If your company is not among the 37.6% of companies (figures as at 30/06/2023) that have already aligned their articles of association with the CCA, it’s imperative to take prompt action! The deadline of 31/12/2023 is approaching fast!
In May 2019, the new Code on Companies and Associations (CCA) came into force with a threefold mission: enhanced flexibility, modernization and simplification of the legal framework that governs companies and associations.
For companies established after this date, compliance is straightforward as they have operated under the purview of the CCA since their inception. Companies incorporated prior to 1 May 2019 are subjected to the CCA since 1 January 2020.
Moreover, these companies are obliged by the legislator to align and harmonize their articles of association with the provisions of the CCA by December 31, 2023.
If they fail to do so, the members of the administrative body of the non-compliance company could be held personally liable for any damages suffered by the company or by third parties as a result of non-compliance with this obligation.
Taking into account the specific situation of your company, we can help you to determine whether a simple cosmetic update of your articles of association is sufficient (adaptation of the terminology, reference to the new provisions of the CCA, etc.) or whether a thorough revision of the articles of association may be worthwhile, or even necessary. To facilitate this assessment, you should consider the following factors:
There is a tendency to keep the changes to the strict legal minimum, leaving the notary to carry out a simple legal clean-up when a more complete overhaul of the articles of association would have been necessary.
The compulsory updating of your articles of association is not just a legal formality, but should represent a real opportunity to engage in in-depth reflection with your shareholders on the governance of your company, the delimitation of the role of each stakeholder and the sharing of power between the various bodies, the rules governing entry and exit at shareholder level, dividend policy, transfer to nextgen, valuation rules, rules concerning transparency and reporting of information from the administrative body to the shareholders, conflict resolution mechanisms, and much more.
Deminor NXT offers you comprehensive support in the process of updating your articles of association in line with the CCA and/or a more complete overhaul of the rules governing the organization of your company at all levels.
Please do not hesitate to contact Johan Luntumbue for further information.