Proposition 50K1211

Projet de loi modifiant le Code des sociétés et la loi du 2 mars 1989 relative à la publicité des participations importantes dans les sociétés cotées en bourse et réglementant les offres publiques d'acquisition.

General information ¶

Submitted by

Groen Open Vld Vooruit PS | SP Ecolo MR Verhofstadt Ⅰ

Submission date

April 23, 2001

Official page

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Status

Adopted

Requirement

Simple

Subjects

stock-exchange transaction takeover bid organisation

Voting ¶

Voted to adopt

Groen CD&V Vooruit Ecolo LE PS | SP Open Vld N-VA MR FN VB

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Discussion ¶

April 17, 2002 | Plenary session (Chamber of representatives)

Full source

Mr. Speaker, Mrs. Vice-Prime Minister, Mr. Minister, Dear colleagues, I would like to clarify first that the committee has devoted 16 sessions to the examination of this bill which aims to amend the Code of Companies and the law of 2 March 1989 concerning the advertising of significant participations in publicly listed companies and regulating public offers of acquisition.

This project incorporates in Belgian law various provisions inspired by a "corporate governance" or a "good governance" of companies.

It involves two important objectives that must be emphasized: achieving a more efficient and balanced operation of companies and improving the protection of the interests of those who invest in securities issued by Belgian companies.

To do so, it grants a legal status to the board of directors, settles conflicts of interest within groups of companies, specifies the notion of responsibility of legal persons invested in an administrator mandate as well as the rules of operation of the general assembly.

To put an end to the existing legal uncertainty, the board of directors — emanating from the board of directors — is given a legal basis. A facultative delegation of the powers of the Board of Directors to a new body, the Management Committee, is established.

Then, in order to avoid profit shifts to the benefit of companies in the same group, transparency rules were developed and the concept of independent administrator was generalized. by

Furthermore, it is provided that the legal person who exercises a mandate of administrator in a company must necessarily designate a natural person who would have the same responsibility. In addition, the prohibition that a legal person cannot be an administrator is lifted. The period of convocation of the General Assembly is extended to improve its functioning. by

Another important measure that has been the subject of many debates aims to guarantee the independence of the functions of Commissioners by prohibiting them from any mandate in the companies they control.

During the discussion, various legislative proposals were discussed. They are again on the agenda.

Mr. Giet, I will interrupt you for a moment for a technical question. by Mr. Leterme tells me that listening is a bit difficult.

This is either a problem with the volume of my voice or a problem with the hearing of my voice.

As I am a little Jesuit, it can be both! Speak with a strong and masculine voice, as you can.

Mr. Speaker, I take lessons from you on the subject of Jesuitism and so I will try to push my voice a little, since Mr. Leterme is ⁇ interested in this report!

I continue my exhibition. Furthermore, in the course of the debates, the commission, aware of the importance of the proposed text, in particular in view of the economic current, decided to conduct numerous hearings. Representatives of the Belgian Federation of Companies, the Institute of Companies Auditors, the Institute of Accounting Experts and Tax Advisors, the Union van zelfstandige ondernemers, the Foundation of Directors, the Banking and Financial Commission, the Supreme Council of Economic Professions and the Royal Federation of Belgian Notaries were heard. In addition, the Laga professors of the KUL, Olivier of the Ulg and Geens of the KUL were also heard. The committee also took note of written contributions from other academic authorities.

Finally, we also heard the General Labour Federation of Belgium and the "Algemene Christelijke Vakverbond van België". by

The written report contains, of course, a summary of the various hearings. Also attached to this written report, and it is important to specify it, are the preliminary draft of the Royal Decree implementing Article 133 of the Corporate Code, a note from the Institute of Corporate Auditors entitled "The crisis of confidence concerning corporate governance and corporate auditors" and the list of provisions requiring implementation measures.

In the general discussion, I believe that the intervention of the various parliamentary groups can be synthesized as follows.

