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Commercial Property

Belgium

Belgian real estate investment trusts have a maximum debt ratio of 65% and, to preserve their near-exemption from corporate taxation, must distribute at least 80% of net profits to shareholders. This may conflict with the rule that a company cannot distribute a shareholder dividend if its net assets have fallen below the share capital. A draft decree promises structural reform to allow investors to capitalise on a recovering market.

Company & Commercial

Belgium

The Pre-contractual Information in the Framework of Commercial Cooperation Agreements Act 2005 protects the economically weaker party in certain commercial partnership agreements. Although this legislation is not unique, it often gives rise to surprise, disbelief and specific questions.

The starter public limited liability company was supposed to be the corporate vehicle for tough economic times - a home-grown alternative to the UK limited company and Germany's 'mini-Gmbh'. However, it is arguable that its limited advantages fail to outweigh its drawbacks. If so, where do the problems lie?

A law has been passed whereby at least one-third of members of boards of directors of listed companies (and certain autonomous state undertakings) must be "of the minority gender" - in the case of most companies, this means women. Companies affected by the law should be aware of their main obligations and the penalties for non-compliance.

Several members of Parliament have proposed legislation that would further restrict the variable remuneration awarded to directors and other senior managers of listed companies and autonomous state enterprises. Although it is far from certain that the proposals will become law, they clearly indicate that the battle over big bonuses is far from over.

A new act transposes the EU Shareholders' Rights Directive into Belgian law. It aims to strengthen shareholders' rights and solve problems relating to cross-border voting. Its provisions remove some of the obstacles that have deterred shareholders from participating in general meetings, such as geographical distance and short notice periods, by encouraging the use of new technologies.

The Unilateral Termination of Exclusive Distribution Agreements of Indefinite Duration Act will soon celebrate its 50th anniversary. The act grants Belgian distributors significant protection against unwanted or early termination of distribution agreements. However, since the act became law, the protection it offers to distributors has gradually been eroded.

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Competition

Belgium

In a long-awaited decision, the Brussels Court of Appeal has held that advice drafted by in-house legal counsel is to be considered as covered by legal professional privilege when facing an investigation under the Competition Act. The decision allows companies to oppose the seizure of documents drafted by their in-house counsel during dawn raids by the Competition Authority; however, certain restrictions apply.

The president of the Competition Council has ordered Port Real Estate, a warehouse operator in the port of Antwerp, to maintain minimum load-out rates for robusta coffee traded on the NYSE Liffe Exchange in London. The interim order follows a complaint lodged by a UK-based trader in agricultural goods, on the basis of an alleged abuse of dominant position by Port Real Estate.

The Competition Council has ruled that the adoption of a directive by the National Chamber of Judicial Officers - on the fees applicable for so-called 'amicable' (ie, pre-judicial) collection - infringed the Competition Act. Among other things, the council noted that the fact that such officers exercise state authority in some tasks does not preclude the application of competition rules to extra-judicial tasks.

New fining guidelines which were recently adopted by the Competition Council aim to improve transparency for undertakings and associations of undertakings under investigation. However, the council clearly retains significant discretion when determining the size of a fine. Among other things, the guidelines leave open the issue of taking compliance programmes into account as a mitigating circumstance.

The Supreme Court has issued a succinct judgment on the scope of the Court of Appeal's powers to overturn Competition Council decisions and the nature of proceedings before the council. This is the latest decision in a case that began in 1995 with complaints filed by 12 independent motorcycle distributors in Belgium against five official importers of motorcycles, including Honda Belgium.

The Competition Council has clarified the application of the five-year limitation period under the Competition Act. In annulling a decision to dismiss a complaint regarding alleged abuse of dominant position, it held that the five-year period does not begin until a continuous infringement has ended.

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Corporate Finance/M&A

Belgium

Since the start of 2009 financial assistance has been allowed in Belgium on certain conditions. However, the new rules have been received unenthusiastically because some of the conditions are considered too burdensome, particularly the requirements to make public the price of the share transfer and to create an unavailable reserve for an amount equal to the aggregate financial assistance.

Healthcare & Life Sciences

Belgium

The government has implemented a strict regulatory framework for genetically modified organism field trials. But what happens when one of the players fails to respect the rules? Does it affect the valid work that has already been done by others? These questions recently arose before the Ghent Court of First Instance in the context of expedited civil proceedings initiated by Greenpeace against the Belgian state.

The Brussels Court of Appeal recently ruled that a parallel importer did not properly notify a pharmaceutical trademark holder when it provided a two-dimensional mock-up of the outer packaging, rather than an actual sample, of the repackaged pharmaceutical as it would be presented on sale. The decision provided much-needed clarity, as the first instance court had issued contradicting decisions on the matter.

The Brussels Commercial Court has dismissed Pfizer's misleading claims directed against an advertisement for a generic product marketed by Eurogenerics, as well as Eurogenerics's counterclaim regarding the marketing of Pfizer's own generic product. The court's relaxed views on doctors' awareness of the regulations on reimbursement and their implications will be of interest to pharmaceutical marketeers.

Intellectual Property

Belgium

The Brussels Court of Appeal recently ruled that a parallel importer did not properly notify a pharmaceutical trademark holder when it provided a two-dimensional mock-up of the outer packaging, rather than an actual sample, of the repackaged pharmaceutical as it would be presented on sale. The decision provided much-needed clarity, as the first instance court had issued contradicting decisions on the matter.

In a criminal case involving Nintendo, a Belgian court examined for the first time the legal status of devices known as 'linkers', which circumvent technological protection measures. The court held that the sole function of linkers is to circumvent such measures - dismissing the defendants' argument that they were intended for other purposes - and that these devices therefore breach IP laws.

A recent decision of the Mons Court of Appeal confirmed that where no IP right protects a product or service, unfair competition law may not be used to fill the gap. Although the court found that in principle, an assortment of products may be freely copied in the absence of IP protection, the related circumstances of the offer can be prohibited if they are likely to create confusion for consumers.

The Commercial Court of Brussels has upheld a complaint by Belgian brewer Alken-Maes against the packaging chosen by rival brewer Anheuser-Busch InBev for its Jupiler Blue beer, finding that AB InBev had infringed Alken-Maes's abstract colour trademark. AB InBev was given one month to withdraw every can and bottle of Jupiler Blue from the Belgian market.

Responsible Young Drivers (RYD) is a road safety organisation and the owner of the trademark RESPONSIBLE YOUNG DRIVERS. Its former advertising agency used the term - replaced, after RYD's objection, with the name 'The Night Riders' Mob' - in a competition for marketing students. The Brussels Court of Appeal recently considered whether such use constituted trademark infringement.

A breeders' exemption essentially allows a breeder to use plant material from a protected variety for the purpose of breeding other varieties. French, Swiss and German patent laws now contain statutory exemptions, but these cover only the act of breeding, not subsequent commercialisation. The situation in Belgium is different and arguably makes a separate breeders' exemption unnecessary.

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International

A new top-level domain space is intended for companies in the adult entertainment industry, but may cause problems in other sectors for well-marketed brands with carefully fostered reputations. In opting for preventive measures or a 'wait and see' approach, each trademark holder has a business decision to make.

Trade & Customs

Belgium

The Brussels Court of Appeal has ruled on action by a number of slaughterhouses and livestock exporters to claim reimbursement from a municipality and the Belgian state for para-fiscal charges which were paid as part of a state aid package that was later annulled by the European Commission. The Supreme Court has also considered questions arising from the scheme.