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Establish a Subsidiary in Belgium

Updated on Monday 26th June 2017

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Characteristics of a Belgian subsidiary

A subsidiary established in Belgium is considered a legal entity separated from its parent company, because of the fact that it has its own capital and separated administration. Even if you have a firm in Italy, France or ther European country, you can set up a company in Belgium

Below are presented the main particularities of a subsidiary in Belgium. Take  a look!

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Advantages of owning a subsidiary in Belgium

An advantage of keeping a subsidiary in Belgium is that the annual reports are less strict than for a branch, for example it doesn’t have to present the financial statements of the foreign company. The liability of its actions is not taken by the foreign company. A subsidiary opened in Belgium is regarded as an European company, not as a foreign company and beneficiate from the specific conditions.

The tax advantages that a company can receive from approaching this type of business are that

  • the subsidiary may not pay any withholding tax on the profits paid to the foreign company;
  • the subsidiary may beneficiate from the double tax avoidance regulations;
  • due to the EU Parent Subsidiary directive the dividends are not taxed in certain conditions.

Types of subsidiaries in Belgium

There are two forms of establishing a subsidiary in Belgium: as a company limited by shares or as a company with limited liability.

The company limited by shares must be formed by at least two founders with a minimum share capital of 61,500 Euros. The management is assured by a board of managers consisting in at least three members.

The limited liability company is the best form of organization of the small and medium businesses. There is a requirement of a minimum share capital of at least 6,200 Euros if there are more than two shareholders and at least 12,400 Euros in case there is just one shareholder. The limited liability company must guarantee that in the future the capital will be of at least 18,500 Euros.

This type of company is managed by one or more administrators appointed by the incorporators.

Procedure of opening a subsidiary in Belgium

Just like in other European countries like Estonia for exemple, the process of incorporation includes the notarization of certain documents, such as the deed of incorporation (containing the name of the shareholders, their address and their amount of capital brought to the company’s capital).

A business plan for the Belgium subsidiary must also be prepared and must contain the predictions for the future two years of activity, the reasons why the company is incorporated, a marketing research for the approached market segment, a list with the company’s services and products that will be presented to the future clients and a description of the company’s resources (human and financial). The business plan must be signed in front of a notary.

A bank account where the minimum share capital is deposited must be opened.

The next step is registering the subsidiary at the centralized docket for the Register of Legal Entities, VAT and social security.

As a result , the new formed subsidiary company will receive a unique company number and may begin the commercial activities just like in any other country. Please feel free to contact our company formation specialists for more details in regards to Belgian subsdiaries or other company formation issues in other countries, such as Serbia.

 

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