Belgium collection profile

Visibility on company records is fairly good, and relevant financial information on domestic companies may be obtained through Official Registers since publishing yearly financial results is mandatory for the majority of companies in Belgium. In addition, Allianz Trade cross-verifies the information available with audit firms as well as with solvency reports provided by external providers  in order to allocate each company a grade reflecting its financial health and how it conducts business. Grades represent a core part of our knowledge and analyses, and help clients identify and avoid risk. Data is continuously monitored to offer the most up-to-date information to support management decisions.

Liability for business debts is determined by legal structures, which are described as follows:

• • Sole Proprietorship is commonly relied upon for small-scale operations because it is based on the qualities of the sole proprietor, who personally owns the business assets. As a result, the proprietor is fully liable for the business’ activities and debts.
• • General Partnerships (sociétés en nom collectif/vennootschap onder firma) allow partners to conduct business together but offer different liability thresholds. Unless a Limited Partnership is set up (sociétés en commandite simple/gewone commanditaire vennootschap), indeed, the partners’ liability is joint and unlimited, even if one partner generates business debts without the other partners’ knowledge or consent. The partners establish their liabilities and rights in a specific ‘partnership agreement’ but do not create a separate legal entity. SCRI Cooperative Companies (sociétés coopératives à responsabilité illimitée/coöperatieve vennootschap met onbeperkte aansprakelijkheid) are alternatively made up of multiple partners whose contributions may vary, even though their liability is unlimited.
• • Limited Companies ( Société à responsabilité limitée or SRL /besloten vennootschap or BV) are the ‘basic company form’ par excellence. Because there are very few mandatory regulations, a BV gives economic operators a lot of room to manoeuvre in forming a company that is ‘made to measure’. For example, there is freedom in the articles of association to determine how limited the BV actually is. Only one founder is needed to set up a BV.
• • Public Limited Companies (sociétés anonymes SA/naamloze vennootschap NV) may be constituted by at least one shareholder, usually to create a controlling entity. A minimum capital of EUR 61,500 must be fully invested when incorporating the company.

Procedures in Belgium are regulated by the Judicial Code of October 1967 (as amended). The courts are not bound by a case law system, but precedents nonetheless constitute a significant source of authority. The Court of First Instance is the court with the most extensive powers in both civil and criminal cases. (Tribunal de Première Instance/Rechtbank van Eerste Aanleg). There are  9 Business Courts (Tribunal  de l’Entreprise/ROndernemingsrechtbank), and 163 Justices of the Peace (Juges de Paix/Vrederechter) which rather deal with small  claims not exceeding EUR 5000. The decisions rendered in first instance may be brought before five Courts of Appeals (Cour d’Appel/Hof van beroep) dealing with all civil, commercial and criminal cases.

The Supreme Court (Cour de Cassation/Hof van Cassatie) operates at the highest level together with the Administrative Court (Conseil d‘État/Raad van Staat) and the Constitutional Court,  (Cour Constitutionnelle/Grondwettelijk Hof).

In Belgium, e-invoicing for business-to-business (B2B) transactions becomes mandatory on 1 January 2026, requiring structured e-invoices to be exchanged directly between company software systems via the Peppol network. Invoices must conform to the European standard (EN 16931), and unstructured formats like PDFs will no longer be sufficient. While B2B e-invoicing will be compulsory, e-invoicing for private consumers (B2C) remains voluntary. Non-resident Belgian VAT-registered businesses will not have to comply with the 2026 e-invoicing mandate.

As of March 2014, collection costs cannot be charged as such but may be covered by the penalties as agreed in general terms and conditions or determined by a judge. Interests and penalties can be lowered to the effective collection costs within the framework of an amicable negotiation. As Directive 2011/07/EU is transposed into law, by contrast, creditors should be entitled to receive a flat EUR 40 fee to cover their collection costs, while claiming extra compensation for any other reasonable costs (legal fees, recovery agency fees, etc.) occurred as a result of the debtor’s late payment. 

