Belgian Commercial Court Establishes Incompatibility Between Task Of External Accountant And Liquidator
On 28 December 2010, the Leuven Commercial Court handed down a judgment in application of Article 184 of the Belgian Companies' Code governing the appointment of a liquidator in the event of the dissolution of a company
On 28 December 2010, the Leuven Commercial Court handed down a judgment in application of Article 184 of the Belgian Companies' Code governing the appointment of a liquidator in the event of the dissolution of a company.
In 2006, the Belgian legislator revised Article 184 of the Companies' Code which required the appointment of a liquidator by the general meeting of a company to be confirmed by the Commercial Court. Article 184, §1, section 2 of the Companies' Code provides that the Commercial Court can only confirm the appointment if the liquidator meets "all requirements of righteousness". The open-endedness of this criterion is often criticised by legal scholars (as well as the procedure as a whole, which causes significant and unnecessary delays in liquidation procedures).
In the case at hand, the Leuven Commercial Court refused to confirm the appointment of a liquidator because he had also acted as the external accountant of the company for the drafting of the statement of assets and liabilities required for the dissolution of the company in accordance with Article 181 of the Companies' Code. The Leuven Commercial Court was of the opinion that the function of external accountant was incompatible with that of liquidator. According to the Court, the external accountant's report is an important source of information for the liquidator in order to decide whether to (i) finalise the liquidation; (ii) try to conclude an agreement with the creditors; or (iii) file a petition in bankruptcy. Given that the company had made important losses and had many...
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