Economy Profile Belgium

Ease of Doing Business in Belgium

Ease of Doing Business in Belgium

Rankings on Doing Business topics – Belgium

Rankings on Doing Business topics - Belgium

Topic Scores

Topic Scores Belgium

Starting a Business

This topic measures the number of procedures, time, cost and paid-in minimum capital requirement for a small- to medium-sized limited liability company to start up and formally operate in each economy’s largest business city.

To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times the income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators.

The most recent round of data collection for the project was completed in May 2019. See the methodology for more information.

What the indicators measure

Procedures to legally start and formally operate a company (number)

  • Preregistration (for example, name verification or reservation, notarization)

  • Registration in the economy’s largest business city

  • Postregistration (for example, social security registration, company seal)

  • Obtaining approval from spouse to start a business or to leave the home to register the company

  • Obtaining any gender specific document for company registration and operation or national identification card

Time required to complete each procedure (calendar days)

  • Does not include time spent gathering information

  • Each procedure starts on a separate day (2 procedures cannot start on the same day)

  • Procedures fully completed online are recorded as ½ day

  • Procedure is considered completed once final document is received

  • No prior contact with officials

Cost required to complete each procedure (% of income per capita)

  • Official costs only, no bribes

  • No professional fees unless services required by law or commonly used in practice

Paid-in minimum capital (% of income per capita)

  • Funds deposited in a bank or with third party before registration or up to 3 months after incorporation

To make the data comparable across economies, several assumptions about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay no bribes.

The business:

-Is a limited liability company (or its legal equivalent). If there is more than one type of limited liability company in the economy, the limited liability form most common among domestic firms is chosen. Information on the most common form is obtained from incorporation lawyers or the statistical office.

-Operates in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

-Performs general industrial or commercial activities such as the production or sale to the public of goods or services. The business does not perform foreign trade activities and does not handle products subject to a special tax regime, for example, liquor or tobacco. It is not using heavily polluting production processes.

-Does not qualify for investment incentives or any special benefits.

-Is 100% domestically owned.

-Has five business owners, none of whom is a legal entity. One business owner holds 30% of the company shares, two owners have 20% of shares each, and two owners have 15% of shares each.

-Is managed by one local director.

-Has between 10 and 50 employees one month after the commencement of operations, all of them domestic nationals.

-Has start-up capital of 10 times income per capita.

-Has an estimated turnover of at least 100 times income per capita.

-Leases the commercial plant or offices and is not a proprietor of real estate.

-Has an annual lease for the office space equivalent to one income per capita.

-Is in an office space of approximately 929 square meters (10,000 square feet).

-Has a company deed that is 10 pages long.

The owners:

-Have reached the legal age of majority and are capable of making decisions as an adult. If there is no legal age of majority, they are assumed to be 30 years old.

-Are in good health and have no criminal record.

-Are married, the marriage is monogamous and registered with the authorities.

-Where the answer differs according to the legal system applicable to the woman or man in question (as may be the case in economies where there is legal plurality), the answer used will be the one that applies to the majority of the population.

Starting a Business – Belgium

Starting a Business - Belgium Starting a Business - Belgium

Figure – Starting a Business in Belgium – Score

Starting a Business - Belgium Score

Figure – Starting a Business in Belgium and comparator economies – Ranking and Score

DB 2020 Starting a Business Score

Starting a Business in Belgium and comparator economies – Ranking and Score

Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators.

Figure – Starting a Business in Belgium – Procedure, Time and Cost

Starting a Business in Belgium – Procedure, Time and Cost

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below.

Details – Starting a Business in Belgium – Procedure, Time and Cost

1 Deposit a financial plan with the notary, sign the deed of incorporation and the by-laws in the presence of a notary, who authenticates the documents and registers the deed of incorporation

Agency : Notary Office

The incorporation deed (which includes the initial version of the bylaws) must be drawn up in French or Dutch if done within Brussels. The required content is outlined in Articles 2:8 and 5:12 of the Company Code. The incorporation deed will then be signed by the founders and the notary.

When the deed is signed it can only be done in person.

The requirements are:

  1. Personal information from founders

  2. Financial plan. The financial plan describes and justifies the amount of initial capital. The plan must show that the initial capital will cover company operations for at least the first 2 years. The founders sign the plan and deposit it in the notary public’s custody before incorporation.

Companies later have the option of filing and completing registration online with the notary or in person at the One Stop Shop.

If the company has opted for the "online” procedure, then notary will proceed to electronically file the documents through the online site (www.e-notariat.be), which is only accessible to notaries. The e-notariat system (e-depot project) allows notaries to electronically file the deed of incorporation with the various data banks and to obtain the enterprise number of the company. Even though the company is able to obtain the enterprise company number this way it must still visit the OSS in order to activate the number.

For the notary fees, the following formula shall apply:

  • For the range of capital EUR 0 – 37,000 [= max EUR 37,000], the rate is 0.570%

  • For the range of capital EUR 37,001 – 99,000 [= max EUR 62,000], the rate is 0.399%

  • For the range of capital EUR 99,001 – 224,000 [= max EUR 125,000], the rate is 0.285%

  • For the range of capital EUR 224,001 – 534,000 [= max EUR 310,000], the rate is 0.171%

  • For the range of capital EUR 534,001 – 1,784,000 [= max EUR 1,250,000], the rate is 0.057%

– For the range of capital EUR 1,784,001 – 3,333,500 [= max EUR 1,549,500], the rate is 0.0228% For the surplus, the rate is 0.0114%.

  1. day Fixed registration duty of EUR 50 + Registration duty on written documents of EUR 95 + publication cost of EUR 228,93 (electronic filing) or EUR 283,38 (paper filing) + Notary fees around EUR 1,100 + notary's various costs (including file and administrative costs) of about EUR 500 + VAT

2 Register with the Register of Legal Entities and VAT at a centralized company docket (guichet-entreprises / ondernemingsloket) and obtain a company number

Agency : One-Stop Shop Register

After the filing of the deed of incorporation, the clerk's office will automatically register the company with the Register of Legal Entities, which is part of the Crossroads Bank for Enterprises. The company will be given a single identification number, the enterprise number (numéro d'entreprise, or ondernemingsnummer), which can be activated only by using a recognized one- stop shop (guichets d'entreprises or ondernemingsloketten).

Based on the number of employees, the projected annual turnover, and the shareholder class (private individuals), the company will qualify as a small- or medium-size enterprise (SME) according to the meaning of the Promotion of Independent Enterprise (General Provisions) Act of February 10, 1998. For a small or medium-size enterprise, activation of the company's registration with the Crossroads Bank for Enterprises (as referred to above) will be possible only once a certificate of competence has been obtained. The person in charge of daily company management must evidence his knowledge of business management with documentary proof of education (diplomas, etc.) or practical experience.

The company may request the VAT registration number either directly from the local VAT administration or through the centralized company docket, which can apply for the VAT registration number electronically (but in both cases, the VAT registration number will be granted by the VAT administration). The VAT registration and social security registration are done through a single enterprise number. The company therefore only needs to request the activation of the enterprise number as VAT registration number, if necessary for its activities. This activation can be done by the one-stop shop or directly by the VAT administration.

The fee for registering a company is EUR 88.5 for the main business entity and EUR 88.5 for every additional business unit to be registered with the Crossroads Bank for Enterprises.

VAT registration is (a) free of charge if done directly through the local VAT office and (b) EUR 55 (VAT excluded) if done through a one-stop shop (company docket).

3 Register ultimate beneficial owners in the UBO register

Agency : UBO register

The law of 18 September 2017 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and limitations to the use of cash provided for the creation in Belgium of a centralized register of beneficial owners ( “UBO” stands for “Ultimate Beneficial Owner”). The Law provides for the obligation for the companies, a(i) SBL and foundations to collect and hold adequate, accurate and current information on their beneficial owners and (2) for the administrators to transmit this information within the month and by electronic means to the UBO register.

Less than a day (online

procedure)

Free of charge

The UBO Register has been launched on 2 October 2018 for new companies. Existing companies

have a delay until 30 September 2019 to register their UBOs.

4 File the “Dimona In” statements and register employees with Social Security

Agency : Social Security agency

Whenever a new employee is hired, employers have to file DIMONA IN declaration (Déclaration Immédiate/ Onmiddellijke Aangifte) before the emloyee starts working to notify this information the Social Security Agency. This information, together with declarations about employees leaving the company (DIMONA OUT) is used by different governmental agencies to attribute social benefits to employees.

It can be done online at no cost.

Less than a day (online procedure), simultaneous with previous procedure

Free of charge

5 Undersign an insurance for accidents at work

Agency : Insurance company

According to the Accidents at Work Act of 10 April 1971, it is legally required for new companies to undersign an insurance for accidents at work and on the way to and from work prior to occupying their first employee.

The company needs to enter into an insurance contract with an insurance company authorized to extend this type of insurance policy. This requires the conclusion of a contract on the basis of information to be given and has no particular time frame. If the founders of the company do so wish, they can already take all necessary steps and enter into the contract prior to the incorporation (acting on behalf of the company in the process of incorporation) and have the company assuming the obligations immediately upon/shortly after incorporation.The cost depends on the insurance company with which the policy is entered into, the type of activity of the company and of the employees to be insured, the number of employees to be insured, their remuneration level, and the guarantees and services a company wants to conclude in addition to the minimum statutory requirements.

Takes place simultaneously with previous procedure.

1 day, simultaneous with previous procedure

Cf. details of the procedure

Dealing with Construction Permits

This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required notifications, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certification requirements. The most recent round of data collection was completed in May 2019. See the methodology for more

What the indicators measure

Procedures to legally build a warehouse (number)

  • Submitting all relevant documents and obtaining all necessary clearances, licenses, permits and certificates

  • Submitting all required notifications and receiving all necessary inspections

  • Obtaining utility connections for water and sewerage

  • Registering and selling the warehouse after its completion

Time required to complete each procedure (calendar days)

  • Does not include time spent gathering information

  • Each procedure starts on a separate day—though procedures that can be fully completed online are an exception to this rule

  • Procedure is considered completed once final document is received

  • No prior contact with officials

Cost required to complete each procedure (% of income per capita)

  • Official costs only, no bribes

    Building quality control index (0-15)

  • Quality of building regulations (0-2)

  • Quality control before construction (0-1)

  • Quality control during construction (0-3)

  • Quality control after construction (0-3)

  • Liability and insurance regimes (0-2)

  • Professional certifications (0-4)

To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility connections are used.

The construction company (BuildCo):

  • Is a limited liability company (or its legal equivalent) and operates in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Is 100% domestically and privately owned; has five owners, none of whom is a legal entity. Has a licensed architect and a licensed engineer, both registered with the local association of architects or engineers. BuildCo is not assumed to have any other employees who are technical or licensed experts, such as geological or topographical experts.