Retention of Title clauses (RoT) are often relied upon in Belgium. Originally designed in relation to bankruptcy law, they aim to assert existing ownership rights against third parties during bankruptcy proceedings in case of concurrence of creditors. The Law of 11 July 2013 created a legal framework in which RoT provisions are  considered a matter of property law and are incorporated into the Civil Code. A key feature of the framework is the recognition of the so-called ‘lengthened RoT’ which aims at preserving ownership (i) despite the buyer’s manufacturing process (Articles 18-20 of the Civil Code) and (ii) despite the goods being resold. In addition, where the goods are mixed and cannot be identified anymore, the RoT could become a ‘Businesslike Subrogation’ and would be extended to all receivables which replace the charged goods (including indemnity due to destruction, damage, or loss of value).

At this stage, the regulation has however denied validity to ‘all monies clauses’ (enlarged RoT) which aims to retain ownership of all goods supplied to the buyer until the buyer has settled all its outstanding debts with the creditor.

In relation to insolvency proceedings, the law also grants specific protection to creditors through the recognition of a ‘Purchase Money Priority’ over other creditors. This means that, while the issue in insolvency is to obtain payment of a debt against secured creditors enjoying a higher degree of priority over ‘unsecured’ debts, the unpaid seller who has preserved its property through a RoT may be entitled to a ‘super priority’ over other creditors. Behind this measure clearly lies the idea that, without strong privilege, sellers are not motivated to deliver before being paid.

Success in enforcing RoT is unpredictable since the mechanism is very formal and, in practice, compliance with all conditions tends to be inconsistent. Seeking specialized legal advice on the issue is therefore essential.

In Belgium, the most common B2B payment methods include:

• Bank Transfers: This is one of the most widely used methods for B2B transactions. Companies often use SEPA (Single Euro Payments Area) transfers for domestic and cross-border payments within Europe.
• Direct Debit: This is a popular method for recurring payments, allowing businesses to automatically debit funds from a client's account.
• Electronic Payment Platforms: Platforms like PayPal, Stripe, or local solutions such as Bancontact are increasingly used for B2B transactions, especially in e-commerce.
• Trade Credit: This involves extending credit terms to business partners, allowing them to pay at a later date, which is common in many industries.

In Belgium, bills of exchange can still be used in certain industries or for specific types of transactions, particularly where formal documentation of the payment agreement is required. They are often used in international trade, where they serve as a promise to pay and can be negotiated or discounted.

Although courts in Belgium are efficient and reliable, amicable settlement opportunities should always be considered as a strong alternative to formal litigation proceedings. In addition, before starting legal proceedings against a debtor, assessing assets is important as it allows verification as to whether the company is still active and whether recovery chances are favorable. In addition, it is essential to be aware of the debtor’s solvency status: if insolvency proceedings have been initiated, it becomes impossible to enforce a debt (see below).

The IOS procedure for recovering undisputed monetary debts in Belgium has existed since 2016, with a law providing for an administrative process for businesses to obtain an enforceable title without traditional court proceedings. This efficient and time-saving procedure allows companies to recover debts via a bailiff or lawyer without going to court.

The IOS procedure imposes a limitation on the interest and penalty clauses that can be charged, not exceeding 10% of the principal debt. A case qualifies for this procedure when:

• It involves a B2B environment where the debtor is registered in the Belgian Crossroads Bank for Enterprises (KBO).
• The creditor can be a Belgian company or a European company (Netherlands, France, Germany, Luxembourg, Italy, Spain, and Austria).
• The debt must be undisputed and must be overdue (past the due date).
• The debtor must not be bankrupt or undergoing judicial reorganization.

Various options exist when the claim is certain and undisputed. First, bills of exchange left unpaid may be brought to the National Bank to obtain formal recognition (prôtet) and registration of the debtor’s failure to pay in a registry (le Journal des Protêts). A fast track procedure conducted by the Justice of the Peace allows Payment Orders to be obtained for claims below EUR 1,860 (Procédure Sommaire d’Injonction de Payer), however it is hardly used in practice as it is perceived as overly constraining.

