COMPANY TYPES AND REGISTRATION

A company setting up in Belgium must first decide on the type of company to

establish as well as choosing the corporate form.

Once these decisions have been taken, the company will need to be registered. The
procedures must be completed in the order indicated, as information obtained
during one step may be required to accomplish the next step.

Company type: branch office or subsidiary?

Choosing the corporate form
Registering a branch office
Registering a Belgian subsidiary

A business that wants to establish a presence in Belgium can either set up a

subsidiary company or open a branch office. This choice can have significant legal
and fiscal consequences.

Branch office- COMPANIE NOUA

Whereas a subsidiary is considered a Belgian company, a branch is not treated as a

separate entity of the foreign-based parent company. This means that the parent
company is liable for all the debts and obligations of the Belgian branch office. In
other words, a branch office is just an extension of the foreign parent company; a
branch office has neither stocks nor shares, nor a board of directors.

Due to the legal principal of unity with the foreign head office, the branch office will
be considered a foreign company rather than a Belgian company.

This differentiation may be of importance in areas such as marketing and customs

duty rates which have an influence on pricing.

Advantages:

No minimum capital required to start the business.

No need to go to a notary to create the branch.

Fiscal benefits.

Subsidiary

A subsidiary is a company created and capitalised in Belgium by the parent

company. It has its own board of directors. Hence, the subsidiary and the parent
company are considered to be two separate legal entities.

The liability of a Belgian subsidiary is limited to its own assets.

A Belgian subsidiary is in principle subject to Belgian law, even if the company is
controlled from outside Belgium.

Advantages:

Since a subsidiary and the parent company are considered to be two separate
legal entities, the parent company cannot be held responsible for its
subsidiary.

From a marketing point of view, a subsidiary presents a foreign company as

Belgian or European while a branch office presents the company as foreign.
This could provide more credibility with potential local partners.

Choosing the corporate form

Investors who decide to establish a subsidiary will need to choose the most
appropriate corporate form for the subsidiary. The most common corporate forms in
Belgium are the public stock corporation, the limited liability company and the
cooperative company. An investor can also choose from other legal forms such as
the general partnership, sole proprietorship, joint venture or limited partnership.

Corporate resolutions

Any foreign company that wishes to set up a branch in Brussels must produce an
abstract from the minutes of the Board meeting. The abstract should indicate the
decision to establish a branch in Brussels and the appointment of the person to
represent and act on behalf of the parent company. This person will be considered
the 'legal representative' of the parent company, and shall be responsible for all
activities of the branch, including transactions with third parties and legal matters.

Official documents to notarize and translate

Before opening a branch office in Brussels, the following documents have to be

notarized by a notary from the country of origin and translated into Dutch or French
by a certified Belgian translator prior to publication in the Belgian Official Journal.
Translation is not required when the documents to be submitted are already
available in one of the official languages.

Articles of incorporation/by-laws of the foreign company and subsequent

amendments.

Corporate resolutions: minutes governing the extension of the company in

Belgium and appointing the legal representative, including a description of
the powers delegated to him.
 Certificate of the foreign Register of Commerce confirming the existence of
the company.

Financial documents

The foreign company must also translate the most recent annual accounts of the
parent company in order to register them with the National Bank of Belgium.

Administrative steps

Court of commerce:
The documents listed above must be registered with the Court of Commerce of the
judicial area in which the branch is established. The Court of Commerce will then
take care of the publication in the Belgian Official Journal.

'One stop desk for enterprises':

Subsequently, the branch must go to a recognized one stop desk for enterprises
which will register it in the Crossroads Bank for Enterprises, the official database of
companies.
At the one stop desk for companies the company will also obtain:

An enterprise number.

A VAT number.

EMPLOYMENT
Useful, practical information for an employer, employee or self-employed person.

Salary costs: details on how employees are typically remunerated as well as

on the various schemes for limiting social security contributions or exempting
employers from having to pay them.

Employment contracts: the different types of legally recognised

employment contracts in Belgium, and the implications for both employer
and employee of terminating a contract.

Work permit: the procedures that must be completed by non-EU nationals in

order to apply for a work permit.