  • Owns the land on which the warehouse will be built and will sell the warehouse upon its completion.

The warehouse:

  • Will be used for general storage activities, such as storage of books or stationery.

  • Will have two stories, both above ground, with a total constructed area of approximately 1,300.6 square meters (14,000 square feet). Each floor will be 3 meters (9 feet, 10 inches) high and will be located on a land plot of approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita.

  • Will have complete architectural and technical plans prepared by a licensed architect. If preparation of the plans requires such steps as obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures.

  • Will take 30 weeks to construct (excluding all delays due to administrative and regulatory requirements).

The water and sewerage connections:

  • Will be 150 meters (492 feet) from the existing water source and sewer tap. If there is no water delivery infrastructure in the economy, a borehole will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built.

  • Will have an average water use of 662 liters (175 gallons) a day and an average wastewater flow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater flow of 1,136 liters (300 gallons) a day.

  • Will have a constant level of water demand and wastewater flow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection.

Dealing with Construction Permits – Belgium

Dealing with Construction Permits - Belgium

Figure – Dealing with Construction Permits in Belgium – Score

Dealing with Construction Permits in Belgium – Score

Figure – Dealing with Construction Permits in Belgium and comparator economies – Ranking and Score

DB 2020 Dealing with Construction Permits Score

Dealing with Construction Permits in Belgium and comparator economies – Ranking and Score

Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores are the simple average of the scores for each of the component indicators.

Figure – Dealing with Construction Permits in Belgium – Procedure, Time and Cost

Dealing with Construction Permits in Belgium – Procedure, Time and Cost

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below.

Figure – Dealing with Construction Permits in Belgium and comparator economies – Measure of Quality

Dealing with Construction Permits in Belgium and comparator economies – Measure of Quality

Details – Dealing with Construction Permits in Belgium – Procedure, Time and Cost

1 Obtain a recent proof of land ownership

Agency : Bureau de l’Enregistrement

The administration must check two items:

  1. That the person requesting the building permit has the right to do so. He might not necessarily be the owner of the land, but acting on behalf of the owner.

  2. The applicant must submit a recent list of neighboring plots. In case of inquiry they should be able to consult the neighbors.

Therefore, the cadastral extract must be recent. Although the town has access to cadastral plans, the applicant must still obtain a recent cadastral extract. It costs around 50-100 Euros and it takes a maximum of 15 days to obtain it.

7 days EUR 75

2 Obtain clearance from the Fire Department

Agency : Fire Department

Some municipalities request a fire department report on the owner’s behalf. The cost to obtain this report is set in the official fee schedule published in the law: December 18, 2003 Arrêté du Gouvernement de la Région de Bruxelles-Capitale fixant les redevances à percevoir en contrepartie des prestations effectuées pour des missions de prévention par le Service d’Incendie et d’Aide médicale urgente de la Région de Bruxelles-Capitale.

14 days EUR 880

3 Request building permit from the Municipality

Agency : Municipality

The building permit request must be filed with the Municipality along with drawings. In Brussels, an environmental impact report is not required for a warehouse construction similar to that in the Doing Business case study. Moreover, the building permit expires after 2 years from the date of issuance, if construction has not started within that period.

The Urbanism Department has 30 days to inform the applicant that the application is not complete. After that period, the administration has another 3 months, depending on the type of construction to deliver the "permis d'urbanism." Other clearances are required such as obtaining clearance from VIVAQUA for sewage, obtaining information regarding the sewage and the depth at which the sewage pipes are located. This can take another 30 days. Contacting VIVAQUA is done by the Urbanism Department and is part of the permit request process.

110 days EUR 780

4 Inform Municipality of commencement of work

Agency : Municipality

5 Receive on-site inspection from Fire Department after construction

Agency : Fire Department

1 day

no charge

The builder must inform the Municipality of the commencement of work by writing a certified letter 8 days prior to the start of construction. According to Art. 194/2 of the CoBAT, it is mandatory that the permit be posted on the construction site before the start of construction and throughout its entire duration.

1 day no charge

6 Inform Municipality of the completion of construction

Agency : Municipality

1 day no charge

7 File application and receive an inspection by the Cadastre upon completion of construction

Agency : Administration du Cadastre

Within 30 days after the warehouse is in use, BuildCo must file an application at the Cadastre for "Le Revenu Cadastral." The request is made by completing and submitting the form. An agent will visit the building and determine its value. BuildCo does not need to be present at the inspection. They inform BuildCo of the new property tax by certified mail. The value of the property is revised on an annual basis.

8 Apply for water and sewage connection

Agency : Hydrobru

1 day no charge

1 day no charge

9 Receive inspection for water and sewage on construction site

Agency : Hydrobru

The site inspection occurs in about a week from the request (EUR 50.00 per site visit, which is paid when the connection is established, procedure 10).

1 day no charge

10 Obtain water and sewage connection

Agency : Hydrobru

The sewage connection is assumed to be a standard connection of high-density polyethylene, 200 millimeters (7.8 inch) by 3 meters deep.

75 days EUR 16,602

Details – Dealing with Construction Permits in Belgium – Measure of Quality

Dealing with Construction Permits in Belgium – Measure of Quality

Getting Electricity

This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tariffs index measures reliability of supply, transparency of tariffs and the price of electricity. The most recent round of data collection for the project was completed in May 2019. See the methodology for more nformation.

What the indicators measure

Procedures to obtain an electricity connection (number)

  • Submitting all relevant documents and obtaining all necessary clearances and permits

  • Completing all required notifications and receiving all necessary inspections

  • Obtaining external installation works and possibly purchasing material for these works

  • Concluding any necessary supply contract and obtaining final supply

Time required to complete each procedure (calendar days)

  • Is at least 1 calendar day

  • Each procedure starts on a separate day

  • Does not include time spent gathering information

  • Reflects the time spent in practice, with little follow-up and no prior contact with officials

Cost required to complete each procedure (% of income per capita)

  • Official costs only, no bribes

  • Value added tax excluded

The reliability of supply and transparency of tariffs index (0-8)

  • Duration and frequency of power outages (0–3)

  • Tools to monitor power outages (0–1)

  • Tools to restore power supply (0–1)

  • Regulatory monitoring of utilities’ performance (0–1)

  • Financial deterrents limiting outages (0–1)

  • Transparency and accessibility of tariffs (0–1)

To make the data comparable across economies, several assumptions about the warehouse, the electricity connection and the monthly consumption are used.

The warehouse:

  • Is owned by a local entrepreneur and is used for storage of goods.

  • Is located in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Is located in an area where similar warehouses are typically located and is in an area with no physical constraints. For example, the property is not near a railway.

  • Is a new construction and is being connected to electricity for the first time.

  • Has two stories with a total surface area of approximately 1,300.6 square meters (14,000 square feet). The plot of land on which it is built is 929 square meters (10,000 square feet).

The electricity connection:

  • Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140- kilo-volt-ampere (kVA) with a power factor of 1, when 1 kVA = 1 kilowatt (kW).

  • Has a length of 150 meters. The connection is to either the low- or medium-voltage distribution network and is either overhead or underground, whichever is more common in the area where the warehouse is located and requires works that involve the crossing of a 10-meter road (such as by excavation or overhead lines) but are all carried out on public land. There is no crossing of other owners’ private property because the warehouse has access to a road.

  • Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service panel or switchboard and the meter base.

The monthly consumption:

  • It is assumed that the warehouse operates 30 days a month from 9:00 a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours (kWh); hourly consumption is 112 kWh.

  • If multiple electricity suppliers exist, the warehouse is served by the cheapest supplier.

  • Tariffs effective in January of the current year are used for calculation of the price of electricity for the warehouse. Although January has 31 days, for calculation purposes only 30 days are used.

Price of electricity (cents per kilowatt-hour)*

Price based on monthly bill for commercial warehouse in case study

*Note: Doing Business measures the price of electricity, but it is not included in the ease of doing business score nor in the ranking on the ease of getting electricity.

Getting Electricity – Belgium

getting electricity belgium

Figure – Getting Electricity in Belgium – Score

getting electricity belgium score

Figure – Getting Electricity in Belgium and comparator economies – Ranking and Score

DB 2020 Getting Electricity Score

getting electricity in belgium and comparator economies ranking and score

Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the scores for all the component indicators except the price of electricity.

Figure – Getting Electricity in Belgium – Procedure, Time and Cost

getting electricity in belgium procedure time and cost

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures

reflected here, see the summary below.

Figure – Getting Electricity in Belgium and comparator economies – Measure of Quality

getting electricity in belgium and comparator economies measure of quality

Details – Getting Electricity in Belgium – Procedure, Time and Cost

1 Submit application to Sibelga and await estimate

Agency : Sibelga

An application for a new electricity connection can be submitted online, by courier or by written request through postal service. An unofficial map/sketch indicating the building and public streets needs to be provided with the application. The document does not need notarization. An estimate is sent to the customer after submission of the application.

2 Conclude contract with electricity supplier

Agency : Electricity supplier

The customer has to conclude a contract with a supplier. Most of the suppliers offer contracting by website (online) or by phone, and the electricity supply contract is usually concluded directly. The supplier has to register the contract in the national register for access to the network, which is done within 24 hours.

21 calendar days EUR 679

3 Receive internal wiring inspection by approved agency

Agency : Approved agency

There is no external inspection. However, before the external connection works and the turn-on of the meter, the internal wiring of the warehouse must be inspected by an approved agency such as Vincotte or BTV. The customer has to make that request. The customer or a representative has to be present for the inspection. The certificate of compliance is obtained immediately after the inspection.

1 calendar day EUR 217.39

4 Accept estimate and await completion of external works by Sibelga

Agency : Sibelga

The payment of the estimate can be done by wire transfer to a bank. The planning and execution of the external connection works can only begin after the estimate has been paid as this serves as approval of the offer. The installation of the meter is done by Sibelga and the final connections works is done by a different team within the same department. The electricity starts flowing immediately after the connection has been done if the contract between the supplier and the customer has been registered and the report of the internal inspection has been provided.

150 calendar days EUR 16,389

5 Purchase and install transformer

Agency : Electrical Contractor

The electrician of the client purchases a transformer and installs it on the ground of the warehouse to be connected with the network of the utility.

6 Obtain certification of works by specialized agency

Agency : Authorized agency

A representative of a specialized agency comes to the warehouse to approve the installation works of the transformer. The price of the certification is included in the price of installation of the transformer.