When the debtor company has assets in other EU Member States, a European Payment Order procedure facilitating the recovery of undisputed debts (under Regulation EC No 1896/2006) may furthermore be triggered before the Justices of the Peace, the court of first instance or the Commercial Court. In this case, the demanding party may request a domestic court to issue an Order to Pay which will then be enforceable in all European Union countries (except Denmark) without  exequatur proceedings.

If the amicable phase fails or if the debtor questions the claim, the option of starting legal proceedings remains. Formal legal proceedings may commence following a voluntary action of the parties (comparution volontaire/vrijwillige verschijning), or once a Writ of Summons is served to the defendant and the claim has been registered with the court. Legal action thus takes the form of a full lawsuit before the Commerce Tribunal, but these tend to be short, efficient, and fairly inexpensive. If the defendant does not challenge the claim, the courts usually render a default judgment within a month, awarding the amount claimed in the Writ (Article 770 of the Judicial Code). If the claim is challenged, however, the parties may be required to provide briefs while the court establishes a procedural plan for the trial. The court then issues a judgment which only acquires res judicata value (autorité de la chose jugée/gezag van het rechterlijk gewijsde) once it is deemed definitive (i.e., when all appeal venues have been exhausted).

The courts would typically award remedies in the form of damages, specific performance, or any form of declaratory relief, but they are not entitled to award punitive damages. As a general rule, there is no discovery principle in civil proceedings,  which implies that the parties must bear the burden of proving their claims. Proceedings are conducted exclusively in French in Wallonia and in Dutch in Flanders. Both languages are possible in Brussels, according to the circumstances of the case, and German can be used (instead of French) as the language of proceedings in the small German-speaking region. It is worth emphasizing that, as a general rule, the competent court is chosen in accordance with the contract’s general terms and conditions rather than based on the debtor’s language.

Commencing formal litigation proceedings requires possession of various documents, including the general terms and conditions applicable to the claim at stake, copies of invoices and credit notes, a statement of account, and a copy of the first formal dunning letter. Although optional, evidence regarding the order and delivery of the goods and correspondence exchanged with the debtor would also be considered essential.

According to Article 2262 of the Civil Code, commercial claims must be brought to court within ten years (three years in specific circumstances; five years for tort claims) starting from the date the cause of action arose. Beyond this, legal action will not be granted since time limitations are considered a matter of substantive rather than procedural law. Having said this, certain factors (such as starting legal action or formally acknowledging debts) may interrupt the prescription period. Debts owed by public authorities must be brought within five years.

Precautionary measures may be awarded to preserve the creditor’s interests pending a final and enforceable judgment. Indeed, the courts may order protective measures ex parte (without the presence of both parties) before or during the proceedings. These measures can usually be requested through a summary proceeding (action en référé/kortgeding) and will be granted in emergency cases to avoid imminent damage or to protect evidence. The courts would typically order the establishment of an inventory of the debtor’s assets by a notary, but seals may also be placed.

Measures acting as provisional enforcement proceedings may also be ordered while the judgment only has a relative res judicata value (i.e., as long as the judgment may still be appealed and is not final yet).

These would include the seizure of the debtor’s assets (i.e., the debtor retains the right to enjoy the assets but is prevented from selling them) provided that the debt is certain. Sequestration would alternatively deprive the debtor of seized assets, particularly if ownership is disputed by the parties and the status quo must be preserved. Interim and precautionary orders are never definitive or irrevocable.

Debt-related claims above EUR 1,860 brought to the Commerce Tribunal may be appealed before the Court of Appeal, which is competent to consider both questions of fact and law. Decisions rendered in second instance may also be reviewed by the Supreme Court on legal grounds, such as wrong interpretation of the law, failure to follow procedural requirements, or failure to state reasons.

