Key regulatory developments in Belgium

Home
Knowledge
EU Banking & Finance Regulatory Newsletter
EU Banking and Finance Regulatory Newsletter - May/June 2021
Key regulatory developments in Belgium

Key regulatory developments in Belgium

{8886F9D6-B951-439A-9AD1-5B734C13D109}

July 9, 2021

Source/Date	Brief description
Announced developments May 2021	Draft law transposing the following European Directives into Belgian legislation: CRD V (Directive (EU) 2019/878 of 20 May 2019); Directive (EU) 2019/2034 of 27 November 2019 on the prudential supervision of investment firms; BRRD II (Directive (EU) 2019/879 of 20 May 2019); and Directive (EU) 2019/2177 of 18 December 2019 amending Solvency II Directive, MiFID II Directive and the AMLD4. For further information in Dutch, click here. For further information in French, click here.
Announced developments May 2021	Draft law transposing and implementing the following European Directives and Regulations into Belgian legislation: Directive (EU) 2019/1160 of 20 June 2019 on cross-border distribution of collective investment undertakings; Directive (EU) 2019/2177 of 18 December 2019 amending Solvency II Directive, MiFID II Directive and AMLD4; Regulation (EU) 2019/2088 of 27 November 2019 on sustainability related disclosures in the financial services sector (SFDR); and Regulation (EU) 2020/852 of 18 June 2020 on the establishment of a framework to facilitate sustainable investment (SFTR). For further information in Dutch, click here. For further information in French, click here.
FSMA 12/05/2021	Implementing ESMA guidelines FSMA has published information on several MIFID II aspects in relation to the requirements for a compliance function.
FSMA 05/05/2021	FSMA’s public consultation on proposed minimum standards for the structuring, information disclosure and trading in SPACs on Euronext Brussels FSMA has drawn up four measures governing the structure of Special Purpose Acquisition Companies (SPACs) as well as information disclosure and the trading of SPAC shares. The FSMA takes the view that the investment decision regarding a combination is to be taken by the general meeting of the shareholders (votes in each category a quorum of 50% and a majority of 50% plus one vote), and not by the SPAC’s board of directors. If the founders/sponsors have an investment opportunity outside the SPAC, that investment proposal must be made first of all to the SPAC. If the acquisition of a company related to the sponsors is under consideration, a unanimous decision by the directors who are not in conflict of interest should be required to propose the acquisition to the general meeting. The general meeting will then vote on the basis of the rules on the quorum and majority set out above. Lastly, the SPAC will have to adopt a strict dealing code, which prohibits the sponsors from trading in securities on the stock exchange during the period when the business combination is being negotiated. The SPAC’s redemption option must offer investors who choose to retain their shares maximum protection against dilution. The SPAC prospectus must comprise various dilution scenarios and indicate what level of return is needed to neutralize the investor’s dilution. SPAC shares listed on Euronext Brussels will have to carry a notice that they are reserved for professional investors.
Parliament 19/04/2021	Draft Act containing various provisions of financial law The draft Act contains several provisions that aim to regulate matters that fall within the competence of the National Bank of Belgium (NBB), the FSMA and the Minister of Finance. The draft Act contains on one hand a limited number of autonomous provisions, and on the other hand, a large number of changes to the existing legislation. One of the most important changes is Title 3, which adapts the supervisory laws for the banking and financial sector to the new provisions of the Belgian Code of Companies and Association and implementing the Directive 2019/2177 of the European Parliament and the Council of 18 December 2019 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II). Title 5 enables market participants to take advantage of certain new technologies in a secure way, without this implying that a new category of legislative instruments is being created. For further information in Dutch, click here. For further information in French, click here.
Parliament 07/04/2021	Draft Act containing financial provisions on the prevention of fraud, in particular the obligation to flag special tax mechanisms to financial supervisory authorities This draft Act aims to implement certain provisions of the special commission on ‘international fraud/ Panama papers’, the special parliamentary commission on the bankruptcy of the Optima Bank NV and certain sessions of FinCenfiles. In particular changes are made to the Anti-Money Laundering Act of 18 September 2017 that obliges the entities subject to the Act to report any inconsistencies with the UBO register. For further information in French, click here. For further information in Dutch, click here.
Parliament 02/04/2021	Draft Act implementing a duty of vigilance and reparation on undertakings operating in Belgium To avoid economic abuse of power, the draft act suggests imposing on enterprises a duty of care and accountability with regard to human rights, labor rights and environmental rights across their value chain. For further information in French, click here. For further information in Dutch, click here.