14 calendar days EUR 20,000

1 calendar day EUR 0

Details – Getting Electricity in Belgium – Measure of Quality

image

Answer

Reliability of supply and transparency of tariff index (0-8) 8

System average interruption duration index (SAIDI) 0.4

Total duration and frequency of outages per customer a year (0-3) 3

What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 3.0

System average interruption frequency index (SAIFI) 0.4

Does the distribution utility use automated tools to monitor outages? Yes

Mechanisms for monitoring outages (0-1) 1

Does the distribution utility use automated tools to restore service? Yes

Mechanisms for restoring service (0-1) 1

Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply? Yes

Regulatory monitoring (0-1) 1

Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap? Yes

Financial deterrents aimed at limiting outages (0-1) 1

Are effective tariffs available online? Yes

Communication of tariffs and tariff changes (0-1) 1

Link to the website, if available online https://entreprises.mesfou

image

Are customers notified of a change in tariff ahead of the billing cycle? Yes

rnisseurs.be/energie/gaz- electricite

Note:

If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index.

If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index.

image

Registering Property

This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has five dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information.

image

What the indicators measure

Case study assumptions

Procedures to legally transfer title on immovable property (number)

  • Preregistration procedures (for example, checking for liens, notarizing sales agreement, paying property transfer taxes)

  • Registration procedures in the economy's largest business city.

  • Postregistration procedures (for example, filling title with municipality)

Time required to complete each procedure (calendar days)

  • Does not include time spent gathering information

  • Each procedure starts on a separate day – though procedures that can be fully completed online are an exception to this rule

  • Procedure is considered completed once final document is received

  • No prior contact with officials

    Cost required to complete each procedure (% of property value)

  • Official costs only (such as administrative fees, duties and taxes).

  • Value Added Tax, Capital Gains Tax and illicit payments are excluded

    Quality of land administration index (0-30)

  • Reliability of infrastructure index (0-8)

  • Transparency of information index (0–6)

  • Geographic coverage index (0–8)

  • Land dispute resolution index (0–8)

  • Equal access to property rights index (-2–0)

To make the data comparable across economies, several assumptions about the parties to the transaction, the property and the procedures are used.

The parties (buyer and seller):

  • Are limited liability companies (or the legal equivalent).

  • Are located in the periurban (that is, on the outskirts of the city but still within its official limits) area of the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Are 100% domestically and privately owned.

  • Perform general commercial activities.

    The property (fully owned by the seller):

  • Has a value of 50 times income per capita, which equals the sale price.

  • Is fully owned by the seller.

  • Has no mortgages attached and has been under the same ownership for the past 10 years.

  • Is registered in the land registry or cadastre, or both, and is free of title disputes.

  • Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its official limits), and no rezoning is required.

  • Consists of land and a building. The land area is 557.4 square meters (6,000 square feet). A two- story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in good condition, has no heating system and complies with all safety standards, building codes and legal requirements. The property, consisting of land and building, will be transferred in its entirety.

  • Will not be subject to renovations or additional construction following the purchase.

  • Has no trees, natural water sources, natural reserves or historical monuments of any kind.

  • Will not be used for special purposes, and no special permits, such as for residential use, industrial plants, waste storage or certain types of agricultural activities, are required.

  • Has no occupants, and no other party holds a legal interest in it.

image

Registering Property – Belgium

Indicator

Belgium

OECD high income

Best Regulatory Performance

Procedures (number)

8

4.7

1 (5 Economies)

Time (days)

49

23.6

1 (2 Economies)

Cost (% of property value)

12.7

4.2

0.0 (Saudi Arabia)

Quality of the land administration index (0-30)

22.0

23.2

None in 2018/19

Figure – Registering Property in Belgium – Score

image

41.7

image

77.0

image

15.3

image

73.3

Procedures

Time

Cost

Quality of the land administration index

Figure – Registering Property in Belgium and comparator economies – Ranking and Score

DB 2020 Registering Property Score

image

0 100

80.1: Netherlands (Rank: 30)

77.0: Regional Average (OECD high income)

75.7: United Kingdom (Rank: 41)

66.6: Germany (Rank: 76)

63.3: France (Rank: 99)

51.8: Belgium (Rank: 139)

Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of the scores for each of the component indicators.

Figure – Registering Property in Belgium – Procedure, Time and Cost

image

image

Time (days) Cost (% of property value)

image

14

12

Cost (% of property value)

40

10

Time (days)

30

8

20 6

4

10

2

0 0

1 2 * 3 * 4 * 5 * 6 7 8

Procedures (number)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below.

Figure – Registering Property in Belgium and comparator economies – Measure of Quality

image

28.5

22.0

24.0

26.0

23.0

23.2

35

30

Index score

25

20

15

10

5

0

Belgium France Germany Netherlands United

Kingdom

OECD

high income

Details – Registering Property in Belgium – Procedure, Time and Cost

image

No. Procedures Time to Complete Associated Costs

1 Parties give initial sale agreement to notary

Agency : Notary

The transfer of ownership can be done by an agreement between seller and buyer. However, to validate the transfer of ownership vis-à-vis third parties, the initial agreement ("compromis de vente" or "verkoopsovereenkomst") needs to be notarized and registered with the mortgage register by a notary. The notary will draw up a deed and obtain all necessary documentation (see following Procedures). The notary also checks, for companies, the copy of the publication of the names of the directors in the Belgian Official Gazette. The documentation shall include:

  • Initial sale agreement

  • Proper proof of identification, or, in the case of a company, the memorandum of association/articles of incorporation/by-laws

  1. day Included in Procedure 8

  2. Notary obtains excerpt from the mortgage register to verify whether certain third party rights were granted over the property and copies of the transfer deeds over a 30-year period

    Agency : Administration of legal security (Patrimonial Documentation)

    The notary obtains an excerpt from the Administration of Legal Security to verify whether certain third party rights were granted over the property, e.g. through mortgages, rights to construct ("opstalrecht / droit de superficie"). A 30-year title search will be included in the documents. The notary might request a full transcription, an inscription extract or a notification extract ("kantmelding / mention marginale") of transfer deeds over 30 years affecting the property object to the transaction. The Administratopm of Legal Security provides (i) "full transcription" of the title or of the judgment attributing the title: the date of acquisition of the full ownership or other right over the property (such as usufruct -right to use the property-, superficies-right to construct), the terms and conditions of the acquisition including the purchase price, the existence of lease contracts exceeding 9 years and information on the rights of third parties such as judgments, servitudes/easements and seizures affecting the property in question for the past 30 years and (ii) by "inscription" whether the right over the property is encumbered by a mortgage or a legal lien (beneficiary, amount, costs, term).

    23 days EUR 85 (excerpt, included

    in Procedure 8) + EUR 50 (copies of deeds, included in Procedure 8)

    image

  3. Obtain a clean-soil certificate from Brussels Environment

Agency : Brussels Environment (Bruxelles-Envrionnement/Leefmilieu)

Brussels legislation on soil clean-up (ordonnance du 5 mars 2009 relative à la gestion et à l'assainissement des sols pollués et l'arrêté du 16 fevrier 2017 du gouvernement de la région de Bruxelles-Capitale relatif à l'attestation du sol) state that a soil certificate is now required for every transfer of land. The time limit is 20 days from receipt of the (valid) request to obtain a soil certificate. The seller of an immovable good has to ask the Brussels Environment for a soil certificate (attestation du sol/bodemattest) which he has to transmit to the buyer before the conclusion of the private sale agreement (compromis de vente). For some lands, an expert must examine the land to check whether the soil is polluted ("reconnaissance du sol /verkennend bodemonderzoek"). Based on the results of this survey, Brussels Environment decides whether the transfer can take place without any further measurements or whether the condition of the soil requires additional measures to be taken (e.g. clean-up). If other measures have to be taken, the transfer can nevertheless take place before the clean-up if some conditions are fulfilled. This new Act is a transposition of European legislation (Article 17§2 of the Ordinance of 5 March 2009).

image 4 Notary obtains tax certificates relating to the seller's tax position from tax administration (Inland Revenue)

Agency : Inland Revenue

The notary obtains tax certificates relating to the seller's tax position from the Inland Revenue, the VAT authorities and the municipal tax collector pertaining to the seller's tax position. A request for this information can be submitted online, but the response will arrive 15 days later. If there is no answer within 12 working days, the notary can process the deed anyway, therefore assuming there are no tax issues. The only tax information which still needs to be asked by registered letter is the municipal or provincial tax information. Since April 2007, notaries have to verify at the same time the seller's social security position. The notary has to check with every social security fund (there are +/- 15 of them). However, this process is done electronically, simultaneously with the verification of the tax position. The Procedure is integrated into the existing Procedure related to the tax position of the seller. The time needed for this verification is 15 days as well. It takes place fully electronically, just as getting the tax certificates.

20 days EUR 36; (EUR 36)

15 days EUR 24.8 (included in

Procedure 8)

image

image

5 Notary obtains zoning certificates from the municipality

Agency : Municipality

The notary obtains zoning certificate. In the Brussels-Capital Region, every request needs to be sent by registered letter to the municipality in question. The request is done by using a specific document as determined in the Decision of the Brussels-Capital Region of 29 March 2018 concerning the town planning information (Annex I). The municipality is required to answer within 30 days if its standard request (EUR80) and 5 days if it's an expedited process (EUR160).

5 days EUR 160 for an expedited certificate (included in Procedure 8)

image 6 Notary obtains excerpt and plan from land register ("kadaster / cadastre") indicating the exact land register references

Agency : Land register ("kadaster / cadastre")

image

7

The notary draws up the deed based on the agreement between the parties

Agency : Notary

Based on the agreement between the parties, the notary will draw up a deed after obtaining the required documents.

2 days

Included in Procedure 8

Usually, the seller and buying company enter into a private agreement (“onderhandse overeenkomst / le compromis”) in which the main contractual provisions (price, subject matter, obligations of both parties, etc) are listed. Subject to fulfillment of certain conditions precedent, if any, such agreement will transfer title to the buyer. Vis-à-vis third parties, the title will pass upon registration of the deed with the Administration of legal security (“hypotheekkantoor / registre des hypothèques” ) referred to in the following procedure. Common conditions precedent are: waiver of pre-emption rights over the property and obtaining of consents from local authorities. Transfer of title between parties can be made subject to the registration of the deed with the mortgage registry.

Before execution of the deed, the notary will generally have obtained the following documents:

-Excerpt from the mortgage register to verify whether certain third party rights were granted over the property and copies of the transfer deeds over a 30-year period (Procedure 2)

-Tax certificates from the Inland Revenue, the VAT authorities and the municipal tax collector relating to the seller’s tax position (the same certificates will be requested about the buyer company if it finances the acquisition through a mortgage-backed facility agreement) (obtained in Procedure 4)

-Zoning certificates (obtained in Procedure 5)

-Excerpt and plan from the land register (“kadaster / cadastre”) indicating the exact land register references (obtained in Procedure 6)

-Obtaining waivers of pre-emption rights and consents from local authorities, if any;

Additionally, a clean-soil certificate from Brussels Environment must be obtained by the parties before registration.

