I. Structure
The board of directors manages the company and takes all decisions relating to its operation. A limited liability company may have both default and collegiate management (art. 5:70 BCCA).
- Default management will be exercised by one or more directors with full powers.
- Collegial management, as the name implies, will be exercised by a collegial board of directors, whose members can only act together on behalf of the company.
This should be stated in the articles of association.
II. Day-to-day management
The belgian codes of companies and associations extends the notion of day-to-day management. The concept of day-to-day management has been extended from “urgent acts of minor importance” to “acts and decisions which do not exceed the daily needs of the company” and to “acts and decisions which, either because of the minor interest they represent or because of their urgent nature, do not justify the intervention of the board of directors” (art. 5:79, al. 2 BCCA). A clear definition of the concept of day-to-day management and what it entails can be an advantage and help to prevent managing directors from exceeding their powers.
III. The directors
LLCs may have one or more directors who may be natural or legal persons. These directors are designated in the articles of association or are appointed by the General Assembly (GA). On incorporation, the appointment may be included in the memorandum of association. The duration of the appointment may be fixed or indefinite. The director(s) are self employed within the meaning of social law. This means that they are not subject to an employment contract. In principle, the function of director is remunerated, as determined by the GA (art. 5:70 §1 et 2 CSA).
A director may resign by simple notification to the board (art. 5:70 §4 CSA). Such resignation does not need to be accepted or “deeded” to be effective. If the company so requests, the director may be required to remain in office for a reasonable period of time necessary for his replacement. The director may publish his resignation himself.
A director may also be dismissed either by amending the articles of association (for statutory directors) or ad nutum (for non-statutory directors). It is possible to provide in the articles of association that the dismissal of a director will be preceded by a notice period and will be accompanied by a “golden parachute”. However, the GA can always terminate the mandate, without notice or compensation, for just cause.