First, some considered that this project constituted a significant improvement, in particular due to its concern for mandate transparency, and considered extending its scope. They, however, desired a physical presence of the interested parties at the general assembly and advocated that the notion of independence — an essential aspect — be the subject of a comprehensive approach and a general definition.

Others, for their part, insisted on the need to maintain consistency with European regulation and drew attention to the need to maintain some self-regulation.

Some have expressed a mixed opinion on the independence of the revisor and have argued that excessive severity translates into a disadvantage compared to other countries and that a too liberal approach induces a lack of trust and transparency.

They advocated an intermediate route: the a priori control technique that determines the risks of infringing on the revisor’s independence, a procedure offering more flexibility than a strictly regulatory delimitation. For them, it would be paradoxical that the establishment of rules of excessive severity towards the revisors results in a decline in the quality of the revised while seeking to improve it.

One group supported the government’s legislative initiative, wished for the strengthening of existing self-regulation, regretted the written call to the general assemblies and questioned whether it was appropriate to maintain a body responsible for daily management, in addition to the management committee, while finding that the Institute of Corporate Auditors failed to sufficiently control its members and, if necessary, sanction them.

In addition, the emphasis has been placed on the absence of a general obligation to appoint an independent administrator, resulting in a too lax definition in this regard, especially since the current concept of administrator lacks rigor.

Finally, some welcomed the concern for the transparency of the bill and the improvement of the strength ratio between shareholders, managers and board of directors by ensuring that rules apply in practice. They also expressed their satisfaction with the provision of a legal basis for the board of directors and conflicts of interest within corporate groups. by

In contrast, they expressed concerns on a number of points, including: - the independence of the Commissioner-Reviewer which is not always guaranteed in practice; - the European framework that recommends the independence of the statutory auditors in the annual accounts; - the independence of the Commissioner-Reviewer which could be the subject of a separate parliamentary initiative. by

In addition, several parliamentarians requested clarifications regarding the independence of the Commissioner-Reviewer, compliance with this requirement of independence and the possible application of sanctions in case of non-compliance with this obligation. by

Thus, the notion of independent administrator has aroused a lot of interest and questions in order to clarify its contours. Many amendments have been submitted in this sense because this essential notion is not aimed at occasional confusion of interests but the structural situation of the administrator and his independence.

The government, on the other hand, has submitted several amendments improving the meaning and scope of some essential aspects of "corporate governance". It is also by a government amendment that the creation of an external audit committee of auditors was planned, which will be able to give an opinion on the independence of the commissioners. by

As regards the latter, the Government intends to ensure that the Royal Decree specifying the benefits deemed incompatible under Article 133 of the Company Code — this Royal Decree is annexed to the written report — comes into force at the same time as the law.

It should also be noted that the proposed law contains criminal penalties in the event that a commissioner accepts functions of administrator in the companies he has controlled.

Before I conclude, I would like to thank the committee services for the important work they have done as part of the review of this important bill which, as I said, has resulted in numerous hearings. The amended draft was unanimously adopted by the committee.

I would like to thank you, Mr. Speaker. It is very interesting, Mr. Minister, that the preliminary draft royal decree is attached to this document. This is a good way to involve Parliament in the implementation of the texts it proposes to vote on.

Mr. Speaker, Mr. Minister, colleagues, I would like to thank the rapporteur, Mr. Giet, for his comprehensive, complete and objective report.

The bill we are discussing today is ‘just in time and just in line’. It is a new milestone in corporate governance or what we call corporate governance. This bill is part of a larger set of proposals from this government to improve the business climate and strengthen entrepreneurship, which is necessary in this country. The draft legislation contains a number of important legal rules aimed at making companies transparent. I think the public is asking for that. It is also intended to strengthen the trust of investors in the companies. The bill also forms part of a series of measures such as the Law on Employee Participation, the ongoing reform of the companies and other similar bills that form a whole and should create dynamics for everyone involved in the economic process.

