointly, represent at least 5% of the issued capital; the right to ask questions related to the items on the agenda of the general meeting.

Belgian (listed) companies in the near future will have to amend their articles of association to make them consistent with the new requirements and opportunities offered by the European Directive.

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