A judgment becomes enforceable once it has become final (i.e., when all appeal venues have been exhausted) and provided that the defeated party has been notified. If the party refuses to execute the decision, the latter may still be enforced by requesting a bailiff to attach the debtor’s movable assets, or by filing for bankruptcy. The direct action (action directe – rechtstreekse vordering) procedure also allows the creditor to obtain payment of a debt through a third party (such as the debtor’s own clients) owing money to the debtor. Enforcement proceedings can be lengthy and relatively expensive, but judgments may be enforced within ten years following the decision (strict statutes of limitations apply).

Proceedings in the first instance may take three months in simple cases, but obtaining a final decision may take longer when the claim is disputed (appeal proceedings lasting on average of two years). In addition, enforcement would usually take an additional year.

There is no significant time or cost difference in Belgium between domestic and international claims.

As a general rule, Belgian law entitles the successful party to receive compensation from the defeated party for its legal expenses, known as ‘Case Preparation Allowance’, as regulated by Royal Decree of 2007.Penalties and debt collection costs may be added to this compensation (a bailiff, for instance, may charge 8% of the debt value), along with award registration costs (3% of the amount, excluding interests). Overall, the cost for undisputed simple claims could reach 10% to 15% of the claim. There are no upfront court fees.

Conditional arrangements where attorneys are not paid upfront but instead receive a fixed sum upon success (no-win-no-pay) are prohibited. However, litigation-funding companies may provide third-party funding, to be repaid as a share of the final award.

Alternative Dispute Resolution methods are common for business- related disputes. In particular, arbitration (regulated under Articles 1676 to 1723 of the Judicial Code) is often viewed as being more efficient than ordinary lawsuits because it offers expeditious, confidential proceedings along with a binding award on the merits. To be enforced, arbitral awards must be recognized by a court of first instance through an exequatur proceeding.

Additional, voluntary and judicial mediation proceedings (regulated under Articles 1724 to 1737 of the Judicial Code) are increasingly used as a means to help the parties reach a compromise. Settlement arrangements obtained through mediation would then be considered as contracts rather than as awards. As such, they become enforceable upon failure of the parties to respect their commitments provided that the agreement has been homologated by the court.

Finally, if the parties have agreed in writing on an ADR, the court shall stay the proceedings until the negotiations have had a chance to succeed.

Foreign forums are rather uncommon for debt-related disputes in Belgium because domestic courts are efficient in providing timely decisions. Nonetheless, Belgium is a signatory to the Rome I Regulation on the law applicable to contractual obligations, which stipulates that the parties to a contract may, by mutual agreement, choose the law applicable to the contract, and select the court that will have jurisdiction over disputes. Therefore, Belgium commonly admits foreign jurisdiction provisions and foreign traders may agree to resolve their business disputes in a foreign forum (i.e., under a foreign law or before a foreign court). Typically, domestic courts would however tend to retain exclusive jurisdiction over areas of law possibly impacting public policy.

Furthermore, it is essential that the agreement be characterized by an international connection (for example, one party has elected domicile in another country, or the place of execution is located abroad), and that a jurisdiction clause is specifically drafted for this purpose. It is recommended to always seek legal advice.

As previously mentioned, having foreign forums in order to obtain enforceable decisions against domestic debtors is rather unusual since domestic courts are efficient, and because such proceedings may take time. Nonetheless, foreign decisions issued against foreign debtors owning assets in Belgium may be recognized and enforced in Belgium provided that various criteria are observed, as different circumstances may apply. On one hand, decisions rendered in an EU country would benefit from particularly advantageous enforcement conditions. Apart from EU Payment Orders which are normally enforceable directly in domestic courts, the two main methods of enforcing an EU judgment in Belgium are by the use of a European Enforcement Order (EEO, as provided under Regulation EC No. 805/2004) when the claim is undisputed, or by registering the judgment under the provisions of the Brussels I Recast Regulation (1215/2012).