The notary’s fees are determined by law (Arrete Royal), and the payment of the registration duties and notary fees takes place after the signature of the deed.

The notary must register the deed at the latest four (4) months after the effective date of the initial (private) sale agreement. Since only notarial deeds can be registered, this results de facto in the obligation to draw up the deed within this period. In case of late registration, a fine can be imposed.

Notary obtains excerpt and plan from the land register ("kadaster / cadastre") indicating the specific land register references, and (i) the specified address/location of the property or, if the address/location is not available, (ii) the identity and address of the (assumed) owner. The transfer deed must contain the latest cadastral information about the property to be transferred. Notaries can now verify the most updated cadastral information on that property online and print the information to complete the transaction. Since November 2018, Notaries can request the official cadastral documents ("extrait cadastral") online.

Less than one day, online

EUR 20 (EUR 3.15 per

online request + EUR 5.5 excerpt of the cadastral matrix (212 AM) + EUR 11 excerpt of the cadastral plan) Included in Procedure 8

8 The notary applies for registration with the local Registration Office (Tax Office) and also with the Administration of legal security

Agency : Administration of legal security (Patrimonial Documentation)

The notary is required to present the original deed itself to his local Registration Office (Tax office) within 15 days after the date of execution for payment of the stamp duties. The notary is also required to present an authentic copy of the deed to the Administration of legal security for transcription within 15 days from the date of the deed (this guarantees publicity vis-à-vis third parties). The mortgage register will verify all documentation and complete the transfer in its records and send a certified copy of the deed.

23 days EUR 253,845.09; (12.5%

of transaction price (registration fee) + EUR 220 for the transcription of an extract of the deed at the Administration of legal security + notary fees + all due diligence

Notary fees are calculated according to the following declining and successive scale:

EUR 7,500 at 4,56%

EUR 10,000 at 2,85%

EUR 12,500 at 2,28%

EUR 15,495 at 1,71%

EUR 18,600 at 1,14%

EUR 186,000 at 0,57%

image

Excess of all amounts above charged at 0,057%)

imageTakes place simultaneously with previous procedure.

image

Details – Registering Property in Belgium – Measure of Quality

Answer

Score

Quality of the land administration index (0-30)

22.0

Reliability of infrastructure index (0-8)

5.0

Type of land registration system in the economy:

Deed Registration System

What is the institution in charge of immovable property registration?

Bureau Sécurité juridique (Administration of legal security)

In what format are past and newly issued land records kept at the immovable property registry of the largest business city of the economy —in a paper format or in a computerized format (scanned or fully digital)?

Computer/Scanned

1.0

Is there a comprehensive and functional electronic database for checking for encumbrances (liens, mortgages, restrictions and the like)?

No

0.0

Institution in charge of the plans showing legal boundaries in the largest business city:

The Cadastre at the general Administration of patrimonial Documentation (Administration générale de la Documentation patrimoniale)

In what format are past and newly issued cadastral plans kept at the mapping agency of the largest business city of the economy—in a paper format or in a computerized format (scanned or fully digital)?

Computer/Fully digital

2.0

Is there an electronic database for recording boundaries, checking plans and providing cadastral information (geographic information system)?

Yes

1.0

Is the information recorded by the immovable property registration agency and the cadastral or mapping agency kept in a single database, in different but linked databases or in separate databases?

Separate databases

0.0

Do the immovable property registration agency and cadastral or mapping agency use the same identification number for properties?

Yes

1.0

Transparency of information index (0–6)

3.0

Who is able to obtain information on land ownership at the agency in charge of immovable property registration in the largest business city?

Anyone who pays the official fee

1.0

Is the list of documents that are required to complete any type of property transaction made publicly available– and if so, how?

No

0.0

Link for online access:

Is the applicable fee schedule for any type of property transaction at the agency in charge of immovable property registration in the largest business city made publicly available–and if so, how?

Yes, online

0.5

Link for online access:

https://finances.belgiu m.be/fr/particuliers/ha bitation/acheter_vend re/acheter_et_vendre

_avec_droits_d_enre gistrement/r%C3%A9 gion-de https://www.notaire.b e/calcul-de-frais

Does the agency in charge of immovable property registration agency formally commit to deliver a legally binding document that proves property ownership within a specific timeframe –and if so, how does it communicate the service standard?

No

0.0

Link for online access:

Is there a specific and independent mechanism for filing complaints about a problem that occurred at the agency in charge of immovable property registration?

Yes

1.0

Contact information:

http://finances.belgiu

m.be/fr/Contact/servic

e_gestion_des_plaint

es/ Section

"Documentation

patrimoniale"

Are there publicly available official statistics tracking the number of transactions at the immovable property registration agency?

No

0.0

Number of property transfers in the largest business city in 2018:

Who is able to consult maps of land plots in the largest business city?

Only intermediaries and interested parties

0.0

Is the applicable fee schedule for accessing maps of land plots made publicly available—and if so, how?

Yes, online

0.5

Link for online access:

https://finances.belgiu m.be/fr/particuliers/ha bitation/cadastre/extr ait-cadastral

Does the cadastral/mapping agency formally specifies the timeframe to deliver an updated cadastral plan—and if so, how does it communicate the service standard?

No

0.0

Link for online access:

Is there a specific and independent mechanism for filing complaints about a problem that occurred at the cadastral or mapping agency?

No

0.0

Contact information:

Geographic coverage index (0–8)

8.0

Are all privately held land plots in the largest business city formally registered at the immovable property registry?

Yes

2.0

Are all privately held land plots in the economy formally registered at the immovable property registry?

Yes

2.0

Are all privately held land plots in the largest business city mapped?

Yes

2.0

Are all privately held land plots in the economy mapped?

Yes

2.0

Land dispute resolution index (0–8)

6.0

Does the law require that all property sale transactions be registered at the immovable property registry to make them opposable to third parties?

Yes

1.5

Legal basis:

Article 1 Mortgage Law (loi hypothecaire du 16 decembre

1851)

Is the system of immovable property registration subject to a state or private guarantee?

Yes

0.5

Type of guarantee:

State guarantee

Legal basis:

Article 1 Mortgage Law (loi hypothecaire du 16 decembre

1851)

Is there a is a specific, out-of-court compensation mechanism to cover for losses incurred by parties who engaged in good faith in a property transaction based on erroneous information certified by the immovable property registry?

No

0.0

Legal basis:

Does the legal system require a control of legality of the documents necessary for a property transaction (e.g., checking the compliance of contracts with requirements of the law)?

Yes

0.5

If yes, who is responsible for checking the legality of the documents?

Registrar; Notary;

Does the legal system require verification of the identity of the parties to a property transaction?

Yes

0.5

If yes, who is responsible for verifying the identity of the parties?

Registrar; Notary;

Is there a national database to verify the accuracy of government issued identity documents?

Yes

1.0

What is the Court of first instance in charge of a case involving a standard land dispute between two local businesses over tenure rights for a property worth 50 times gross national income (GNI) per capita and located in the largest business city?

Business Court (Tribunal de l'entreprise/Onderne mingsrechtbank)

How long does it take on average to obtain a decision from the first-instance court for such a case (without appeal)?

Between 1 and 2 years

2.0

Are there publicly available statistics on the number of land disputes at the economy level in the first instance court?

No

0.0

Number of land disputes in the economy in 2018:

Equal access to property rights index (-2–0)

0.0

Do unmarried men and unmarried women have equal ownership rights to property?

Yes

Do married men and married women have equal ownership rights to property?

Yes

0.0

image

Getting Credit

This topic explores two sets of issues—the strength of credit reporting systems and the effectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information.

image

What the indicators measure

Case study assumptions

Strength of legal rights index (0–12)

  • Rights of borrowers and lenders through collateral laws (0-10)

  • Protection of secured creditors’ rights through bankruptcy laws (0-2)

    Depth of credit information index (0–8)

  • Scope and accessibility of credit information distributed by credit bureaus and credit registries (0-8)

    Credit bureau coverage (% of adults)

  • Number of individuals and firms listed in largest credit bureau as a percentage of adult population

    Credit registry coverage (% of adults)

  • Number of individuals and firms listed in credit registry as a percentage of adult population

Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions through 2 sets of indicators. The depth of credit information index measures rules and practices affecting the coverage, scope and accessibility of credit information available through a credit registry or a credit bureau. The strength of legal rights index measures the degree to which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined whether a unitary secured transactions system exists. Then two case scenarios, case A and case B, are used to determine how a nonpossessory security interest is created, publicized and enforced according to the law. Special emphasis is given to how the collateral registry operates (if registration of security interests is possible). The case scenarios involve a secured borrower, company ABC, and a secured lender, BizBank.

In some economies the legal framework for secured transactions will allow only case A or case B (not both) to apply. Both cases examine the same set of legal provisions relating to the use of movable collateral.

Several assumptions about the secured borrower (ABC) and lender (BizBank) are used:

  • ABC is a domestic limited liability company (or its legal equivalent).

  • ABC has up to 50 employees.

  • ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Both ABC and BizBank are 100% domestically owned.

The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests).

In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets.

image

Getting Credit – Belgium

Indicator

Belgium

OECD high income

Best Regulatory Performance

Strength of legal rights index (0-12)

8

6.1

12 (5 Economies)

Depth of credit information index (0-8)

5

6.8

8 (53 Economies)

Credit registry coverage (% of adults)

95.6

24.4

100.0 (2 Economies)

Credit bureau coverage (% of adults)

0.0

66.7

100.0 (14 Economies)

Figure – Getting Credit in Belgium – Score

image

65.0

Score – Getting Credit

Figure – Getting Credit in Belgium and comparator economies – Ranking and Score

DB 2020 Getting Credit Score

image

0 100

75.0: United Kingdom (Rank: 37)

70.0: Germany (Rank: 48)

65.0: Belgium (Rank: 67)

64.3: Regional Average (OECD high income) 50.0: France (Rank: 104)

45.0: Netherlands (Rank: 119)

Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the sum of the scores for the strength of legal rights index and the depth of credit information index.

Figure – Legal Rights in Belgium and comparator economies

image

8

7

6

6.1

4

2

9

8

Index Score

7

6

5

4

3

2

1

0

Belgium France Germany Netherlands United

Kingdom

OECD

high income

Details – Legal Rights in Belgium

image

Strength of legal rights index (0-12) 8

image

Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without requiring a specific description

of collateral?