This bill is preceded by a month-long history. You know that under the chairmanship of Mr De Grauwe, a working group was set up to investigate the various aspects of corporate governance. The Working Group’s March 2000 report contains a whole set of recommendations that have resulted in the present draft legislation.

In the committee responsible for the issues of commercial and economic law, the draft has been extensive and discussed in a good spirit and with a non-partisan openness. The hearings have already made it possible to make some refinement to the original design. I would like to thank the representatives in the committee for their flexible arrangement. They listened to the arguments of the professionals, academics and members of the committee involved. I want to publicly thank them. I also thank the chairman and secretary of the committee and the services who have done a lot of work during the many months that the draft was discussed.

Furthermore, the various factions have worked constructively to strengthen the design in a non-politized way. The result is a balanced design that governs a number of aspects of corporate governance in an exemplary way. The draft is also in line with the new European Directive. This fundamentally improves the transparency of the management of our companies.

Since the rapporteur spoke of the specifics of the draft, I will limit myself to a few important aspects, such as addressing conflicts of interest. This latter is especially important given the internationalization and the many scandals we have faced in recent years. The draft also addresses certain gaps in existing legislation, such as the legal definition of the management committee. The positive thing is that this arrangement is optional. The rapporteur has already said that corporate governance cannot be achieved solely through legal provisions; it must also take into account the daily practice within the company. It’s about self-regulation or “soft law” that should go hand in hand with “hard law”. We have achieved this balancing exercise in the committee.

In addition, I would like to point out that the establishment of a board of directors or certain rules relating to the general assembly constitute only a legal regulation of a situation that has long existed in practice.

Mr. Speaker, Mr. Minister, Colleagues, the independence of the Commissioner has been challenged in recent years, not only in our country but worldwide, but we think about the Enron case in the United States and the implications for the audit firms and in particular for Andersen. In the United States, too, the discussion is full and it is openly advocated for a time limit for the commissioners-revisors or a so-called cooling period over time.

In any case, the division between the audit activities, on the one hand, and the consultancy activities, on the other hand, about which I had my doubts at the beginning of the discussion, comes over time to be evident and is promoted by the business itself, which proves that there is still spontaneously a kind of self-regulation taking place in the economic process. This bill reflects international trends. The draft law also contains some other good provisions, in particular with regard to the independent directors. I could quote other items, but that is not the purpose of the exercise. We have had a positive meeting for months. Mr. Speaker, Mr. Minister, colleagues, it is therefore clear that this draft receives the support of the VLD group.

However, Mr. Minister, I think we still have a lot of work to do in this committee to address certain major gaps in commercial law. The conclusion of certain files, such as those of Sabena, learns that the system of judicial settlement needs urgently to be revised.

Mr. Minister, I am the one who, with your consent, has urged to make a split in your bill that includes both leaks, bankruptcy and judicial settlement. It is urgent that we determine this matter now. It is necessary for this country to get a kind of ‘Chapter Eleven’. I hope that you will be able to realize this during this legislature.

Mr. Speaker, Mr. Minister, this project is obviously in phase with the actuality we have known in recent months, at the level of international economic activity. However, it cannot be said that it comes from a fashion phenomenon. Rather, it responds to an important need of both the business world, the business world and the political world to manage to regulate these markets. by

The concern of this project was, on the one hand, to continue to attract foreign investors by making our rules more transparent and creating trust, but also to avoid the capital of our companies being diverted by foreign shareholders in particular who invest in most of our companies. by

We have experienced fraudulent bankruptcies such as that of Lernout and Hauspie with all the social consequences that resulted from them and, in general, the need to combat the chronicity of the declining quotas of our country’s companies required changes that proved increasingly indispensable. The Enron case also reminded us that it was important to develop rules and to be able to fight the account camouflage that allowed a company to empty its capital and assets. Enron’s bankruptcy, leading to the delicescence of one of the world’s most prestigious audit firms, Arthur Andersen, confronted the business world with the need to modify, regulate differently and control both the world of listed companies and the world of auditors and all those responsible for controlling the management of companies.