Professional card: nationals from countries outside the European Union

who wish to practice their profession in Belgium must apply for a professional
card (license).
 Labour legislation and social security: an employers legal obligations in
Belgium vis--vis employees, as well as how the social security and
healthcare systems work.

SALARY COSTS

Paying an employee

The computation of the salary of an employee is governed by a variety of laws,

regulations and collective bargaining agreements and varies depending on the
industry sector. Payroll agencies exist to assist in carrying out these tasks in
exchange for a reasonable fee.

A white-collar employee is paid per month, usually before the end of the month by
wire transfer. Salaries are usually negotiated on a monthly basis. Most collective
bargaining agreements stipulate that an employee is entitled to a 13th month
additional payment (100% of normal monthly salary), anddouble vacation
pay (an additional payment that is roughly equivalent to 89% of the monthly
salary). Salaries are inflation-adjusted.

An employer can also remunerate an employee using other forms of compensation

better known as benefits in kind. Most of these alternative forms of
remuneration are attractive from a fiscal point of view and enable a company to
reduce its social security contributions.

Benefits in kind can include:

Company car.

Mobile phone.

Computer.

Group insurance.

Pension fund.

Stock options.

Reductions in social security contributions

Various government measures exist to promote employment. The measures limit

social security contributions or exempt employers from having to pay them.

Structural reduction: this general measure reduces the social security

contributions for all employees subject to the Belgian social security scheme.
 Target group reductions: these measures concern particular categories of
employees, namely the first three employees to be hired by an employer,
elderly and young employees, employees who were previously laid off, and
the long-term unemployed. A target group reduction can be combined with a
structural reduction. However, it is not possible to combine two or more
target group reductions. An employer can only apply for one target group
reduction per employee.

The National Social Security Office (ONSS/RSZ) calculates the reductions in the
social security contributions based on a multifunctional declaration submitted by
the employer each quarter. Other measures to reduce social security charges are
linked to reductions in working time.

Types of employment contracts

Contracts may focus on the nature of the work, duration of the contract or
accomplishment of clearly defined tasks.

Nature of the work

Contracts may distinguish between three types of work:

Blue collar workers: perform manual work.

White collar workers: perform intellectual work.

Sales representatives: primarily involves the search for and negotiation with
potential clients.

Fixed-term employment contract

A fixed-term employment contract is one in which the parties agree that the
contract will automatically end at a given point in time. This end date is defined at
the time of hiring. In order to be legally valid, the contract must indicate a specific
date and/or an event which should occur at a set date, after which the parties will
be free of their respective obligations.

There are several consequences of this type of contract:

The contract comes to an end when the defined term has expired, without
either the employer or the worker being required to express any wish to
terminate the contract.
 Should the parties continue to execute the contract after the set expiry date,
the contract will then be subject to the same rules as if the contract was
concluded for an unlimited duration.

In order to be legally valid, such a contract must be concluded in writing prior to the
commencement of the employment. In the absence of a written document, the
contract will be subject to the same rules as a contract of unlimited duration.

Contracts concluded for clearly defined tasks

This type of contract also expires at a definite point in time, but the date is
uncertain, as the contract expires when the task entrusted to the worker has been
completed. At the time of hiring, the subject and the scale of the work to be carried
out are defined precisely enough to allow the worker to determine, during the
execution of the contract, when the contract will end.

This contract is subject to the same formal rules as the fixed term contract.

Contracts of unlimited duration

This type of contract does not specify a fixed term. As the duration of the contract is
not set, either party may in principle decide to terminate it at any time, subject to
notification.

A contract of unlimited duration may be concluded verbally. Nevertheless, some of

the clauses that such a contract may contain are only valid if in writing. A written
document avoids many problems of proof.

Temporary employment contracts

Temporary labour is defined as an activity carried out within the framework of a

labour contract and intended to replace a permanent worker, or to respond to an
extraordinary increase in work, or to carry out exceptional work.

This type of labour contract must be concluded:

For a fixed period.

For a clearly defined task.

To replace a permanent worker within the limits prescribed by law.

In writing, no later than the date when the worker enters into service.

