As a rule, each share in a Belgian limited liability company ("N.V./S.A.") or a private limited liability company ("B.V.B.A./S.P.R.L.") carries one vote. These companies have, however, under certain conditions, the possibility to issue a certain number of so-called "non-voting" capital shares.
According to Article 48 of the Belgian Company Law a limited liability company or a private limited liability company can issue "non-voting" shares under the following conditions : (1) the non-voting shares may not represent more than one third of the registered capital of the company.
(2) The holders of non-voting shares must be entitled to a preferential dividend. The amount of this dividend is determined in the charter. It can be equal to a percentage of the nominal or par value of the shares, a percentage of the emission price (including the capital premium) or a percentage of the profit available for distribution. If at the end of the business year, the yearly distributable profits are insufficient to pay all preferential dividends, the unpaid balance of the preferential dividends remains due the following year.
Besides the preferential dividend, the non-voting shareholders are also entitled to a dividend equal to the dividend that is paid to the normal voting (non-preferential) capital shares.
(3) In case of the liquidation of the company or a capital decrease, the contribution in capital and premium of the non-voting shareholders must be reimbursed prior to the reimbursement of the other shareholders.
As a rule, "non-voting" shares carry no voting right at a shareholders' meeting. However, the non-voting shareholders regain their right to vote in certain limited cases enumerated by law (in situations where the rights of the non-voting shareholders could possibly be infringed). This is for instance the case when the shareholders' meeting decides to change the rights of the different classes of shares, to a merger or a split-up, to change the corporate purpose, to transform the company form, to wind-up the company, to decrease the capital, to abolish or reduce the preferential rights, or when no preferential dividend has been paid during the last three years.
Except for the above-mentioned rights non-voting shares have the same characteristics as the ordinary capital shares of the company. Non-voting shareholders can therefor lawfully convene, be present and participate at the Shareholders' Meetings, introduce a minority claim, etc...
The technique of non-voting shares can be used as a measure against hostile take-overs or more in general as a way to attract foreign capital without loosing control over the company.
This article is merely intended to provide general information on the subject matter. It is therefor not a substitute for specialist advice.
De Bandt, van Hecke & Lagae - Brussels. (32-2) 501 94 11
According to Article 48 of the Belgian Company Law a limited liability company or a private limited liability company can issue "non-voting" shares under the following conditions : (1) the non-voting shares may not represent more than one third of the registered capital of the company.
(2) The holders of non-voting shares must be entitled to a preferential dividend. The amount of this dividend is determined in the charter. It can be equal to a percentage of the nominal or par value of the shares, a percentage of the emission price (including the capital premium) or a percentage of the profit available for distribution. If at the end of the business year, the yearly distributable profits are insufficient to pay all preferential dividends, the unpaid balance of the preferential dividends remains due the following year.
Besides the preferential dividend, the non-voting shareholders are also entitled to a dividend equal to the dividend that is paid to the normal voting (non-preferential) capital shares.
(3) In case of the liquidation of the company or a capital decrease, the contribution in capital and premium of the non-voting shareholders must be reimbursed prior to the reimbursement of the other shareholders.
As a rule, "non-voting" shares carry no voting right at a shareholders' meeting. However, the non-voting shareholders regain their right to vote in certain limited cases enumerated by law (in situations where the rights of the non-voting shareholders could possibly be infringed). This is for instance the case when the shareholders' meeting decides to change the rights of the different classes of shares, to a merger or a split-up, to change the corporate purpose, to transform the company form, to wind-up the company, to decrease the capital, to abolish or reduce the preferential rights, or when no preferential dividend has been paid during the last three years.
Except for the above-mentioned rights non-voting shares have the same characteristics as the ordinary capital shares of the company. Non-voting shareholders can therefor lawfully convene, be present and participate at the Shareholders' Meetings, introduce a minority claim, etc...
The technique of non-voting shares can be used as a measure against hostile take-overs or more in general as a way to attract foreign capital without loosing control over the company.
This article is merely intended to provide general information on the subject matter. It is therefor not a substitute for specialist advice.
De Bandt, van Hecke & Lagae - Brussels. (32-2) 501 94 11