The work of this committee was very interesting. It lasted several months. The hearings were rewarding and a real collaborative work through the submission of amendments and complementary contributions characterized the relationship between the representatives of the Minister and the members of the committee. by

That said, the work is, in my opinion, not finished and the situation continues to evolve. The way we try to analyze what may have happened during these huge bankruptcies shows that new measures will need to be taken at the international level as well as at the European level and therefore at the Belgian level. by

From this project, an evaluation and monitoring organization will have to take place, with a view to the necessary adaptation and to make our tools more efficient.

Moreover, we are hard confronted with the myths of total independence, to which we will never reach — for who is totally independent? and the total absence of conflict of interest. This project has led us to question how to set up arrangements to manage, in a transparent way, the conflicts of interest that may arise, either because we fulfill incompatible tasks or because we represent interests that are different from those of the company of which we are shareholders or that are different from the mission that has been entrusted to us.

On some aspects, the Ecolo-Agalev group wanted to go further in the definition of this notion of conflict of interest which, in our opinion, is not only patrimonial. Conflicts of interest may arise in a whole range of other fields as part of the mandate held in or with a company. That’s why I’m convinced that we’ll have to come back one day on this project, although I consider it represents certain advances. by

The positive elements that we draw from it are obviously the legal existence given to the board of directors, the separation of the management and the board of directors that control it, the appointment and participation of independent directors who form a kind of committee responsible for evaluating the decisions made by the company and who therefore have no personal interest in the management of the company in which they sit. The responsibility of a natural person towards the legal person also participates in the dynamics created through this project which aims to empower not only the institutions and decision-making bodies within a company but also the members of these decision-making bodies. This is especially important if we want to move towards a system that includes self-regulation in the management of conflicts of interest, because in this case it is necessary not only that the organs, but also that the individuals who make them, be responsible for the choices they make in full knowledge of the cause. by

Another point that appears to be positive, although it deserves to be re-evaluated, is the possibility for general assemblies to resort to a simplified written procedure, without being required to gather the members of the general assembly, provided that the decision is taken unanimously. A limit imposed on this possibility applies, of course, to authentic acts.

I think this will relieve many companies. At the same time, it appeared in the discussions that there was a risk in removing this moment of physical encounter between the different shareholders of this general assembly. Indeed, the fact of attending a meeting helps to better understand the issues and what is committed to. The possible side effects of this measure should be assessed. Better if there is no one.

As for the strengthening of the independence of the accounting commissioner and therefore the temporary prohibition for him to perform another function in the company for two years, we would have liked to go further. The Luxembourg Court of Justice has apparently ruled that the functions of auditor and consultant were not compatible within the same company. At the level of global management of this problem, this need to separate the two functions already appeared. I think that this aspect will probably have to be revised in a relatively short future. The work of the committee has led us to have to move forward and to realize in the current state. Per ⁇ we will have to wait for the latest developments of European and international decisions.

Finally, a Committee of Opinion and Control with legal personality shall be established, which shall, at the request of the Commissioner, issue a prior opinion on the compatibility of a service with the independence of the exercise of its functions. This is an element that we also find positive.

These are the important elements that we wanted to emphasize. There is one aspect that should also be evaluated, in my opinion. It is the royal decree that will allow to establish a list of incompatible functions. In these matters, if one wants to be effective, one must necessarily be able to follow the evolution of the situation. Therefore, it will probably also need to be evaluated at some point and ⁇ we will realize that this list no longer corresponds to reality. It will then need to be adapted or to use a principle consisting in requiring all those who have a management, control or revision mandate a statement listing everything that, in their career or in their situation, could lead to a conflict of interests. The decision-making bodies would then evaluate to what extent and to what extent this actually poses problems to them and they would then assume the decision they make. Here we join regulatory mechanisms that require prior testing of tools that can be set up.