No

Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and enforcement of functional equivalents No to security interests in movable assets exist in the economy?

image

May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and replacements of the

original assets?

Yes

Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a specific description of collateral?

Yes

image

Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by asset type, with an

electronic database indexed by debtor's name?

Yes

Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered?

Yes

Does a notice-based collateral registry exist in which all functional equivalents can be registered? No

Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed online by any interested third Yes party?

Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency procedure? Yes

Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated? Yes

image

Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow the secured creditor to sell Yes the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt?

Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law No protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time limit for it?

Figure – Credit Information in Belgium and comparator economies

image

8

8

7

6.8

6

5

9

8

Index Score

7

6

5

4

3

2

1

0

Belgium France Germany Netherlands United

Kingdom

OECD

high income

image

Details – Credit Information in Belgium

image

Depth of credit information index (0-8)

Credit bureau

Credit registry

Score

Are data on both firms and individuals distributed?

No

Yes

1

image

Are data from retailers or utility companies – in addition to data from banks and

financial institutions – distributed?

No

Yes

1

Are both positive and negative credit data distributed? No No 0

image

Are data on loan amounts below 1% of income per capita distributed?

No

Yes

1

Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.)

No No 0

By law, do borrowers have the right to access their data in the credit bureau or credit registry?

No Yes 1

image

Can banks and financial institutions access borrowers’ credit information online (for example, through an online platform, a system-to-system connection or both)?

No Yes 1

image

Total Score ("yes" to either public bureau or private registry)

5

Are bureau or registry credit scores offered as a value-added service to help banks and financial institutions assess the creditworthiness of borrowers?

No No 0

image

Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0.

Coverage

Credit bureau

Credit registry

Number of individuals

0

6,612,634

Number of firms

0

382,322

Total

0

6,994,956

Percentage of adult population

0.0

95.6

image

Protecting Minority Investors

This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information.

image

What the indicators measure

Case study assumptions

  • Extent of disclosure index (0–10): Disclosure, review, and approval requirements for related-party transactions

  • Extent of director liability index (0–10): Ability of minority shareholders to sue and hold interested directors liable for prejudicial related-party transactions; Available legal

    remedies (damages, disgorgement of profits, disqualification from managerial position(s) for one year or more, rescission of the transaction)

  • Ease of shareholder suits index (0–10): Access to internal corporate documents; Evidence obtainable during trial and allocation of legal expenses

  • Extent of conflict of interest regulation index (0-30): Sum of the extent of disclosure, extent of director liability and ease of shareholder suits indices

  • Extent of shareholder rights index (0-6): Shareholders’ rights and role in major corporate decisions

  • Extent of ownership and control index (0-7): Governance safeguards protecting shareholders from undue board control and entrenchment

  • Extent of corporate transparency index (0-7): Corporate transparency on ownership stakes, compensation, audits and financial prospects

  • Extent of shareholder governance index (0–20): Sum of the extent of shareholders rights, extent of ownership and control and extent of corporate transparency indices

  • Strength of minority investor protection index (0–50): Sum of the extent of conflict of interest regulation and extent of shareholder governance indices

To make the data comparable across economies, a case study uses several assumptions about the business and the transaction.

The business (Buyer):

  • Is a publicly traded corporation listed on the economy’s most important stock exchange.

  • Has a board of directors and a chief executive officer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not specifically required by law.

  • Has a supervisory board in economies with a two-tier board system on which Mr. James appointed 60% of the shareholder-elected members.

  • Has not adopted bylaws or articles of association that go beyond the minimum requirements. Does not follow codes, principles, recommendations or guidelines that are not mandatory.

  • Is a manufacturing company with its own distribution network.

    The transaction involves the following details:

  • Mr. James owns 60% of Buyer, sits on Buyer’s board of directors and elected two directors to Buyer’s five-member board.

  • Mr. James also owns 90% of Seller, a company that operates a chain of retail hardware stores. Seller recently closed a large number of its stores.

  • Mr. James proposes that Buyer purchase Seller’s unused fleet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer agrees. The price is equal to 10% of Buyer’s assets and is higher than the market value.

  • The proposed transaction is part of the company’s principal activity and is not outside the authority of the company.

  • Buyer enters into the transaction. All required approvals are obtained, and all required disclosures made—that is, the transaction was not entered into fraudulently.

  • The transaction causes damages to Buyer. Shareholders sue Mr. James and the executives and directors that approved the transaction.

Protecting Minority Investors – Belgium

image

Stock exchange information

Stock exchange

Euronext Brussels

image

Listed firms with equity securities

139

Stock exchange URL http://www.euronext.com

image

Indicator

Belgium

OECD high income

Best Regulatory Performance

Extent of disclosure index (0-10)

8.0

6.5

10 (13 Economies)

City Covered Brussels

image

image

Ease of shareholder suits index (0-10)

7.0

7.3

10 (Djibouti)

Extent of director liability index (0-10) 6.0 5.3 10 (3 Economies)

image

Extent of ownership and control index (0-7)

3.0

4.5

7 (9 Economies)

Extent of shareholder rights index (0-6) 4.0 4.7 6 (19 Economies)

image

Figure – Protecting Minority in Belgium – Score

image

68.0

Extent of corporate transparency index (0-7) 6.0 5.7 7 (13 Economies)

image

Score – Protecting Minority Investors

Figure – Protecting Minority Investors in Belgium and comparator economies – Ranking and Score

DB 2020 Protecting Minority Investors Score

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0 100

84.0: United Kingdom (Rank: 7)

68.2: Regional Average (OECD high income)

68.0: Belgium (Rank: 45)

68.0: France (Rank: 45)

62.0: Germany (Rank: 61)

58.0: Netherlands (Rank: 79)

Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority investors. These scores are the simple average of the scores for the extent of conflict of interest regulation index and the extent of shareholder governance index.

Figure – Protecting Minority Investors in Belgium and comparator economies – Measure of Quality

Belgium

France

Germany

Netherlands

United Kingdom

OECD high income

image

image

6

6

8

3

4

7

7

3

8

6

4

6

6

5

5

5

5

5

5

4

4

5

5

6

6

7

10

5

6

8

5.6

5.6

6.6

4.3

4.5

7.4

0 5 10 15 20 25 30 35 40 45

Sub-Indicator Score

image

image

image

image

image

image

Extent of corporate transparency index (0-7) Extent of director liability index (0-10) Extent of disclosure index (0-10) Extent of ownership and control index (0-7) Extent of shareholder rights index (0-6) Ease of shareholder suits index (0-10)

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Details – Protecting Minority Investors in Belgium – Measure of Quality

Answer

Score

Extent of conflict of interest regulation index (0-30)

Extent of disclosure index (0-10)

8.0

Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3)

Board of directors excluding interested members

2.0

Must an external body review the terms of the transaction before it takes place? (0-1)

Yes

1.0

Must Mr. James disclose his conflict of interest to the board of directors? (0-2)

Full disclosure of all material facts

2.0

Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2)

Disclosure on the transaction and on the conflict of interest

2.0

Must Buyer immediately disclose the transaction to the public? (0-2)

Disclosure on the transaction only

1.0

Extent of director liability index (0-10)

6.0

Can shareholders representing 10% of Buyer's share capital sue for the damage the transaction caused to Buyer? (0-1)

Yes

1.0

Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0-2)

Liable if negligent

1.0

Can shareholders hold the other directors liable for the damage the transaction caused to Buyer? (0-2)

Liable if negligent

1.0

Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by shareholders? (0-1)

Yes

1.0

Must Mr. James repay profits made from the transaction upon a successful claim by shareholders? (0-1)

Yes

1.0

Is Mr. James disqualified upon a successful claim by shareholders? (0-1)

No

0.0

Can a court void the transaction upon a successful claim by shareholders? (0-2)

Voidable if negligently concluded

1.0

Ease of shareholder suits index (0-10)

7.0

Before suing, can shareholders representing 10% of Buyer's share capital inspect the transaction documents? (0-1)

Yes

1.0

Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3)

Any relevant document

3.0

Can the plaintiff request categories of documents from the defendant without identifying specific ones? (0-1)

Yes

1.0

Can the plaintiff directly question the defendant and witnesses at trial? (0-2)

No

0.0

Is the level of proof required for civil suits lower than that of criminal cases? (0-1)

Yes

1.0

Can shareholder plaintiffs recover their legal expenses from the company? (0-2)

Yes if successful

1.0

Extent of shareholder governance index (0-20)

Extent of shareholder rights index (0-6)

4.0

Does the sale of 51% of Buyer's assets require shareholder approval?

No

0.0

Can shareholders representing 10% of Buyer's share capital call for a meeting of shareholders?

No

0.0

Must Buyer obtain its shareholders’ approval every time it issues new shares?

Yes

1.0

Do shareholders automatically receive preemption rights every time Buyer issues new shares?

Yes

1.0

Do shareholders elect and dismiss the external auditor?

Yes

1.0

Are changes to the rights of a class of shares only possible if the holders of the affected shares approve?

Yes

1.0

Extent of ownership and control index (0-7)

3.0

Is it forbidden to appoint the same individual as CEO and chairperson of the board of directors?

No

0.0

Must the board of directors include independent and nonexecutive board members?

No

0.0

Can shareholders remove members of the board of directors without cause before the end of their term?

Yes

1.0

Must the board of directors include a separate audit committee exclusively comprising board members?

Yes

1.0

Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of Buyer?

Yes

1.0

Must Buyer pay declared dividends within a maximum period set by law?

No

0.0

Is a subsidiary prohibited from acquiring shares issued by its parent company?

No

0.0

Extent of corporate transparency index (0-7)

6.0

Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%?

Yes

1.0

Must Buyer disclose information about board members’ primary employment and directorships in other companies?

No

0.0

Must Buyer disclose the compensation of individual managers?

Yes

1.0

Must a detailed notice of general meeting be sent 21 days before the meeting?

Yes

1.0

Can shareholders representing 5% of Buyer’s share capital put items on the general meeting agenda?

Yes

1.0

Must Buyer's annual financial statements be audited by an external auditor?

Yes

1.0

Must Buyer disclose its audit reports to the public?

Yes

1.0

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Paying Taxes

This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as the administrative burden of paying taxes and contributions and complying with postfiling procedures (VAT refund and tax audit). The most recent round of data collection for the project was completed in May 2019 covering for the Paying Taxes indicator calendar year 2018 (January 1, 2018 – December 31, 2018). See the methodology for more information.

