Filing for bankruptcy in Belgium: how the declaration before the enterprise court works

If your business can no longer pay its debts on a lasting basis and can no longer obtain credit, filing for bankruptcy in Belgium is not optional: the law requires you to file a bankruptcy declaration (aangifte van faillissement / aveu de faillite) with the enterprise court (ondernemingsrechtbank / tribunal de l’entreprise) yourself. Filing for bankruptcy is not a defeat but a legal step that limits further damage, both for you and for your creditors. This article explains when you must file, how it is done and what happens next.

Who can be declared bankrupt?

Bankruptcy is governed by Book XX of the Code of Economic Law (Wetboek van economisch recht / Code de droit économique). It applies to undertakings in the broad sense: self-employed individuals, including those practising a liberal profession, and legal entities governed by private law, such as a company, a non-profit association (vzw / ASBL) or a foundation.

A private individual without a self-employed activity cannot be declared bankrupt; they can, however, apply to the labour court for a collective debt settlement (collectieve schuldenregeling / règlement collectif de dettes). Anyone who has ceased their self-employed activity must in principle wait six months before doing so. A director or manager of a company does not automatically go bankrupt along with the company.

The conditions for bankruptcy

A business is in a state of bankruptcy when two conditions are met at the same time:

• cessation of payments: the business has persistently stopped paying its debts as they fall due;
• loss of creditworthiness: suppliers, banks and other creditors no longer grant extensions or credit.

A temporary cash-flow problem is not enough. If the business is still viable, judicial reorganisation (gerechtelijke reorganisatie / réorganisation judiciaire) is sometimes a better alternative.

Filing for bankruptcy: the one-month deadline

The business owner must file for bankruptcy within one month of ceasing payments. For a company or other legal entity, the management body files the declaration. This is normally done electronically via Regsol, the Central Solvency Register.

The competent court is the enterprise court for the place where the business has its centre of main interests (centrum van de voornaamste belangen / centre des intérêts principaux), presumed to be its main establishment or, for a legal entity, its registered office (Article XX.12 of the Code of Economic Law). Brussels has both a Dutch-speaking and a French-speaking enterprise court. After the filing, the court checks whether the conditions are met and, if so, declares the bankruptcy.

Filing late carries risks. Directors can be held personally liable if they continued a loss-making activity while they knew or ought to have known that there was no longer any reasonable prospect of saving the business, or if they committed a manifestly serious fault that contributed to the bankruptcy. A late filing may also later be held against you as a fault. You can read more in our article on directors’ liability in bankruptcy.

Which documents should you prepare?

A complete filing speeds up the procedure and shows your good faith. Gather the following in advance, among other things:

• your enterprise number and your identity details;
• the latest annual accounts or a recent accounting statement;
• a list of creditors with the amounts owed, and a list of customers who still owe you money;
• an overview of the assets, such as vehicles, stock and equipment;
• your bank accounts, current contracts and insurance policies;
• details of your staff.

Bankruptcy or judicial reorganisation?

Filing is not always the only way out. If the continuity of your business is threatened but the business itself is still viable, judicial reorganisation can temporarily protect you from your creditors while you prepare an agreement or a transfer. You must make that choice while there is still something to save: if the conditions for bankruptcy have been met for a long time, it is often too late.

If you have already been invited to appear before the Chamber for Enterprises in Difficulty (Kamer voor ondernemingen in moeilijkheden / chambre des entreprises en difficulté), that is a clear signal to seek advice quickly. This chamber examines the situation of businesses in difficulty and can refer the file to the public prosecutor.

What happens after the bankruptcy judgment?

The enterprise court declares the bankruptcy and appoints one or more trustees in bankruptcy (curator / curateur) and a supervisory judge (rechter-commissaris / juge-commissaire). The judgment also sets the deadline within which creditors must file their claims, normally via Regsol. If you are yourself a creditor of a bankrupt business, read our article on filing your claim.

The trustee takes over the management of the assets, draws up an inventory, sells the assets and distributes the proceeds among the creditors according to their ranking. The supervisory judge oversees the course of the bankruptcy.

You are obliged to cooperate in good faith: you hand over the accounts and all information the trustee requests, and you report any change of address.

What happens to the staff?

Bankruptcy does not in itself terminate employment contracts. The activity is sometimes continued temporarily, for example with a view to a transfer, but in most cases the trustee terminates the employment contracts. Employees file their claims in the bankruptcy and can call on the Closure of Enterprises Fund (Fonds Sluiting Ondernemingen, FSO / Fonds d’indemnisation des travailleurs licenciés en cas de fermeture d’entreprises, FFE), which, subject to conditions and within certain limits, pays their outstanding wages and indemnities.

Discharge: your fresh start

For individuals, the discharge of residual debts (kwijtschelding / effacement) is essential: creditors can then in principle no longer claim from you the debts that remained unpaid after the liquidation. For bankruptcies opened since 1 September 2023, you in principle no longer need to apply separately for discharge: it takes effect on the closure of the bankruptcy (Article XX.173 of the Code of Economic Law). At the request of any interested party, such as the trustee or the public prosecutor, the court may, however, refuse it in whole or in part if the bankrupt committed manifestly serious faults that contributed to the bankruptcy.

Certain debts, such as maintenance payments, remain due despite the discharge. In addition, assets and income you acquire after the bankruptcy judgment in principle fall outside the bankruptcy estate. Read more in our article on the discharge of debts after bankruptcy and on starting again after bankruptcy.

Your home and your private assets

With a sole proprietorship, the entire estate of the business owner in principle falls into the bankruptcy, including the home. A self-employed person who previously made a declaration of unseizability (verklaring van onbeslagbaarheid / déclaration d’insaisissabilité) before a notary can, under certain conditions, protect their main residence against creditors whose business debts arose after that declaration. Have the consequences for your home and your matrimonial property regime checked before you file.

With a company, the private assets of the directors in principle remain outside the bankruptcy. This is different in the case of a personal guarantee, personal liability of the director, and for partners with unlimited liability, such as in a general partnership (VOF / SNC). The differences are explained in our article on the bankruptcy of a sole proprietorship versus a company.

Frequently asked questions

Can I file for bankruptcy myself without a lawyer?

You can, but mistakes in timing or in the documents can have serious consequences, particularly for the directors’ liability. Advice in advance usually costs less than the risks it helps you avoid.

What if there are hardly any assets left?

You must still file. If the assets are insufficient to cover the costs of the bankruptcy, the court can close the bankruptcy more quickly for insufficient assets.

Is the bankruptcy filing public?

The bankruptcy judgment is published in the Belgian Official Gazette (Belgisch Staatsblad / Moniteur belge). The preparation of the filing with your lawyer naturally remains confidential.

Can I start a new business after bankruptcy?

In principle, yes. In serious cases, however, the court may impose a professional ban, for example on a director who contributed to the bankruptcy through a manifestly serious fault.

Novex Advocaten can assist you

We assist business owners in weighing up reorganisation against bankruptcy, with the filing and in their dealings with the trustee and the court. Also read our article on judicial reorganisation and on what happens after the bankruptcy judgment.

Call 0484 99 22 72 or email asfour@novexadvocaten.be for a confidential consultation.