I liked the way the work went. I found this exercise very enriching and I learned a lot. I hope that we will be able to regularly review this project, the positive effects, forgetting or gaps that may appear because we are not the only masters of the evolution of these materials.

Mr. Speaker, Mr. Minister, colleagues, the proposed bill aims to optimize the management of companies and, above all, to gain transparency. The aim is to regain the trust of the public and the institutional investors. This goal is only partially achieved. The design is a good but especially shy step in the right direction. A number of opportunities were not seized and in fact, in certain areas, one has not gone far enough.

Grosso modo, I would like to point out four reasons why we think that this bill does not actually go far enough. The first reason is the fact that this draft was especially poorly prepared by the government. This is witnessed by the fact that every article was amended in the committee. It was a good discussion in the committee and a lot of hearings have been preceded, but we must not forget that every article has been modified. A second reason why we believe this design is not going far enough is that we find that the discussion about the dual structure has gone out of the way. A third reason I would like to point out is the fact that the role of the general assembly was not discussed in sufficient depth. A fourth reason is the fact that the mandate and the task of the Commissioner-Auditor is being questioned internationally. Neither the US FAC nor the European Commission has so far drawn clear cricket lines. However, they had announced that this would be the case within a very short time. I will discuss these points further now.

The first point is that we had to do the work thoroughly in the committee. What has all been preceded by the Bill on Good Governance? The discussion on corporate governance was initiated during the previous legislature. On 17 July 1998, the Dehaene Government commissioned a working group of experts to discuss the introduction of corporate governance principles into our corporate law. This initiative of the Dehaene government was continued by this government. This government has established a new working group. Based on the report of this working group, which was submitted in March 2000, this draft was drawn up. The draft was submitted in April 2001, a year after the report of the Working Group-De Grauwe. After the hearing on this draft with the various industry actors and relevant experts, it turned out that the draft submitted could not satisfy. The hearings with the Committee on Banking and Finance — a body that cannot be suspected of subjectivity — showed that the draft submitted to the Chamber used many vague and careless terms. This could create a new source of conflict in business.

Approximately every article had to be amended by our Committee on Commercial Law and Economic Law. No article in the original design was able to resist the criticism. Apparently, the Minister of Justice had not done his job well and therefore lost a lot of time. I can understand my colleague from the VLD when he says that there is still a lot of work done in the committee. In this way we could have saved a lot of time.

This point also allows me to make some substantive considerations. Is the introduction of corporate governance into the legislation so difficult that the government took two years for it? Is this design an important issue for politics or is it a difficult issue? Let there be no misunderstanding. The corporate law and thus also this draft are quite technical issues which the party policy hardly deals with. Our work in the Committee on Commercial Law and Economic Law has shown that certain arrangements can be worked across party boundaries that would be handled differently in other committees.

Corporate governance or good governance is a concept that approximately covers the next load. It is a set of rules to promote the harmonious operation and growth of a company. It also covers the organization of the board of directors and the management of a company. Corporate governance is initially something of the business itself, something that every company must do itself to survive, something that serves their own interests. The fact that companies are managed well cannot be imposed by law. The law should ensure that companies can organize themselves properly. Corporate governance is, in our conviction, primarily a matter of self-regulation and less of a legislative intervention that, by its rigidity, cannot embrace the diversity of the situation and the constantly changing context. Self-regulation, of which there are several examples both in our country and abroad, is supported by the fact that the markets operate self-regulating. In fact, investors are willing to pay a premium of 11% for companies that adhere to the principle of corporate governance.

In addition, the hearings showed that the industry is fully aware of this. The major business organizations have already taken very good initiatives in this regard. While self-regulation in general terms should be the basis of corporate governance, this good governance must of course be enabled in the current legislation. It should be supported and it should be encouraged. The framework for corporate governance must therefore be defined by the legislature itself. The legislature must ensure the necessary transparency. Moreover, the functioning of the boards of directors and the services of the company — which is actually a matter of course — is not, in other respects, insignificant for the Belgian economy.