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What the indicators measure

Case study assumptions

Tax payments for a manufacturing company in 2018 (number per year adjusted for electronic and joint filing and payment)

  • Total number of taxes and contributions paid or withheld, including consumption taxes (value added tax, sales tax or goods and service tax)

  • Method and frequency of filing and payment

    Time required to comply with 3 major taxes (hours per year)

  • Collecting information, computing tax payable

  • Preparing separate tax accounting books, if required

  • Completing tax return, filing with agencies

  • Arranging payment or withholding

    Total tax and contribution rate (% of commercial profits)

  • Profit or corporate income tax

  • Social contributions, labor taxes paid by employer

  • Property and property transfer taxes

  • Dividend, capital gains, financial transactions taxes

  • Waste collection, vehicle, road and other taxes

    Postfiling Index

  • Time to comply with VAT refund (hours)

  • Time to obtain VAT refund (weeks)

  • Time to comply with a corporate income tax correction (hours)

  • Time to complete a corporate income tax correction (weeks)

Using a case scenario, Doing Business records taxes and mandatory contributions a medium size company must pay in a year, and measures the administrative burden of paying taxes, contributions and dealing with postfiling processes. Information is also compiled on frequency of filing and payments, time taken to comply with tax laws, time taken to comply with the requirements of postfiling processes and time waiting.

To make data comparable across economies, several assumptions are used:

  • TaxpayerCo is a medium-size business that started operations on January 1, 2017. It produces ceramic flowerpots and sells them at retail. All taxes and contributions recorded are paid in the second year of operation (calendar year 2018). Taxes and mandatory contributions are measured at all levels of government.

    The VAT refund process:

  • In June 2018, TaxpayerCo. makes a large capital purchase: the value of the machine is 65 times income per capita of the economy. Sales are equally spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per capita divided by 12). The machinery seller is registered for VAT and excess input VAT incurred in June will be fully recovered after four consecutive months if the VAT rate is the same for inputs, sales and the machine and the tax reporting period is every month. Input VAT will exceed Output VAT in June 2018.

    The corporate income tax audit process:

  • An error in calculation of income tax liability (for example, use of incorrect tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income tax underpayment. TaxpayerCo. discovered the error and voluntarily notified the tax authority. The value of the underpaid income tax liability is 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax return, but within the tax assessment period.

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Paying Taxes – Belgium

Indicator

Belgium

OECD high income

Best Regulatory Performance

Payments (number per year)

11

10.3

3 (2 Economies)

Time (hours per year)

136

158.8

49 (3 Economies)

Total tax and contribution rate (% of profit)

55.4

39.9

26.1 (33 Economies)

Postfiling index (0-100)

83.5

86.7

None in 2018/19

Figure – Paying Taxes in Belgium – Score

image

86.7

image

86.6

image

56.8

image

83.5

Payments

Time

Total tax and contribution rate

Postfiling index

Figure – Paying Taxes in Belgium and comparator economies – Ranking and Score

DB 2020 Paying Taxes Score

image

0 100

87.4: Netherlands (Rank: 22)

86.2: United Kingdom (Rank: 27)

84.3: Regional Average (OECD high income)

82.2: Germany (Rank: 46)

79.2: France (Rank: 61)

78.4: Belgium (Rank: 63)

Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the simple average of the scores for each of the component indicators, with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax and contribution rate. The threshold is defined as the total tax and contribution rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax and contribution rate below this threshold receive the same score as the economy at the threshold.

Figure – Paying Taxes in Belgium and comparator economies – Measure of Quality

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83.5

92.4

97.7

92.0

86.7

71.0

120

Index score

100

80

60

40

20

0

Belgium France Germany Netherlands United

Kingdom

OECD

high income

Details – Paying Taxes in Belgium

image

Tax or Payments

mandatory (number) contribution

Notes on Payments

Time (hours)

Statutory tax rate

Tax base

Total tax and contribution rate (% of profit)

Notes on TTCR

Social security 1.0

contributions

online

40.0

varies

gross salaries

44.51

Corporate 1.0

income tax

online

21.0

29.58%

taxable profit

10.28

Tax on interest 0.0

30%

interest income

0.77

included in other taxes

Property tax 1.0

EUR 9,000

fixed fee depending on cadastral revenue

0.44

Transport tax 1.0

EUR 1,500

fixed fee

0.07

Municipal tax 1.0

EUR 750

fixed fee

0.04

Provincial tax 1.0

EUR 750

fixed fee

0.04

Regional tax 1.0

EUR 600

fixed fee

0.03

Stamp duty 1.0

EUR 7.5 per page

0.00

small amount

Employee paid – 0.0

Social security contributions

13.07%

gross salaries

0.00

withheld

Employer holiday 1.0 social security contributions

(workers)

online

varies

108% of gross salaries

0.00

Fuel tax 1.0

included in the fuel price

0.00

small amount

Value added tax 1.0

(VAT)

online

75.0

21%

value added

0.00

not included

Totals 11

136

55.4

Details – Paying Taxes in Belgium – Tax by Type

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Taxes by type

Answer

Profit tax (% of profit)

10.3

Labor tax and contributions (% of profit)

44.5

Other taxes (% of profit)

0.6

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Details – Paying Taxes in Belgium – Measure of Quality

Answer

Score

Postfiling index (0-100)

83.5

VAT refunds

Does VAT exist?

Yes

Does a VAT refund process exist per the case study?

Yes

Restrictions on VAT refund process

none

Percentage of cases exposed to a VAT audit (%)

50% – 74%

Is there a mandatory carry forward period?

No

Time to comply with VAT refund (hours)

5.0

90.0

Time to obtain VAT refund (weeks)

29.0

51.2

Corporate income tax audits

Does corporate income tax exist?

Yes

Percentage of cases exposed to a corporate income tax audit (%)

0% – 24%

Time to comply with a corporate income tax correction (hours)

5.5

92.7

Time to complete a corporate income tax correction (weeks)

No tax audit per case study scenario

100

Notes: Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable.

The hours for Social Security include all the hours for labor taxes and mandatory contributions in general.

The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax correction and time to complete a corporate income tax correction.

N/A = Not applicable.

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Trading across Borders

Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tariffs) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information.

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What the indicators measure

Case study assumptions

Documentary compliance

  • Obtaining, preparing and submitting documents during transport, clearance, inspections and port or border handling in origin economy

  • Obtaining, preparing and submitting documents required by destination economy and any transit economies

  • Covers all documents required by law and in practice, including electronic submissions of information

    Border compliance

  • Customs clearance and inspections

  • Inspections by other agencies (if applied to more than 20% of shipments)

  • Handling and inspections that take place at the economy’s port or border

    Domestic transport

  • Loading or unloading of the shipment at the warehouse or port/border

  • Transport between warehouse and port/border

  • Traffic delays and road police checks while shipment is en route

To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions:

Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 days are recorded as 22×24=528 hours). If customs clearance takes 7.5 hours, the data are recorded as is. Alternatively, suppose documents are submitted to a customs agency at 8:00a.m., are processed overnight and can be picked up at 8:00a.m. the next day. The time for customs clearance would be recorded as 24 hours because the actual procedure took 24 hours.

Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Contributors are asked to convert local currency into U.S. dollars based on the exchange rate prevailing on the day they answer the questionnaire. Contributors are private sector experts in international trade logistics and are informed about exchange rates.

Assumptions of the case study:

  • For all 190 economies covered by Doing Business, it is assumed a shipment is in a warehouse in the largest business city of the exporting economy and travels to a warehouse in the largest business city of the importing economy.

  • It is assumed each economy imports 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (defined by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000.

  • The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport or land border crossing.

  • All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process.

  • A port or border is a place (seaport or land border crossing) where merchandise can enter or leave an economy.

  • Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities.

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Trading across Borders – Belgium

Indicator

Belgium

OECD high income

Best Regulatory Performance

Time to export: Border compliance (hours)

0

12.7

1 (19 Economies)

Cost to export: Border compliance (USD)

0

136.8

0 (19 Economies)

Time to export: Documentary compliance (hours)

1

2.3

1 (26 Economies)

Cost to export: Documentary compliance (USD)

0

33.4

0 (20 Economies)

Time to import: Border compliance (hours)

0

8.5

1 (25 Economies)

Cost to import: Border compliance (USD)

0

98.1

0 (28 Economies)

Time to import: Documentary compliance (hours)

1

3.4

1 (30 Economies)

Cost to import: Documentary compliance (USD)

0

23.5

0 (30 Economies)

Figure – Trading across Borders in Belgium – Score

Time

Cost

Time

Cost

Time

Cost

Time

Cost

to

to

to

to

to

to

to

to

export:

export:

export:

export:

import:

import:

import:

import:

Border

Border

Documentary

Documentary

Border

Border

Documentary

Documentary

compliance

compliance

compliance

compliance

compliance

compliance

compliance

compliance

Figure – Trading across Borders in Belgium and comparator economies – Ranking and Score

image

100.0

image

100.0

image

100.0

image

100.0

image

100.0

image

100.0

image

100.0

image

100.0

DB 2020 Trading Across Borders Score

image

0 100

94.3: Regional Average (OECD high income)

93.8: United Kingdom (Rank: 33)

91.8: Germany (Rank: 42)

100: Belgium (Rank: 1)

100: France (Rank: 1)

100: Netherlands (Rank: 1)

Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These scores are the simple average of the scores for the time and cost for documentary compliance and border compliance to export and import.

Figure – Trading across Borders in Belgium – Time and Cost

image

1.2

Time (hours)

1

0.8

0.6

0.4

0.2

0

Export

image

Export

Time (hours) Cost (USD)

Import

Import

1.2

image

1

1

0

0

0

0

0

0

1

Cost (USD)

0.8

0.6

0.4

0.2

0

Border Compliance

Documentary Compliance

Border Compliance

Documentary Compliance

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Details – Trading across Borders in Belgium

image

Characteristics

Export

Import

Product

HS 87 : Vehicles other than railway or tramway

rolling-stock, and parts and accessories thereof

HS 8708: Parts and accessories of motor vehicles

image

Border

Belgium-Germany border crossing

Belgium-Germany border crossing

Trade partner Germany Germany

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Domestic transport time (hours)

2

2

Distance (km) 125 125

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Domestic transport cost (USD) 265 265

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Details – Trading across Borders in Belgium – Components of Border Compliance

Time to Complete (hours)

Associated Costs (USD)

Export: Clearance and inspections required by customs authorities

0.0

0.0

Export: Clearance and inspections required by agencies other than customs

0.0

0.0

Export: Port or border handling

0.0

0.0

Import: Clearance and inspections required by customs authorities

0.0

0.0

Import: Clearance and inspections required by agencies other than customs

0.0

0.0

Import: Port or border handling

0.0

0.0

Details – Trading across Borders in Belgium – Trade Documents

image

Export

Import

Commercial Invoice Commercial Invoice

Packing List CMR waybill

CMR Waybill Packing list

Intrastat Intrastat

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image

Enforcing Contracts

The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local first-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and efficiency in the court system. The most recent round of data collection was completed in May 2019. See the methodology for more information.