Setting out the reason for replacement.

WORK PERMIT
In order to work in Belgium, EU nationals do not need a work permit. Their identity
card or passport is sufficient to allow them to enter, reside and work in Belgium.
Nationals from Iceland, Monaco, Norway, Switzerland and Lichtenstein are exempt
as well Non-EU
nationals

Residence permit

Non-EU nationals wishing to remain in Belgium for over three months are subject to
a visa requirement. Prior to entering the country, they will have to obtain a
temporary entry visa from the Belgian diplomatic or consular authorities in the
country in which they reside.

The applicant must fulfill the following conditions:

Possess a valid passport.

Have sufficient resources and means for the period he is resident in Belgium.

Be able to prove the purpose of his visit.

Work permit procedures

Non-EU nationals must have a work permit, usually applied for by their potential
employer, in order to be legally entitled to work in the country. Belgium generally
requires you to have a work permit or evidence that your employer has applied for
one on your behalf before you can apply for a residence permit or long-stay visa.

The employer, not the individual, files the work permit application, and before a
permit is granted, the employer must prove that no Belgian or European Union
citizen is able to do the job.

Applications relating to artists, au pairs, specialised technicians and trainees require

slightly different processing.

Types of employment

There are two possible ways for a candidate to be employed with a work permit:

As the direct employee of a Belgian company.

As the employee of a foreign company that is providing services to a Belgian

company. This foreign company must not be a recruitment agency and must
produce a service contract as part of the application. The application must be
made in conjunction with a Belgian accountant who must administer the
payroll of the candidate to ensure that all tax and social security is duly paid.
Those who wish to be self-employed in Belgium must apply for a Professional Card.

Types of work permit

There are three types of work permit in Belgium:

A C permit is valid for only one year, allowing the holder to work for multiple
employers. This is usually issued to migrant agricultural or domestic workers.
C permits generally are not renewable.

A B permit is valid for one employer and runs for one year, after which it can
be renewed (by the same employer, usually for the same job or job
classification). If the worker changes employers, his new employer must
apply for a new B permit. The worker may have to return to his home country
and re-apply for a residence visa before he can start his new job. Once he has
renewed a B permit four or more times, i.e. has lived and worked in Belgium
for five years on the same permit, he can receive an unlimited A permit.

An A permit allows the worker to work for any employer in Belgium for an
unlimited period of time. These permits are issued only to the following
categories of applicant: the spouse of an A permit holder, the non-EU spouse
of a Belgian national, the non-EU spouse of an EU national legally resident in
Belgium, and any foreigner with five years of uninterrupted (legal) residency
in Belgium.

Exemption from the work permit

The main categories of foreign nationals exempt from the work permit requirement
are:

Nationals of a Member State of the European Economic Area (EEA) and their
spouses, their descendants who are under 21 years of age or who are still
dependent on them, relatives in the ascending line who are dependent on
them and their spouses.

The spouse of a Belgian and their descendants who are under 21 years of age
or who are still dependent on them, their dependent relatives in the
ascending line and their spouses.

Foreign nationals in possession of a residence permit.

Foreign nationals authorised or admitted for an unlimited period of time.

People with refugee status in Belgium.

Students staying legally in Belgium to work only during school holidays (the
Christmas holidays, the Easter holidays and the summer holidays).
 Students on training courses, which are required for their studies in Belgium.

Apprentices hired under the terms of an apprenticeship or course contract.

LABOUR LEGISLATION AND SOCIAL SECURITY

This section explains an employers legal obligations in Belgium regarding
registration, insurance and work regulations, as well as payment of salary and social
security contributions. For employees, it explains the share of social security
contribution that they must pay as well as how the healthcare system functions,
especially focusing on the reimbursement of medical costs and on sick leave.

Employer obligations
Registration, insurance and work regulations
In principle, every employer must register with the National Agency of Social
Security (ONSS-RSZ). In most instances, the employer will choose to affiliate with a
payroll agency that will serve as the collection agent for the various federal
agencies (child allowances, health care and pension fund).

One of the important and mandatory obligations of the employer will be to arrange
for an insurance policy covering workplace accidents (which includes coverage for
accidents occurring during travel to and from the workplace).