FSMA 01/04/2021	Guidelines implementing ESMA guidelines on the disclosure requirements under the Prospectus Regulation For further information in French, click here. For further information in Dutch, click here.
Minister of Justice 26/03/2021	Changes in the Act amending Book XX of the Code of Economic Law and Code of Income Taxes dated 1992 Changes include: A pre-pack reorganization is facilitated by creating a discrete phase to reach a “preparatory agreement”. A judicial trustee is appointed to assist in the negotiations with key creditors or all creditors when appropriate. Once the required amicable agreement or reorganization plan has been agreed, the silent preparatory phase passes into a public reorganization procedure to obtain the homologation from the court under the usual rules of the judicial reorganization. Access to the judicial reorganization procedure has been made easier and missing documents can be filed at a later stage The tax inequalities of the debt reduction between the different judicial reorganization systems have been deleted. Although these changes result in a change of Book XX of the Code of Economic Law, they only remain in effect until June 30, 2021. At that date, the EU Directive on Restructuring and Insolvency 2019/1023 of 20 June 2019 must be implemented in Belgian law, whereby it is expected that the pre-pack reorganization and easier access to the procedure shall become permanent features of the Belgian insolvency legislation.
FSMA 17/03/2021	MiFID Work Program for Product Governance Regulated companies that produce or sell financial instruments must meet the MiFID II requirements as regards product governance. These rules differ depending on the role played by the companies in this area. The work program gives an overview of the legislation and regulations applicable to product governance. For further information in English, click here.
Parliament 23/02/2021	Draft Act screening foreign investment having an impact on security interests and strategic sectors This draft Act aims to introduce a screening mechanism for direct foreign investments that affect Belgium’s security interests and strategic sectors. For further information in French, click here. For further information in Dutch, click here.
Minister of Finance/ Official Gazette February 2021	Law on Annual Tax on Securities Account The tax is an annual tax on the holding of a securities account, levied at the rate of 0.15% on the average value of the account in excess of €1,000,000. Three exemptions are foreseen in order to prevent double taxation and to preserve Belgium’s participation in the professionally developed international system of securities transactions, in a way that effectively aims at the legal conversion of an indirectly held securities account: The tax does not apply to securities accounts held as “technical working instruments” by: the National Bank of Belgium; the European Central Bank and foreign central banks exercising similar functions; a central securities depository; a credit institution; a brokerage company; an investment firm; an alternative investment fund manager (AIFM); an undertaking for collective investment in transferable securities (UCITS) management company; an insurance undertaking; a reinsurance undertaking; an institution for occupational retirement; a pension institution operating pension schemes which are considered to be social security schemes as well as any legal entity set up for the purpose of investment of such schemes; an alternative investment fund (AIF); a UCITS; a central counterparty. The tax does not apply to securities accounts held, “for the purpose of using the special services relating to the settlement of securities transactions”, directly or indirectly, and exclusively for its own account, by a non-resident which does not allocate these securities accounts to a Belgian establishment, with a central securities depository or with a custodian bank; The tax does not apply to a “chain of depositories”, i.e. securities accounts held, for the account of third parties, by a financial intermediary, to cover financial instruments recorded in securities accounts in its books or to cover rights held by an excluded institution, entity or company referred to under the first exemption above, with another intermediary or with a central securities depository. That way, the tax is expected to remain neutral with regard to the chain of depositories, where the securities held by investors on their securities account with the bank are themselves held on the account held by the bank with a central securities depository (or not) which, for various securities that it does not “keep” itself, guarantees via its own securities account with the actual “depositary” of the securities. More information can be found on this Link (French).
Febelfin 04/02/2021	Agreement regarding the moratorium on the suspension of payment Banks and the sector organization under the supervision of the Minister of Finance have agreed on an extension of the existing temporary support package system in place since March 2020. For further information in Dutch, click here. For further information in French, click here.