If the judgment qualifies as an uncontested claim, it can be enforced directly (i.e. without registration) by use of an EEO provided that the debtor has identified assets in the country. A European Small Claims Procedure (as provided by Regulation EC 861/2007) aiming at eliminating intermediate steps may similarly be relied upon while enforcing decisions up to EUR 5,000. This procedure intends to improve access to justice by simplifying cross-border small claims litigation and reducing costs.

If the claim is disputed, the procedure for registering an EU judgment with domestic courts is relatively simple. The judgment holder must apply to the relevant court for the judgment to be registered and provide the court with, among other documents, an authenticated copy of the judgment, a certified translation and, if interest is claimed, a statement confirming the amount and rate of interest at the date of the application and going forward. Once the judgment has been registered, it can be enforced as if it were issued by domestic courts (according to the Recast Regulation EC 1215/2012, such an exequatur procedure is no longer required from January 2015).

On the other hand, judgments rendered in foreign countries outside the EU would also be recognized and enforced through exequatur proceedings, as planned under treaty terms or in accordance with the Code of Private International Law (Articles 22 to 25). The courts would typically consider whether the decision was issued in a country with which a Reciprocity Agreement in recognition and enforcement has been signed (Austria, France, Germany, the Netherlands, and Switzerland). The courts would verify that the decision is final and enforceable in the issuing country, that both parties benefit from a due process of the law before the issuing tribunal and that enforcement would be compatible with Belgian public policy.

Belgium is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958. Therefore, domestic courts also recognize and enforce decisions rendered through international arbitration proceedings.

By law, a debtor who is no longer able to pay their debts as they fall due, and who is unable to obtain further credit is deemed insolvent. The Belgian insolvency framework continues to evolve, with ongoing efforts to enhance the protection of creditors and improve the efficiency of restructuring processes.

The Belgian Parliament adopted the 2009 Law on the Continuity of Undertakings (loi relative à la continuité des entreprises/wet betreffende de continuïteit van de ondernemingen) which aims to support business in avoiding bankruptcy by fostering the recovery of companies facing financial difficulties. This law has replaced the 1997 law on judicial composition (wet betreffende gerechtelijk akkoord/loi relative au concordat judiciaire) and the mechanism it created is increasingly relied upon. The Insolvency Law was fully revised in 2018. In context of the European Directive 2019/1023 implementation, the Judicial Reorganization by Way of Amicable Agreement was added as an out-of-court possibility. T.The most recent and important update is the Law of 7 June 2023, which entered into force on 1 September 2023. This law transposes Directive 2019/1023 into Belgian law but also introduces several substantial reforms beyond the Directive’s requirements.

Key changes introduced by the Law of 7 June 2023 include:

•  Distinction between SMEs and large companies: Different restructuring procedures now apply depending on the size of the enterprise, with lighter procedures for SMEs and more complex rules (including creditor class voting and cram-down mechanisms) for large companies.
• Private reorganisation procedures: Debtors can now opt for confidential, non-public reorganisation proceedings, allowing for more discreet negotiations with creditors.
• Creditor and equity holder classes: For large companies, creditors and equity holders must be divided into classes for voting on restructuring plans, with separate majorities required in each class. This addresses the previous lack of class-based voting and better protects vulnerable creditors
• Expanded role for the Chamber for Companies in Difficulty: This body now has greater powers to assist debtors in early intervention and negotiation with creditors, including the appointment of restructuring experts.
•  Pre-packaged bankruptcy (“silent bankruptcy”): New procedures allow for the confidential preparation of bankruptcy to preserve enterprise value.
•  Revised transfer of undertakings: The transfer under judicial authority is now considered a liquidation rather than a reorganisation, following recent European case law.

A judicial reorganization through collective agreement, a pre-bankruptcy moratorium, exists with a view to safeguarding the continuity of part or all of the assets or activities of the enterprise. The procedure will be initiated if the continuity of the enterprise is at risk.

The company can enter into an agreement with all, or two or more, of its creditors in respect of its indebtedness. This differs from a normal amicable agreement, as there is supervision and assistance from a delegate judge and a judicial mandate. The agreement is also not registered with the court, but accepted by the court and published in the Belgian Official Gazette.