The employer will also have to establish work regulations and maintain a roster of
employees.

Paying an employee
The computation of the salary of a white-collar employee is governed by a variety of
laws, regulations and collective bargaining agreements and varies across industry
sectors. Payroll agencies exist that assist in calculating and administering payroll in
exchange for a reasonable fee.
A white-collar employee is paid per month, usually before the end of the month by
wire transfer. Salaries are usually negotiated on a monthly basis. Most collective
bargaining agreements stipulate that an employee is entitled to a 13th month
(100% of normal monthly salary) payment, and doublevacation pay (equivalent to
roughly 92% of the monthly salary). Salaries are adjusted annually for inflation.

Social security
Belgian social security legislation consists of specific regulations that provide for
unemployment benefits, pensions, sickness and disability benefits, family and child
allowances, workers compensation for industrial accidents and healthcare. The
payment of social security contributions is compulsory.
Blue and white collar workers pay 13.07% of their gross salary, while employers pay
between 32 and 38% of the gross salary, depending on the sector.

The employers social security contributions are calculated on the gross salary, and
the employer deducts the employees contributions from the gross salary. These are
remitted every three months by the employer to the National Social Security
Agency.

Based on bilateral agreements, some non-EU residents may be exempt from Belgian
social security contributions and can remain subject to the social security system of
their country of origin for a limited period of time.

TAX OVERVIEW
Foreign-owned businesses operating in the Belgian market may be subject to one or
more of three types of taxation: Value Added Tax (VAT), Corporate Income Tax and
Personal Income Tax.

Value Added Tax

(VAT)

Value Added Tax is a tax on goods and services which is paid by the consumer and
which is levied in successive stages, namely on each transaction throughout the
process of production and distribution. At each stage of this process the tax paid on
the inputs can be deducted. Hence only the added value is taxed at each stage.

Taxable transactions

The following transactions are subject to VAT:

The supply of goods and services.

The import of goods into Belgium (coming from a country outside the
European Union).

The purchase in Belgium of goods that originate from another European

Union country.

FINDING A LOCATION
Like many major cities, Brussels economy is primarily service-driven. The
infrastructure of the city suits this economy well, with many high quality office
buildings purpose-built for white collar workers.
Brussels also is a centre of industry, as it has been for over a century. Manufacturing
and the production of goods are concentrated in specific areas and receive strong
support from the Brussels-Capital Region.

Industrial companies and warehouses are largely situated in the urban industrial
zones, made up of the Erasme area (West of Brussels), the North Ring area and the
Brussels harbour zone.

These areas are delineated in the Regional Ground Plan.

The Brussels Regional Development Agency develops and manages industrial

buildings in all these areas. The industrial space is available to companies, under
certain conditions, at very competitive rates.

Five office zones

The Pentagon is the name given to the city centre of Brussels, which is encircled
by a road that has a pentagonal shape. The inner ring is also known locally as the
petite ceinture. The city centre is easily accessible by public transport and contains
the major hotels and large shopping districts. This is where government, big
business and the large financial institutions have their offices.

The North District is a few minutes walk from the city centre. Known as the Le
Quartier Nord, the area around Brussels North Station was targeted for
development ten years ago. The areas around Boulevard Albert II have become a
prime location for the headquarters of large multinational corporations, as well as
Belgian companies.

As Brussels has grown in international importance as the capital of Europe, the

Leopold District, or the European quarter, has expanded exponentially and now
crosses the borders of other neighbourhoods. This is where EU institutions are
housed, as well as embassies and non-governmental organisations.

The Louise District is considered the most posh shopping district in the city and
houses some of the most prestigious businesses in Europe. This long, beautiful
avenue extends from Porte Louise to Bois de la Cambre. Here you will find the most
expensive residential neighbourhood in the city, upmarket department stores, as
well as law firms, PR companies, advertising agencies and other service-orientated
companies.

Other more decentralised areas that suit a company headquarters or regional office,
are spread out primarily along the Boulevard du Souverain, Chause de la Hulpe or
Boulevard du Triomphe.

