Entering the Market

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The Market

As a magnet for international expansion and investment Belgium punches above its weight. Belgium may rank only 34th among European nations in area but is often seen as being at the heart of the European market with direct access to the European Union’s consumer base. Belgium is a modern industrialized society that depends heavily on foreign trade, especially with its European neighbors. Belgium’s impressive transportation infrastructure provides well-integrated networks linking it to the industrial, commercial, and business centers of Europe. Expansion into a developed economy such as Belgium involves huge challenges – from finding highly qualified staff to complying with strict employment laws and tax and payroll regulations. There are speedier and more cost-effective alternatives, with Bradford Jacobs opening the door to a hassle-free route into Belgium. Work alongside our Professional Employer Organization (PEO) recruitment specialists, then utilize our Employer of Record (EOR) in-country experts to handle every aspect of compliance. Employers can depend on our in-depth knowledge of Belgium and how to navigate its challenging language and legislative issues. Here we have set out some basic summaries of what you need to make the transition into the Belgian market, whichever sector you operate in.

Starting a Business in Belgium

The new Belgian Companies and Associations Code (BCAC), implanted in 2020, restricted the permitted number of company types to four. They are the Partnership, the Limited Liability Company, the Cooperative Company, and the Public Limited Liability Company. The BCAC intends the limited liability company (Besloten vennootschap / Société à responsabilité limiteé, BV/SRL) to be the default company choice as it can be smoothly customized through its Articles of Association and has independent legal status to establish separate liability. This company type replaced the former private limited liability company. Typically, foreign enterprises establishing subsidiaries in Belgium take the BV/SRL option and must then follow set procedures to become operational. Belgium has three legislative areas – Flanders, Wallonia, and Brussels-Capital. Using Flanders as an example, requirements include:

  • Confirm the business entity type for the new subsidiary – the most popular choice is a limited liability company, a BV/SRL
  • Open a bank account – in the company’s name with a financial institution established in Belgium
  • Draw up Articles of Association in the presence of a notary to have them registered with the Commercial Court
  • Publish company documents in the Belgian Official Gazette
  • Obtain enterprise number from the Central Enterprise Databank (BCE/KBO)
  • Official documents have to be translated into Dutch, French or German depending on the legislative region of incorporation
  • Apply for a bank certificate. Under the new BCAC, a minimum amount of capital is not required to incorporate a limited liability company. The bank certificate acknowledges any capital has been deposited in the company’s current account
  • Shareholders are required to show they have sufficient funds for the incorporation
  • Draw up a Memorandum of Association including the financial plan, bank certificate, company audit and company founders’ report
  • Produce financial plan showing projections for two years
  • Register the Memorandum of Association within 15 days and submit an extract, signed by a notary if applicable, at the commercial court registry in the jurisdiction where the head office is based

Once the company is cleared to operate, other responsibilities include:

  • Electronically notifying the National Social Security Office (NSSO) staff have been hired
  • Registering staff with the NSSO at the start and termination of employment
  • Registering with the Tax Office for their region
  • Taking out an industrial insurance policy
  • Nominating a company officer to deal with employment documents and official correspondence with the NSSO and tax authorities
  • In the case of hiring staff from outside Belgium, notifying the NSSO of the start date and anticipated length of employment

Expanding Business into Belgium

Foreign companies expanding into Belgium are entering one of Europe’s key economies. Despite being one of Europe’s smallest nations in land mass, it is often seen as being at the heart of the European market with direct access to the European Union customer base. Belgium has Gross Domestic Product of 579 billion US dollars and more than 140 million consumers within a 500km radius. It is home to powerful decision-making institutions, including European Union commissions in Brussels, the capital, and more than 1,400 governmental and non-governmental international organizations.

This is a modern industrialized society that depends heavily on foreign trade, especially with its European neighbors. Belgium’s impressive transportation infrastructure provides well-integrated networks linking it to the industrial, commercial, and business centers of Europe. Belgium has an ideal location for further expansion into the European market … but has legislative and language issues which erect some business and culture barriers. Incoming companies have to toe the line in terms of compliance with employment laws and Collective Bargaining Agreements that provide unbreakable protections for the workforce. There are other questions too: where will you find distributors, manufacturers, and offices? Before you make your move – speak to Bradford Jacobs.

Belgium Business Facts

  • Capital city – Brussels.
  • The Regions – Wallonia (French spoken) Flanders (Flemish/Dutch spoken) and Brussels.
  • Population – 11.65 million.
  • Official languages – Flemish/Dutch, French, German.
  • Economy and world ranking – GDP €492 (US$579) billion. Ranked 25th in the world ranking for GDP.
  • Leading sectors – services (69%) industrial (20%) and agricultural (1%) of GDP. Also, metallurgy, steel, textiles, chemicals, glass, paper, and food processing are the dominant industries.
  • Main exports – include chemicals, road vehicles, pharmaceuticals, plastics, machinery, and equipment, finished diamonds cultured pearls, mineral oils.
  • Main imports – include mineral fuels and oils, road vehicles, machinery and equipment, chemicals, raw diamonds, pharmaceuticals, nuclear reactors.
  • Main trading partners – Germany, France; Netherlands, UK, USA.
  • Government – a federal, representative democratic, constitutional monarchy. Plays host to NATO.
  • Currency – Euro.

Advantages of expanding into the Belgian economy include:

  • Trade: Among the world’s top exporters with no trade restrictions
  • Business: Established procedures for setting up new entities in an entrepreneur-friendly business environment
  • Logistics: Excellent infrastructure and transport links with coastal and inland ports, airports and extensive rail and road networks providing European and worldwide links
  • Consumers: Culturally diverse population ideal for testing new products and more than 500 million consumers within the EU
  • Location: Close to major production centers and sales markets
  • Global role: International decision-making center with many European and international institutions and over 2,000 multinationals
  • Communications: First class internet and telephone networks
  • Workforce: Highly qualified and multi-lingual

Challenges of entering the Belgian economy:

  • Regulations: Legislative and language complications posed by having three separate regions
  • Economy: Excessively dependent on western Europe business
  • Taxation: High corporate taxes can deter incoming businesses
  • Employment: Strict laws and regulations, particularly for employee dismissals
  • Politics: Brexit complications following departure of the United Kingdom, which is Belgium’s fourth largest trading partner
  • Intellectual Property: Rights apply independently to Belgium’s three legislative regions, meaning companies have to obtain patents and licenses for each