Under this procedure, the company presents a reorganisation plan to its creditors, who then vote on the plan. The plan must contain a proposition to reorganize the company. The plan must have a descriptive section which sets out the difficulties of the company, and a section that provides for possible solutions. The plan can provide for instalment periods, debt reduction and conversion of debt into equity. The plan can also provide for the transfer of all or part of the business of the company and for the suspension of the enforcement rights of privileged creditors for a duration of 24 months (which can be extended for an additional 12 months). The duration of the plan cannot exceed five years. The company must provide a list of its creditors to the court, which will verify the list and, upon the report of the delegate judge, determine who the creditors of the company are and the amount of their claims (the “creditors in suspension”). During the suspension period, the court can, at the request of the company or one of its creditors, decide to alter the list of creditors in suspension or the amounts of their claims.

The plan is approved if at least half of the creditors in suspension representing at least half of the total indebtedness of the company agree to the reorganization plan. The holders of special privileges or security interests (such as pledgees or mortgagees) must give their individual consent if their rights are affected by the plan.

The court can refuse to approve the plan only if the provisions of the Continuity Act were not respected or if the plan violates public policy. The court can also allow the company to submit an adjusted reorganisation plan to the creditors. The decision of the court is published in the Belgian Official Gazette. Disputed claims that are judicially recognised after the approval of the plan by the court will be treated in the same manner as similar claims of creditors in suspension. If the company complies with the provisions of the plan, it will be released from all claims of the creditors in suspension.

The debtor must file for bankruptcy (faillissement/faillite) when it has permanently ceased making payments or when the creditors’ confidence has been lost (undermined creditworthiness), but creditors alone cannot initiate the proceedings. If petition is granted, the creditors must register their claims within a timeframe prescribed in the court’s insolvency declaration (one year as a maximum) as published in the Official Gazette. Since 2017 all declarations and communications in context of an insolvency procedure is done digitally on the government-created digital platform REGSOL.

Failure to register claims typically cancels a creditor’s priority rights and bars entitlement to future proceeds. The President of the Commercial Court, as sole judge, then appoints a trustee or official receiver (curateur/curator) in charge of verifying the claims and of formulating an opinion as to the recoverability of the debt in the 7th and 13th month regarding the previous six months. The proceeds’ distribution plan can then be filed by the trustee/receiver, an attorney, the notary, or a director or manager of the company.

It should be noted that the law of 19 March 2012 (amending the Companies Code) and the law of 22 April 2012 (amending the Judicial Code) have allowed voluntary liquidation upon the unanimous vote of all the shareholders, without appointing a trustee/receiver. The procedure for voluntary liquidation in Belgium was updated by the Code des sociétés et des associations (CSA)/ Wetboek van vennootschappen en verenigingen (WVV), which entered into force on 1 May 2019 for new companies and became fully applicable to all companies as of 1 January 2020.

Unsecured creditors may enforce their rights as long as no insolvency proceedings have been opened. Once insolvency proceedings commence, the debtor’s assets are divided among creditors, giving respective priority to secured creditors and statutory creditors. Public creditors (such as those related to tax and social security) are considered as statutory creditors and would thus have priority over unsecured debts, which in practice would be unlikely to recover their due. RoT holders would be considered as secured creditors but would only have a privilege on a specific good outside the assets pool.

In addition, the trustee/receiver may cancel various types of transactions concluded over the last six months preceding the insolvency proceedings (suspect period). For instance, any fraudulent transactions aimed at favouring one creditor over the others, at reducing the value of the debtor’s estate, or any unbalanced deals (improper prices, unfair loans) would typically be void.

It is impossible to determine precisely how long reorganization proceedings might last, as this depends largely  on specific agreements between debtors and creditors. Suspension of Payment may last for 18 months, while reorganization plans are limited to five years. Liquidation proceedings tend to be fairly quick (about a year), but can be lengthy (up to ten years) depending on the complexity of the case.