Due to the impact of the reference shareholding on the operation of the Belgian companies, it can be a factor in the anchoring. Independent directors are then expected to choose not for shareholder interests, but for companies established here. This can have a ⁇ positive effect on the stability of the enterprise strategy and on the strategic expansion of a enterprise. A second consideration that I would like to make with this bill concerns the fact that there has been no further discussion on the dual structure of the company. Good corporate governance requires a clear and transparent division of tasks between the various corporate forms, with mutual checks and balances. For these reasons, the draft law aims to provide a regulation for the management committee. Today, that board of directors already plays a very important role in large non-stock companies, but there is still no clear legal framework for it. At present, the Board of Directors can only be charged with the daily management, but de facto fulfils many other functions. In the absence of legal regulation, these directive committees act daily outside the boundaries of the daily management. In the best case, this is done on the basis of a prior authorization. Sometimes the Board of Directors grants that authority a posteriori. In the worst case, this happens without any legal basis.

It is a pity that the present bill addresses only the existing and confusing situation for the outside world. There is no really clearly new concept offered in this design. Companies will be able to choose ‘à la carte’ the regime that suits them. For the outside world, however, this will not give transparency and openness of governance and task distribution. However, we note that in 1979 the government in a draft proposed a full-fledged dual system in this Parliament. This was a system in which the board of directors would play the role of audit and general policy body, while the board of directors would observe the management of the company.

Equally important is the fact that in theory and in practice it is often questioned whether monism is not too deeply embedded in the Belgian customs to be able to get away from it. Therefore, I propose that we now seize the opportunity to introduce the dual system in Belgium. This is provided by the European Regulation on European Companies. This Regulation obliges the national legislature to leave the European company the choice between a clearly dualistic system and a clearly monistic system. The transposition of our right must take place before 8 October 2004. In order not to create adverse competition for the pure Belgian NVs, it is preferable that they also have the same choice. The substantive competence of a particular body, and in particular of the Management Committee, will then be much more clear to everyone.

The third consideration that I make in the draft law relates to the general assembly. The general meeting was the major absent in the debate and has actually been much too little addressed in the discussions. In large companies, most shareholders shine by their absence; in small companies, one often limits himself to investing a general meeting only on paper.

If today much attention is paid to audit, remuneration and appointment committees, it is actually about powers that belong to the general assembly. After all, the general assembly should oversee the audit and should regulate the remuneration and appointment of the board. I therefore expressly advocate for the accountability of the General Assembly.

In small family-owned companies, the annual meeting of the general assembly is usually an opportunity to explain the policy to external family members, explain the dividend policy and ensure the continuity of family shareholders. In large companies it is mainly analysts, journalists, but also pension funds, investment funds and other institutional shareholders who can take on their role in corporate governance actively in that general meeting. Also on the continent, the major reference shareholders will gradually disappear. Since institutional investors usually do not have the right or wish to sit in the board of directors because of the interests of their own participants, the general meeting is the only place where they can truly perceive the role of corporate governance.

I personally deeply regret that the Government has taken advantage of the apparent absence of the general meeting in the corporate governance debate to remove the requirement of physical presence at that meeting. In fact, the draft stipulates that the general meeting of an NGO, an NGO and a CV can be held in writing? If the decision is taken unanimously.

Fortunately, the statutory amendment was eventually removed from the draft. Fortunately, it will still have to appear physically before the notary. Whether we compare it with the possibility of keeping the boards of the board of directors in a board of directors in writing, it should be noted, however, that this faculty is primarily used in the practice of very large companies with an international board of directors — I mean, for example, video conferences held — and even there only very exceptionally. The statutes of those companies must allow this; the matter must be urgent and must be decided unanimously. Furthermore, it should be noted that even in very large companies, a board of directors is considered to meet at least four times a year, while a general meeting rarely meets more than once a year. The measure for the general assembly therefore seems justified only in very large corporate groups, with many 100% subsidiaries where the general assembly is indeed a very sterile matter.

