On 28 June, Bill No. 6054 on non-profit organisations ("ASBLs") and foundations was voted into law. The law will enter into force in September and repeals the Law of 21 April 1928, as amended. The stated goal is to specify, adapt and simplify the existing provisions to lighten and modernize the legal framework as well as create more accounting transparency to guarantee better control.
Several amendments are to be noted:
First, the bill moves towards modernization of the governance rules. These are relaxed to take into account technical and technological developments. Convening notices to general meetings can henceforth be sent by electronic communications. General shareholder and board meetings can now also be held remotely, by videoconference for example. Annual filing with the clerk of the civil court is no longer required for changes to the ASBL's membership list, which can now be updated at the ASBL's head office.
The new rules set out in the bill bring the ASBL regime closer to that of conventional companies. For example, ASBLs may now own real estate that is not necessary for the realization of the association's corporate purpose.
Secondly, the authorization procedure has been made more transparent, and new accounting rules apply depending on the size of the association. Small associations (with fewer than 3 salaried staff, total income of up to 50,000 euros, and total assets of up to 100,000 euros) will only be subject to simplified accounting obligations, while only large associations (with more than 15 salaried staff, total income of over 1 million euros, and total assets of over 3 million euros), public utility associations and foundations will be required to provide their accounting documents to an accredited independent auditor. In terms of the accounting system, this new approach is intended to be differentiated and proportionate according to the size of the association.
Finally, with regard to restructuring associations, the bill proposes several options: transformation into a foundation, transformation into a societal impact company and merger. The first two options allow the association to change form without dissolution or the creation of a new legal entity, while the third option creates a new entity from several others (merger entails the dissolution of pre-existing ASBLs). In addition, a procedure for administrative dissolution without liquidation has been introduced.
The changes to the ASBL regime are designed to meet the requirements of the FATF recommendations. Accordingly, the transitional provisions stipulate that previously incorporated ASBLs must comply with the new text within 24 months of its entry into force. To comply with the new requirements, ASBLs will have to amend their articles of association accordingly.
