law regarding co-property
On 1 September 2010, the law
of 2 June 2010 amending the Civil
Code in order to modernize the functioning of co-ownership came into force, at
least a major part of it. The legislator has chosen to preserve the philosophy
and basic structure of the law of
30 June 1994, but wishes to put an end to certain discussions that were
raised and to solve certain practical problems that had occurred.
The most striking innovation is
the ability to create subgroups of co-ownership, either with or without legal
In addition, some principles of
Corporate Governance are introduced within the internal organization of the
association of co-owners, such as strengthening
the position of the co-owners in the relationship between the building manager
and the co-owners, making the management of the building manager more
transparent, and by subjecting the building manager to the supervision of the
Board of Co-ownership and an external auditor.
Hereafter a number of important
modifications, but not all, will be discussed briefly.
co-properties become bigger and more complicated, there is practical need for
the possibility to create "division, i.e. the division of the common
parts in independent legal entities. This happened in practice, until the
Supreme Court (Hof van Cassatie / Cour de Cassation) stated, in a decision of 3
June 2004, that "co-owners of groups of buildings bound by the same basic
deed are not authorized to establish separate subgroups for separate buildings".
Hence the role and competence of
any subgroups established under the old law could only consist in taking
preparatory decisions relating to the decisions indentified by the general
meeting of the main association and therefore the usefulness of such sub groups
was very limited.
By virtue of the new law subgroups
with legal personality can be formed, provided that the main association of
co-ownership entails twenty lots or more. For a group of buildings this is
possible for each building. In a building with a physical division into
distinct parts, this is possible per part of the building. The establishment of
associations must be regulated in the basic deed. Moreover, the associations
are only involved in respect of the private common areas as indicated in the
basic deed. The main association of co-ownership remains exclusively
responsible for the general common areas and for the issues belonging to the
joint management of the co-ownership. Finally, for each sub group, a basic deed
and a regulation of co-ownership must be drawn up.
2. Enterprise number
Henceforth, all (sub-)
associations of co-owners with legal personality must have an enterprise number,
as any document issued by the association has to mention this number (577-5 § 1
Although associations of co-owners
are deemed to have a company number since the introduction of the Crossroads
Bank for enterprises (Kruispuntbank van Ondernemingen / Banque Carrefour des
Entreprises), many of them have not yet obtained the aforementioned number, as
this number was only granted upon the entry of new articles of association in
the public registers, or upon the entry of deeds changing the existing articles
of association, in the public registers. If the association of co-owners does
not have a company number yet, the building manager or, in its absence, the
co-owners have to submit an application without delay.
3. General Meeting of Co-owners
Each year the co-owners must hold
at least one general meeting, which takes place during the period set forth in
the co-ownership regulations. A co-owner chairs the meeting and therefore not
the building manager, unless the latter is also a co-owner.
In principle, the building manager
convenes the general meeting. The convening notice shall state the place, day
and hour of the meeting and also the agenda. The building manager shall put all
the written proposals of the co-owners, the Council of co-ownership and the
sub-associations on the agenda, provided that the building manager has received
the above mentioned proposals at least three weeks before the first day of the
period as set forth in the co-ownership regulations for holding the General
Meeting. The convening notice shall also mention how the co-owners can obtain
access to the documents with regard to the items on the agenda to be treated.
The co-owners and the Council of co-ownership may at each time inform the
building manager of the items to be included on the agenda of the general
meeting. Items that are communicated too late are treated at the following meeting.
In order to prevent abuse and to
avoid that by leaving the Meeting, the quorum is no longer reached, the
attendance quorum will only be assessed at the beginning of the meeting.
The renewed apartment law,
however, provides in a number of adjustments with regard to the proxy system.
Thus it is stipulated that a proxy can in principle only be used for one
general meeting, except if one uses a general or specific notarial power of
attorney. Furthermore, no one may accept more than three proxies, unless the
total of his votes and those of his agents is limited to 10% of the total
number of votes. Moreover, one cannot take part in the vote, even as an agent,
with a higher number of votes than the total number of votes of the other
co-owners present or represented. In addition, each proxy must contain the name
of the agent. Blank proxies are no longer possible. Finally, it should be noted
that no trustee or a person employed by the association of co-owners may
participate in the deliberations and voting with regard to his task.
In accordance with Section 577-6 §
8 subsection 2 of the Belgian Civil Code, abstentions, blank and invalid votes
are no longer considered as votes to calculate the required majority. The
foregoing puts an end to the existing controversy under the law of 30 June 1994
and a link is sought with the regulations as applicable in the parliamentary
4. Building Manager
First of all, the relationship
between the building manager and the association of co-owners has to be
recorded in a written agreement.
Furthermore, the legislator
modified the duration of the mandate of the building manager in order to break
any existing over-concentration of power. In accordance with Section 577-8 § 1
subsection 3 of the Belgian Civil Code, the mandate of the building manager
cannot be longer than three years, renewable, however, by explicit decision of
the General Meeting only. The mandate cannot be renewed tacitly. Moreover, the
law stipulates that the fact that the mandate of the building manager is not
renewed, does not itself give rise to compensation.
By means of the new law, the tasks
of the building manager are updated, refined or extended where necessary.
5. Council of co-ownership and external auditor
By virtue of the new law the
installation of a Council of co-ownership is mandatory for associations of
co-owners with at least twenty plots. This Council replaces the
"management board" and gets new responsibilities. The council,
consisting only of co-owners, is responsible for ensuring that the building
manager performs its duties properly. The Council must report to the co-owners.
To this end the Council may, after having informed the building manager, take
note and copies of any piece or document relating to the management of the
building manager or the co-ownership. In addition, the Council may receive any
other task or delegation of powers, however restricted to specific operations
and in time (one year), if the Meeting hereto decides with a majority of three
fourths of the votes, except for powers granted by law to the building manager
and the General Meeting.
Where the old law did not provide
for an external auditor function, the appointment of an external auditor is
now compulsory for all co-ownerships. His task consists in monitoring the financial management
of the building manager.
6. Transitional Provisions
Pursuant to Section 577-14
subsection 2 of the Belgian Civil Code, the current provisions contained in the
articles of association, which do not comply with the now applicable legislation,
will be replaced by the corresponding legal provisions as from the date of
entry into force of the law.`
For some provisions, a
transitional arrangement applies, which means that the new legislative changes
do not take effect immediately, but will become effective under special
Finally, the building manager
must, within the year following the entry into force of this law ( i.e. 1 September 2010, so before 1
September 2011) submit a version of the existing basic deed adapted to Sections
577-3 to 577-14 of the Belgian Civil Code, the co-ownership regulations and the
rules of procedure for approval to the General Meeting.
14 September 2010
Alain De Jonge - email@example.com
Pieter Dierckx - firstname.lastname@example.org
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