With the introduction of the Code of Companies and Associations (‘CCA’), the cooperative company form (CV/SC) is now exclusively reserved for companies with a real cooperative purpose. Only companies whose main purpose is to satisfy the needs of their shareholders or interested third parties and/or to develop their economic and social activities, inter alia, by concluding contracts with them for the supply of goods, the provision of services or the execution of works, can opt for the CV/SC company form.
What does this mean for CVBA/SCRLs that were incorporated under the old Companies Code and that do not meet the new definition of ‘cooperative company’?
A mixed set of applicable legal rules
As of 1 January 2020, all mandatory provisions for private limited liability companies (BV/SRLs) in the CCA, also apply to existing CVBA/SCRLs. There is however an important exception: the rules of Book 5, Title 5, regarding the creation and preservation of a BV/SRL’s assets, do not apply to old CVBA/SCRLs.
This means that the well-known ‘share capital’ concept within CVBA/SCRLs remains unchanged, until the CVBA/SCRL has been converted into a company form provided for in the CCA. Any transaction in relation to the share capital and the protection of the share capital, such as a capital increase or capital reduction, an issuance of new shares within the variable capital, dividend distributions, the alarm bell procedure, etc., still follow the rules of the old Companies Code.
How to proceed?
By 1 January 2024, all existing CVBA/SCRLs must be converted into a company form provided for in the CCA. A simplified conversion procedure will be applicable where CVBA/SCRLs are converted into BV/SRLs. Up until the conversion, CVBA/SCRLs should prepare and file their annual accounts pursuant to the old model for companies with share capital.
Do you have any further queries relating to your existing CVBA/SCRL? Feel free to contact your PwC Legal contact person.