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What the indicators measure

Case study assumptions

Time required to enforce a contract through the courts (calendar days)

  • Time to file and serve the case

  • Time for trial and to obtain the judgment

  • Time to enforce the judgment

    Cost required to enforce a contract through the courts (% of claim value)

  • Average attorney fees

  • Court costs

  • Enforcement costs

    Quality of judicial processes index (0-18)

  • Court structure and proceedings (-1-5)

  • Case management (0-6)

  • Court automation (0-4)

  • Alternative dispute resolution (0-3)

The dispute in the case study involves the breach of a sales contract between two domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes the case from simple debt enforcement.

To make the data on the time and comparable across economies, several assumptions about the case are used:

  • The dispute concerns a lawful transaction between two businesses (Seller and Buyer), both located in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • The Buyer orders custom-made furniture, then fails to pay alleging that the goods are not of adequate quality.

  • The value of the dispute is 200% of the income per capita or the equivalent in local currency of USD 5,000, whichever is greater.

  • The Seller sues the Buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000 whichever is greater.

  • The Seller requests the pretrial attachment of the defendant’s movable assets to secure the claim.

  • The claim is disputed on the merits because of Buyer’s allegation that the quality of the goods was not adequate.

  • The judge decides in favor of the seller; there is no appeal.

  • The Seller enforces the judgment through a public sale of the Buyer’s movable assets.

Enforcing Contracts – Belgium

image

Standardized Case

Claim value

EUR 77,541

image

City Covered

Brussels

Court name Brussels Commercial Court

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Figure – Enforcing Contracts in Belgium – Score

image

Indicator

Belgium

OECD high income

Best Regulatory Performance

Time (days)

505

589.6

120 (Singapore)

image

Quality of judicial processes index (0-18)

8.0

11.7

None in 2018/19

Cost (% of claim value) 18.0 21.5 0.1 (Bhutan)

image

68.4

image

79.9

image

44.4

Time

Cost

Quality of judicial processes index

Figure – Enforcing Contracts in Belgium and comparator economies – Ranking and Score

DB 2020 Enforcing Contracts Score

image

0 100

74.1: Germany (Rank: 13)

73.5: France (Rank: 16)

68.7: United Kingdom (Rank: 34)

67.8: Regional Average (OECD high income)

64.3: Belgium (Rank: 56)

59.9: Netherlands (Rank: 78)

Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These scores are the simple average of the scores for each of the component indicators.

Figure – Enforcing Contracts in Belgium – Time and Cost

700

600

Time (days)

500

400

300

200

100

0

Time (days) Cost (% of claim value)

image

45.7

589.6

505

499

514

447 437

23.9

21.5

18.0

17.4

14.4

image

image

Belgium France Germany Netherlands OECD

high income

50

Cost (% of claim value)

40

30

20

10

0

United Kingdom

Figure – Enforcing Contracts in Belgium and comparator economies – Measure of Quality

Belgium

France

Germany

Netherlands

United Kingdom

OECD high income

image

image

2.5

1 0

4.5

2.5

3

2

4.5

3

1.5

3.5

4.5

1.5

0.5

2

3

2

5

3.5

4.5

2.5

3.2

2.4

3.6

0 2 4 6 8 10 12 14 16

Sub-Indicator Score

image

image

image

image

Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5)

Details – Enforcing Contracts in Belgium

image

Indicator

Time (days) 505

Trial and judgment 400

Filing and service 15

Cost (% of claim value) 18.0

Enforcement of judgment 90

Court fees 5

Attorney fees 10

Quality of judicial processes index (0-18) 8.0

Enforcement fees 3

Case management (0-6) 1.0

Court structure and proceedings (-1-5) 4.5

image

Alternative dispute resolution (0-3) 2.5

Court automation (0-4) 0.0

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Details – Enforcing Contracts in Belgium – Measure of Quality

Answer

Score

Quality of judicial processes index (0-18)

8.0

Court structure and proceedings (-1-5)

4.5

1. Is there a court or division of a court dedicated solely to hearing commercial cases?

Yes

1.5

2. Small claims court

1.5

2.a. Is there a small claims court or a fast-track procedure for small claims?

Yes

2.b. If yes, is self-representation allowed?

Yes

3. Is pretrial attachment available?

Yes

1.0

4. Are new cases assigned randomly to judges?

Yes, but manual

0.5

5. Does a woman's testimony carry the same evidentiary weight in court as a man's?

Yes

0.0

Case management (0-6)

1.0

1. Time standards

0.0

1.a. Are there laws setting overall time standards for key court events in a civil case?

Yes

1.b. If yes, are the time standards set for at least three court events?

No

1.c. Are these time standards respected in more than 50% of cases?

Yes

2. Adjournments

0.0

2.a. Does the law regulate the maximum number of adjournments that can be granted?

No

2.b. Are adjournments limited to unforeseen and exceptional circumstances?

No

2.c. If rules on adjournments exist, are they respected in more than 50% of cases?

n.a.

3. Can two of the following four reports be generated about the competent court: (i) time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report?

Yes

1.0

4. Is a pretrial conference among the case management techniques used before the competent court?

No

0.0

5. Are there any electronic case management tools in place within the competent court for use by judges?

No

0.0

6. Are there any electronic case management tools in place within the competent court for use by lawyers?

No

0.0

Court automation (0-4)

0.0

1. Can the initial complaint be filed electronically through a dedicated platform within the competent court?

No

0.0

2. Is it possible to carry out service of process electronically for claims filed before the competent court?

No

0.0

3. Can court fees be paid electronically within the competent court?

No

0.0

4. Publication of judgments

0.0

4.a Are judgments rendered in commercial cases at all levels made available to the general public through publication in official gazettes, in newspapers or on the internet or court website?

No

4.b. Are judgments rendered in commercial cases at the appellate and supreme court level made available to the general public through publication in official gazettes, in newspapers or on the internet or court website?

No

Alternative dispute resolution (0-3)

2.5

1. Arbitration

1.5

1.a. Is domestic commercial arbitration governed by a consolidated law or consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects?

Yes

1.b. Are there any commercial disputes—aside from those that deal with public order or public policy— that cannot be submitted to arbitration?

No

1.c. Are valid arbitration clauses or agreements usually enforced by the courts?

Yes

2. Mediation/Conciliation 1.0

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2.b. Are mediation, conciliation or both governed by a consolidated law or consolidated chapter or

section of the applicable code of civil procedure encompassing substantially all their aspects (for example, definition, aim and scope of application, desig

Yes

2.a. Is voluntary mediation or conciliation available? Yes

2.c. Are there financial incentives for parties to attempt mediation or conciliation (i.e., if mediation or No conciliation is successful, a refund of court filing fees, income tax credits or the like)?

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Resolving Insolvency

Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection was completed in May 2019. See the methodology for more information.

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What the indicators measure

Case study assumptions

Time required to recover debt (years)

  • Measured in calendar years

  • Appeals and requests for extension are included

    Cost required to recover debt (% of debtor’s estate)

  • Measured as percentage of estate value

  • Court fees

  • Fees of insolvency administrators

  • Lawyers’ fees

  • Assessors’ and auctioneers’ fees

  • Other related fees

    To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are used:

    • A hotel located in the largest city (or cities) has 201 employees and 50 suppliers. The hotel experiences financial difficulties.

    • The value of the hotel is 100% of the income per capita or the equivalent in local currency of USD 200,000, whichever is greater.

    • The hotel has a loan from a domestic bank, secured by a mortgage over the hotel’s real estate. The hotel cannot pay back the loan, but makes enough money to operate otherwise.

    In addition, Doing Business evaluates the quality of legal framework applicable to judicial liquidation and reorganization proceedings and the extent to which best insolvency practices have been implemented in each economy covered.

    Outcome

  • Whether business continues operating as a going concern or business assets are sold piecemeal

    Recovery rate for creditors

  • Measures the cents on the dollar recovered by secured creditors

  • Outcome for the business (survival or not) determines the maximum value that can be recovered

  • Official costs of the insolvency proceedings are deducted

  • Depreciation of furniture is taken into account

  • Present value of debt recovered

    Strength of insolvency framework index (0- 16)

  • Sum of the scores of four component indices:

  • Commencement of proceedings index (0-3)

  • Management of debtor’s assets index (0-6)

  • Reorganization proceedings index (0-3)

  • Creditor participation index (0-4)

Resolving Insolvency – Belgium

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Indicator

Belgium

OECD high income

Best Regulatory Performance

Recovery rate (cents on the dollar)

89.4

70.2

92.9 (Norway)

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Cost (% of estate)

3.5

9.3

1.0 (Norway)

Time (years) 0.9 1.7 0.4 (Ireland)

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Figure – Resolving Insolvency in Belgium – Score

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Strength of insolvency framework index (0-16)

11.5

11.9

None in 2018/19

Outcome (0 as piecemeal sale and 1 as going concern) 1 .. ..

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96.3

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71.9

Recovery rate Strength of insolvency framework index

Figure – Resolving Insolvency in Belgium and comparator economies – Ranking and Score

DB 2020 Resolving Insolvency Score

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0 100

89.8: Germany (Rank: 4)

84.4: Netherlands (Rank: 7)

84.1: Belgium (Rank: 9)

80.3: United Kingdom (Rank: 14)

74.9: Regional Average (OECD high income)

74.6: France (Rank: 26)

Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These scores are the simple average of the scores for the recovery rate and the strength of insolvency framework index.