Source/Date

Brief description

Announced developments

May 2021

Draft law transposing the following European Directives into Belgian legislation:

CRD V (Directive (EU) 2019/878 of 20 May 2019);
Directive (EU) 2019/2034 of 27 November 2019 on the prudential supervision of investment firms;
BRRD II (Directive (EU) 2019/879 of 20 May 2019); and
Directive (EU) 2019/2177 of 18 December 2019 amending Solvency II Directive, MiFID II Directive and the AMLD4.

For further information in Dutch, click here.

For further information in French, click here.

Announced developments

May 2021

Draft law transposing and implementing the following European Directives and Regulations into Belgian legislation:

Directive (EU) 2019/1160 of 20 June 2019 on cross-border distribution of collective investment undertakings;
Directive (EU) 2019/2177 of 18 December 2019 amending Solvency II Directive, MiFID II Directive and AMLD4;
Regulation (EU) 2019/2088 of 27 November 2019 on sustainability related disclosures in the financial services sector (SFDR); and
Regulation (EU) 2020/852 of 18 June 2020 on the establishment of a framework to facilitate sustainable investment (SFTR).

For further information in Dutch, click here.

For further information in French, click here.

FSMA

12/05/2021

Implementing ESMA guidelines

FSMA has published information on several MIFID II aspects in relation to the requirements for a compliance function.

FSMA

05/05/2021

FSMA’s public consultation on proposed minimum standards for the structuring, information disclosure and trading in SPACs on Euronext Brussels

FSMA has drawn up four measures governing the structure of Special Purpose Acquisition Companies (SPACs) as well as information disclosure and the trading of SPAC shares.

The FSMA takes the view that the investment decision regarding a combination is to be taken by the general meeting of the shareholders (votes in each category a quorum of 50% and a majority of 50% plus one vote), and not by the SPAC’s board of directors. If the founders/sponsors have an investment opportunity outside the SPAC, that investment proposal must be made first of all to the SPAC. If the acquisition of a company related to the sponsors is under consideration, a unanimous decision by the directors who are not in conflict of interest should be required to propose the acquisition to the general meeting. The general meeting will then vote on the basis of the rules on the quorum and majority set out above. Lastly, the SPAC will have to adopt a strict dealing code, which prohibits the sponsors from trading in securities on the stock exchange during the period when the business combination is being negotiated.
The SPAC’s redemption option must offer investors who choose to retain their shares maximum protection against dilution.
The SPAC prospectus must comprise various dilution scenarios and indicate what level of return is needed to neutralize the investor’s dilution.
SPAC shares listed on Euronext Brussels will have to carry a notice that they are reserved for professional investors.

Parliament

19/04/2021

Draft Act containing various provisions of financial law

The draft Act contains several provisions that aim to regulate matters that fall within the competence of the National Bank of Belgium (NBB), the FSMA and the Minister of Finance. The draft Act contains on one hand a limited number of autonomous provisions, and on the other hand, a large number of changes to the existing legislation.

One of the most important changes is Title 3, which adapts the supervisory laws for the banking and financial sector to the new provisions of the Belgian Code of Companies and Association and implementing the Directive 2019/2177 of the European Parliament and the Council of 18 December 2019 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Title 5 enables market participants to take advantage of certain new technologies in a secure way, without this implying that a new category of legislative instruments is being created.

For further information in Dutch, click here.

For further information in French, click here.

Parliament

07/04/2021

Draft Act containing financial provisions on the prevention of fraud, in particular the obligation to flag special tax mechanisms to financial supervisory authorities

This draft Act aims to implement certain provisions of the special commission on ‘international fraud/ Panama papers’, the special parliamentary commission on the bankruptcy of the Optima Bank NV and certain sessions of FinCenfiles.

In particular changes are made to the Anti-Money Laundering Act of 18 September 2017 that obliges the entities subject to the Act to report any inconsistencies with the UBO register.

For further information in French, click here.

For further information in Dutch, click here.

