According to the Law of March 2, 1989 concerning the disclosure of large holdings in listed companies and regulating take-over bids, any natural or legal person acquiring securities or shares of a Belgian company listed on a European stock exchange in such a way that the proportion of the voting rights directly or indirectly held would reach at least 5%, shall disclose this fact to the Belgian Banking and Finance Commission. Any person increasing his holding above a level of 10%, 15%, 20%, and so on by increments of five points, shall likewise disclose this fact to the Banking and Finance Commission. These thresholds may be lower by virtue of provisions in the articles of incorporation of the company at hand.

The same disclosure is to be made in case of transfer of shares or securities when the voting rights held by a shareholder fall below one of the above thresholds.

This obligation lying upon the shareholders of Belgian listed companies is know as the "transparency obligation".

Disclosure statements must be made in writing to the Banking and Finance Commission. Standard pre-printed forms are available from the Commission, but free statements (i.e., letters) are also accepted.

The disclosure statements must reach the Commission at the latest on the second business day following the acquisition or disposal of shares that triggers the disclosure obligation.

The company whose shares are sold or purchased must also be informed within the same time-frame.

Disclosure statements must be made public by the company at hand and disclosed in its annual accounts, and must also be published in the financial press.

Criminal sanctions are imposed upon persons infringing this "transparency law". In addition, the voting rights attached to the shares held in violation of these provisions are suspended and the holders of these shares are prevented from voting during general meetings.

Special rules apply to shareholdings in credit institutions, financial institutions and insurance companies. Changes in shareholdings in these companies must be approved before they are carried out, either by the Banking and Finance Commission (for credit or financial institutions) and by the Insurance Office (for insurance companies).

The content of this article is intended to provide general information on the subject matter. It is therefore not a substitute for specialist advice.

De Bandt, van Hecke & Lagae - Brussels. (32-2)517.94.47.
For further information contact Vincent Macq on + 32.2. 517.94.47.