Figure – Resolving Insolvency in Belgium – Time and Cost

2

Time (years)

1.5

1

0.5

Time (years) Cost (% of estate)

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1.9

9.0

9.3

8.0

1.7

1.2

1.1

6.0

0.9

1.0

3.5

3.5

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10

Cost (% of estate)

8

6

4

2

0

Belgium France Germany Netherlands OECD

high income

0

United Kingdom

Figure – Resolving Insolvency in Belgium and comparator economies – Measure of Quality

Belgium

France

Germany

Netherlands

United Kingdom

OECD high income

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6

2.5

2

1

6

3

1

1

6

3

3

3

6

2.5

2

1

5

3

2

1

5.3

2.8

2.1

1.9

0 2 4 6 8 10 12 14 16

Sub-Indicator Score

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Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4) Reorganization proceedings index (0-3)

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”

Figure – Resolving Insolvency in Belgium and comparator economies – Recovery Rate

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89.4

90.1

85.4

74.8

79.8

70.2

Recovery rate(cents on the dollar)

100

90

80

70

60

50

40

30

20

10

0

Belgium France Germany Netherlands United Kingdom OECD high income

Details – Resolving Insolvency in Belgium

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Indicator

Answer

Score

Proceeding

reorganization

Mirage's management is obligated to commence insolvency proceedings within 1 month from the moment Mirage stops paying its debts (art. 9 of the Bankruptcy Law). Mirage's management will request judicial reorganization, because it wants to keep the company operating. This will allow Mirage's directors to remain in charge of the business during the proceedings and to continue operations and preserve employment. Once request for judicial reorganization is made, all enforcement proceedings will be stayed for 6 months. If necessary, the moratorium period may be extended by court decision to up to 12 months in total. During that time, Mirage will prepare and present a reorganization plan that will then need to be approved by a majority of the creditors representing more than 50% of the outstanding undisputed claims. If approved by the creditors and the Commercial Court, the reorganization plan will be binding on all creditors. The reorganization plan may involve the reduction and/or postponement of the claim of unsecured creditors. With respect to the secured creditor, the reorganization plan cannot provide for a reduction of its claim. However, it can provide for the suspension, without its express consent, of its rights (with regard to the principal amount) for a period of up to 24 months from the filing date of the petition, which period can be extended once for 12 months under certain conditions, without prejudice to the right of these creditors to receive interest on their claims. No other measures can be provided for in the reorganization plan without the secured creditors' express consent. If it is not possible to reach an agreement on the reorganization plan, it is always possible to convert the proceedings into a different reorganization scenario, being the court supervised transfer of the business in going concern. A reorganization with transfer of the business implies that the current owners and managers lose their business unless

they are involved in the NewCo acquiring the business.

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Time (in years)

0.9

Mirage's management will file a request for initiation of judicial reorganization. Then a hearing before the Brussels Commercial Court will be held within 14 days of the application being made (article 24 of the Continuity Act). Within 8 days following the first hearing, the Commercial Court will decide on the opening of the reorganization proceedings and the duration of the moratorium period. The initial moratorium period may last maximum for 6 months and can be extended by court decision for another 6 months period. Except for very specific circumstances, it cannot be further extended. During the moratorium period, the debtor will draw up a list of all claims and securities in relation to those claims and submit it to the creditors within 14 days from the date when the moratorium is grated. Creditors review the information and, if there is any disagreement, it must be resolved in court. Within the said moratorium period, the reorganization plan must be approved by the creditors and, subsequently, by the Commercial Court. To be approved, the plan must be accepted by at least 50% of the debtors who, collectively, represent at least 50% of the total undisputed claims (in principal). If it is approved, the Commercial Court will sanction the approval. The moratorium period will lapse and the plan will enter into force. The term of the reorganization plan may not exceed five years as

from its ratification by the court.

Outcome going concern In case of successful reorganization, the hotel will continue operating. Once the reorganization plan is adopted and confirmed by the Commercial Court, Mirage's management will be able to continue operating the business as long as they satisfy their obligations under the plan. If the hotel is sold within the framework of a transfer of the business, it will continue operating in a new vehicle.

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Recovery rate

(cents on the dollar)

89.4

Cost (% of estate) 3.5 Major expenses will include attorneys' fees (1.5%), remuneration of other professionals involved in the proceedings, such as accountants and assessors (1.6%), and court fees (0.4%).

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Details – Resolving Insolvency in Belgium – Measure of Quality

Answer

Score

Strength of insolvency framework index (0-16)

11.5

Commencement of proceedings index (0-3)

2.5

What procedures are available to a DEBTOR when commencing insolvency proceedings?

(a) Debtor may file for both liquidation and reorganization

1.0

Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor?

(b) Yes, but a creditor may file for liquidation only

0.5

What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a) Debtor is generally unable to pay its debts as they mature (b) The value of debtor's liabilities exceeds the value of its assets

(a) Debtor is generally unable to pay its debts as they mature

1.0

Management of debtor's assets index (0-6)

6.0

Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor?

Yes

1.0

Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts?

Yes

1.0

Does the insolvency framework allow avoidance of preferential transactions?

Yes

1.0

Does the insolvency framework allow avoidance of undervalued transactions?

Yes

1.0

Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings?

Yes

1.0

Does the insolvency framework assign priority to post-commencement credit?

(b) Yes over ordinary unsecured creditors but not over secured creditors

1.0

Reorganization proceedings index (0-3)

1.0

Which creditors vote on the proposed reorganization plan?

(b) Only creditors whose rights are affected by the proposed plan

1.0

Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation?

No

0.0

Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally?

No

0.0

Creditor participation index (0-4)

2.0

Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative?

No

0.0

Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor?

No

0.0

Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative?

Yes

1.0

Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims?

Yes

1.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”

image Employing Workers

Doing Business presents detailed data for the employing workers indicators on the Doing Business website (http://www.doingbusiness.org). The study does not present rankings of economies on these indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business.

The most recent round of data collection was completed in May 2019. See the methodology for more information.

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What the indicators measure

Case study assumptions

Hiring

(i) whether fixed-term contracts are prohibited for permanent tasks; (ii) maximum cumulative duration of fixed-term contracts;

(iii) length of the maximum probationary period; (iv) minimum wage;(v) ratio of minimum wage to the average value added per worker.

Working hours

(i) maximum number of working days allowed per week; (ii) premiums for work: at night, on a weekly rest day and overtime;

(iii) whether there are restrictions on work at night, work on a weekly rest day and for overtime work; (iv) length of paid annual leave.

Redundancy rules

(i) whether redundancy can be basis for terminating workers; (ii) whether employer needs to notify and/or get approval from third party to terminate 1 redundant worker and a group of 9 redundant workers; (iii) whether the law requires employer to reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment.

To make the data comparable across economies, several assumptions about the worker and the business are used.

The worker:

  • Is a cashier in a supermarket or grocery store, age 19, with one year of work experience.

  • Is a full-time employee.

  • Is not a member of the labor union, unless membership is mandatory.

    The business:

  • Is a limited liability company (or the equivalent in the economy).

  • Operates a supermarket or grocery store in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Has 60 employees.

  • Is subject to collective bargaining agreements if such agreements cover more than 50% of the food retail sector and they apply even to firms that are not party to them.

  • Abides by every law and regulation but does not grant workers more benefits than those mandated by law, regulation or (if applicable) collective bargaining agreements.

Redundancy cost

(i) notice period for redundancy dismissal; (ii) severance payments, and (iii) penalties due when terminating a redundant worker. Data on the availability of unemployment protection for a worker with one year of employment is also collected.

Employing Workers – Belgium

Details – Employing Workers in Belgium

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Answer

Hiring

Fixed-term contracts prohibited for permanent tasks? No

Maximum length of a single fixed-term contract (months) No limit

Maximum length of fixed-term contracts, including renewals (months) No limit

Minimum wage applicable to the worker assumed in the case study (US$/month) 2399.1

Maximum length of probationary period (months) 0.0

Ratio of minimum wage to value added per worker 0.4

Working hours

Standard workday 7.6

Maximum number of working days per week 6.0

Premium for night work (% of hourly pay) 0.0

Premium for work on weekly rest day (% of hourly pay) 0.0

Premium for overtime work (% of hourly pay) 50.0

Restrictions on night work? Yes

Restrictions on weekly holiday? Yes

Restrictions on overtime work? No

Paid annual leave for a worker with 1 year of tenure (working days) 20.0

Paid annual leave for a worker with 5 years of tenure (working days) 20.0

Paid annual leave for a worker with 10 years of tenure (working days) 20.0

Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 20.0

Redundancy rules

Dismissal due to redundancy allowed by law? Yes

Third-party notification if one worker is dismissed? No

Third-party approval if one worker is dismissed? No

Third-party notification if nine workers are dismissed? No

Third-party approval if nine workers are dismissed? No

Retraining or reassignment obligation before redundancy? No

Priority rules for redundancies? No

Priority rules for reemployment? No

Redundancy cost

Notice period for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 8.0

Notice period for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 18.0

Notice period for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 33.0

Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 19.7

Severance pay for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 0.0

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Severance pay for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 0.0

Severance pay for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 0.0

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Unemployment protection after one year of employment? No

Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 0.0

Business Reforms in Belgium

From May 2, 2018 to May 1, 2019, 115 economies implemented 294 business regulatory reforms across the 10 areas measured by Doing Business. Reforms inspired by

Doing Business have been implemented by economies in all regions. The following are reforms implemented since Doing Business 2008. image=Doing Business reform making it easier to do business. image = Change making it more difficult to do business.

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DB2020

image Starting a Business: Belgium made starting a business easier by eliminating the paid-in minimum capital requirement.

image Paying Taxes: Belgium made paying taxes less costly by reducing the corporate income tax rate, increasing the notional interest deduction rate and decreasing the rates for social security contributions paid by employers.

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DB2019

image Getting Electricity: Belgium made the process of getting electricity faster by improving access to information about the connection process and reducing the time for connection works.

image Getting Credit: Belgium strengthened access to credit by implementing a new Pledge Law which allowed security interest to automatically attach to the proceeds of the original asset, and out of court enforcement of the security interest. Belgium also established a unified and modern collateral registry.

image Resolving Insolvency: Belgium made resolving insolvency easier by streamlining the insolvency framework, expanding the scope of the law and introducing new preventive measures.

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DB2018

image Paying Taxes: Belgium made paying taxes less costly by reducing the social security contributions rates paid by employers.

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DB2016

image Registering Property: Belgium made transferring property easier by introducing electronic property registration.

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DB2015

image Resolving Insolvency: Belgium made resolving insolvency more difficult by establishing additional requirements for commencing reorganization proceedings, including the submission of documents verified by external parties.

Employing Workers: Belgium increased the notice period for redundancy dismissals.

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DB2012

image Registering Property: Belgium made property registration quicker for entrepreneurs by setting time limits and implementing its “e-notariat” system.

image Trading across Borders: Belgium made trading across borders faster by improving its risk-based profiling system for imports.

Employing Workers: Belgium increased the severance payment obligation.

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DB2011

image Registering Property: Belgium’s capital city, Brussels, made it more difficult to transfer property by requiring a clean-soil certificate.

image Resolving Insolvency: Belgium introduced a new law that will promote and facilitate the survival of viable businesses experiencing financial difficulties.

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DB2010

image Registering Property: Belgium made transferring property easier by setting statutory time limits for some procedures.

image Paying Taxes: Belgium made paying taxes easier for companies by making electronic filing mandatory for medium-size businesses.

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DB2009

image Enforcing Contracts: Belgium improved the process for enforcing contracts by establishing as a standard procedure the setting of binding time limits for the submission of written pleadings and by tightening deadlines for the delivery of expert opinions.

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DB2008

image Starting a Business: Belgium made starting a business easier by making an electronic registration and publication system available to all notaries. This system introduced a single registration number as well as automatic publication in the state gazette of the incorporation notice.

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