Vol 14 (2017) - Issue 3

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Belgium: New Act on In Rem Security Interests in Movable Assets: Further Postponement of Implementation and Important Amendments

On 15 December 2016, the Belgian Parliament approved a bill (the 'Amending Act') amending the act on in rem security interests in movable assets (the 'Security Interests Act'). The Security Interests Act was adopted in July 2013, and its entry into force was originally scheduled for 1 December 2014. However, practical difficulties in setting up a national pledge register led to the postponement of its implementation. Due to further delays, the Belgian legislature decided, in the Amending Act, to postpone implementation for another year, i.e. until 1 January 2018 at the latest. The Amending Act also addresses a number of outstanding issues and introduces important changes to the Security Interests Act.


Recap of the Security Interests Act
The Security Interests Act, a much needed modernisation of the statutory framework governing in rem security interests in movable assets, codifies certain principles and introduces fundamental changes. One of the most important changes introduced by the Security Interests Act is the abolishment of the cumbersome dispossession requirement to establish a pledge of movable assets. The Security Interests Act provides for the possibility to create a pledge of movable assets through mere agreement between the parties, which can be perfected by means of either (i) filing with the national pledge register or (ii) dispossession of the pledged assets.
Furthermore, the Security Interests Act abolishes the current legislation on pledges of business assets (pand handelszaak/gage sur fonds de commerce) and allows the establishment of a pledge of individual or pooled moveable assets, whether existing or arising in the future, provided the assets are transferable. Under the new rules, the existing limitation on a pledge of business assets to 50% of inventory will no longer apply, meaning the security interest can extend to 100% of inventory. In addition, the requirement that a pledge of business assets be granted to an EU credit institution or certain type of financial institution has been abolished.
It should be noted that the Security Interests Act does not amend the Mortgage Act or the Financial Collateral Act.