PUNCTE FORTE
GLOBAL GATEWAY TO KEY MARKETS

A staggering 60% of EU purchasing power lies within a mere 500 km (300 miles) of
Brussels. The city is at the heart of Europe not just politically, but physically as well.
Getting products and services to market from Brussels could not be any easier, as
the city is a hub of well connected roads and modern rail infrastructure.

Other important financial and political centres are easily accessed. Brussels is at the
centre of an ever-expanding European high-speed rail network: Paris is less than 1
hours away, London, Cologne and Amsterdam just two.
Frankfurt is a mere hour by plane and almost every EU
Member State can be reached within three hours or less.

Direct flights also connect the city to multiple

destinations in North America, Asia, the Middle East and
Africa.

Blue chip companies realise the strategic importance of

building their pan-European networks from here. Many,
like Colgate, General Electric, Levi Strauss, Sony and
Toyota, have their EMEA headquarters or sales subsidiaries in Brussels. The beauty
of Brussels is that companies with little or no presence in other European markets
can develop and run their businesses from one central location.

Brussels in brief

60% of European purchasing power within a 500 km radius.

5th largest inland port in Europe. Nearby port of Antwerp is the 2 nd largest port
in Europe.

Brussels Airport: 180 passenger destinations and 80 cargo destinations; daily

non-stop flights to the US; daily flights to China and India.

4 research parks and 30 industrial zones.

Europe has a single market: no customs duties, freedom of movement, trade

and exchange.

"Lying at the heart of Europe, Brussels is a vibrant and important global financial
centre in transaction processing. Euroclears decision to establish itself in Belgium
is based on the countrys stable political environment and labour force, with an
influx of first-rate graduates.

Ignace R. Combes, Deputy Chief Executive Officer, Euroclear

According to the 2011 European Cities Monitor survey, conducted by Cushman &
Wakefield, Brussels remains one of the leading cities in which to do business today.
Brussels major strengths are the availability of qualified staff, easy access to key
markets, the quality of telecommunications, favourable business climate in terms of
tax policies and availability of financial incentives, as well as excellent national and
international transport links.

Cushman & Wakefield, European Cities Monitor 2011

Location

1 London

2 Paris

3 Frankfurt

4 Amsterdam

5 Berlin

6 Brussels

7 Madrid

8 Barcelona

9 Munich

10 Zurich

EXCEPTIONAL QUALITY OF LIFE

Brussels ranks as one of the cheapest and most pleasant cities in Europe to live in
(Mercer Human Resources 2009). This comes as no surprise: the city offers spacious
housing, low rents and affordable residential real estate. Brussels is the second
greenest city in Europe, with numerous gardens and parks only a short walk or drive
away.

Transportation, food and other items were consistently cheaper in Brussels than in
other major business centres in Europe, according to the survey. In fact, the survey
concluded that Brussels was one of the least expensive capitals in Western Europe,
not including the new Member States of the EU.
Municipal data about Brussels
Population: 1 048 491 residents

Density: 6 497 residents / km

Real estate statistics

o Number of sales: 6200

o Average price:

land: 479 382

office or business: 342 950

investment property: 678 718

parking space or garage: 64 081

special property: 732 343

apartment: 352 582

studio flat: 144 027

duplex: 434 409

penthouse: 471 253

ground floor flat: 479 912

loft: 499 144

student flat: 115 150

house: 711 267

villa: 2 042 687

terraced house: 476 900

piano nobile: 476 941

mansion: 1 557 596

property: 1 225 000

 castle: 4 125 000

office: 480 870

business: 349 817

warehouse: 327 500

industrial building: 988 333

retail space: 671 750

o Number of rentals: 5125

o Average price:

office or business: 1 775

investment property: 925

parking space or garage: 171

special property: 1 780

apartment: 1 365

studio flat: 657

duplex: 1 423

penthouse: 1 595

ground floor flat: 1 424

loft: 1 509

student flat: 450

house: 2 786

villa: 3 462

piano nobile: 2 232

mansion: 4 917

office: 3 326

business: 2 091

warehouse: 2 045
 industrial building: 6 700

retail space: 2 300