Parliament

02/04/2021

Draft Act implementing a duty of vigilance and reparation on undertakings operating in Belgium

To avoid economic abuse of power, the draft act suggests imposing on enterprises a duty of care and accountability with regard to human rights, labor rights and environmental rights across their value chain.

For further information in French, click here.

For further information in Dutch, click here.

FSMA

01/04/2021

Guidelines implementing ESMA guidelines on the disclosure requirements under the Prospectus Regulation

For further information in French, click here.

For further information in Dutch, click here.

Minister of Justice

26/03/2021

Changes in the Act amending Book XX of the Code of Economic Law and Code of Income Taxes dated 1992

Changes include:

A pre-pack reorganization is facilitated by creating a discrete phase to reach a “preparatory agreement”. A judicial trustee is appointed to assist in the negotiations with key creditors or all creditors when appropriate. Once the required amicable agreement or reorganization plan has been agreed, the silent preparatory phase passes into a public reorganization procedure to obtain the homologation from the court under the usual rules of the judicial reorganization.
Access to the judicial reorganization procedure has been made easier and missing documents can be filed at a later stage
The tax inequalities of the debt reduction between the different judicial reorganization systems have been deleted.

Although these changes result in a change of Book XX of the Code of Economic Law, they only remain in effect until June 30, 2021. At that date, the EU Directive on Restructuring and Insolvency 2019/1023 of 20 June 2019 must be implemented in Belgian law, whereby it is expected that the pre-pack reorganization and easier access to the procedure shall become permanent features of the Belgian insolvency legislation.

FSMA

17/03/2021

MiFID Work Program for Product Governance

Regulated companies that produce or sell financial instruments must meet the MiFID II requirements as regards product governance. These rules differ depending on the role played by the companies in this area.

The work program gives an overview of the legislation and regulations applicable to product governance.

For further information in English, click here.

Parliament

23/02/2021

Draft Act screening foreign investment having an impact on security interests and strategic sectors

This draft Act aims to introduce a screening mechanism for direct foreign investments that affect Belgium’s security interests and strategic sectors.

For further information in French, click here.

For further information in Dutch, click here.

Minister of Finance/ Official Gazette

February 2021

Law on Annual Tax on Securities Account

The tax is an annual tax on the holding of a securities account, levied at the rate of 0.15% on the average value of the account in excess of €1,000,000.

Three exemptions are foreseen in order to prevent double taxation and to preserve Belgium’s participation in the professionally developed international system of securities transactions, in a way that effectively aims at the legal conversion of an indirectly held securities account:

The tax does not apply to securities accounts held as “technical working instruments” by: the National Bank of Belgium; the European Central Bank and foreign central banks exercising similar functions; a central securities depository; a credit institution; a brokerage company; an investment firm; an alternative investment fund manager (AIFM); an undertaking for collective investment in transferable securities (UCITS) management company; an insurance undertaking; a reinsurance undertaking; an institution for occupational retirement; a pension institution operating pension schemes which are considered to be social security schemes as well as any legal entity set up for the purpose of investment of such schemes; an alternative investment fund (AIF); a UCITS; a central counterparty.
The tax does not apply to securities accounts held, “for the purpose of using the special services relating to the settlement of securities transactions”, directly or indirectly, and exclusively for its own account, by a non-resident which does not allocate these securities accounts to a Belgian establishment, with a central securities depository or with a custodian bank;
The tax does not apply to a “chain of depositories”, i.e. securities accounts held, for the account of third parties, by a financial intermediary, to cover financial instruments recorded in securities accounts in its books or to cover rights held by an excluded institution, entity or company referred to under the first exemption above, with another intermediary or with a central securities depository.

That way, the tax is expected to remain neutral with regard to the chain of depositories, where the securities held by investors on their securities account with the bank are themselves held on the account held by the bank with a central securities depository (or not) which, for various securities that it does not “keep” itself, guarantees via its own securities account with the actual “depositary” of the securities.

More information can be found on this Link (French).

Febelfin

04/02/2021

Agreement regarding the moratorium on the suspension of payment

Banks and the sector organization under the supervision of the Minister of Finance have agreed on an extension of the existing temporary support package system in place since March 2020.

For further information in Dutch, click here.

For further information in French, click here.