For the rest, the introduction of the possibility of holding the general meeting in writing will result in the abolition of the body in the practice of small companies. Moreover, it is not because a prohibited practice — the mere paper meetings — means that it must be consecrated by the legislator. I am convinced that it will not be favourable to the affectio societatis and will lead to a great deal of misunderstanding for decisions which, however, later appear to have been signed. Furthermore, I would like to note that this measure excludes all shareholders. They will no longer have the opportunity to make their voice heard. Article 537 of the Company Code. The shareholders may be present at the general meeting, but in fact they do not have the right to vote.

I suggest the Chamber to consider, in the medium term, in relation to the general meeting, the attractive perspective that the Internet offers us. This will allow for virtual general meetings that will last longer than half a day and may be held more than once a year. In a global world with acute mobility problems, this form of remote engagement will increasingly be able to take the place of local presence. The quality of shareholder control can be affected. Complex questions on which one can think for a moment and which one can then answer circumstantially, are to be preferred over verbal betting games which later prove to have been unsignificant. My fourth and last comment concerns the role of the Commissioner Auditor. Several speakers before me have already cited this point. One of the objectives of the draft is to increase the independence of the Commissioner-auditor. As a goal, it is praiseworthy and enjoys our full support, but what is actually the reality with regard to the independence of the auditor? It is the task of the company auditor to audit and attest the accounts of the companies in the context of the public interest — of the employees, the creditors, the shareholders, the investors and the government. Everyone agrees that the independence of the business auditor is crucial for the added value of the profession and its social role. If the business auditor no longer performs his task independently, a confidence crisis can arise in the wider business community, which can be a problem for the whole society. The question is, of course, how the independence of the business auditor in our business economic system can be defended and guaranteed.

Professor Wymeersch situates the current problem of the business auditor in the context of the increasing importance of the additional services provided by the audit firms. The audit firms offer additional services on the basis of which they can grow their office.

At the same time, auditing has become an obstacle for them, which attracts customers but which is actually no longer profitable as an independent activity. Within the “big five” group of audit firms, audit becomes a second-class activity that weighs on the independence and expertise of the professional group.

Regarding the role of the corporate auditor, the discussion is very stormy on the international level. In the case of Lernout & Hauspie we have been able to experience how important that everything is. At the beginning of this year, the Enron issue has also been on the forefront internationally. These two incidents caused everything that existed to be thoroughly shaken together.

When you change the rules, of course, it has severe consequences, even for us in Belgium. After all, the US FAC demands that auditors under U.S. supervision comply with U.S. rules everywhere, not just in the United States. Given the business-economic reality and the fact that there are quite a few international connections, this has huge consequences for the rest of the world.

The European Commission Audit Committee is currently working on a draft recommendation on the independence of statutory auditors. Of course, Europe is also dependent on the American FAC. Europe is waiting for what will come out of the bus. In this context, it is important to report that the European Recommendation, which was announced before the end of last year, is still not completed.

The CD&V therefore strongly doubts whether it makes sense to develop a Belgian regulation apart from the international and European framework. It is only a matter of months before adjusted rules will come upon us. We feel that we should adhere to the international dynamics, even though we do not always agree entirely with what is imposed on us by the international framework. However, we can usually not underestimate it. The question we must ask is whether the current changes really affect the independence of the company auditors. That can be questioned.

Mr. Speaker, colleagues, Mr. Minister, I would like to conclude by concluding that rules of good governance are needed to restore trust. The design in question enjoys our support, but in fact it is only a small step in the right direction. It is a missed opportunity. A number of possibilities remain.

Mrs Schauvliege, Mr Lano apparently wishes to interrupt your speech.

Mrs. Schauvliege, allow me to interrupt you for a moment. You say, on the one hand, that the design is a small step in the right direction. On the other hand, you have a lot of criticism. I acknowledge that you have done positive things in the committee, but I would like to know how to combine your claim that the preparatory work was not done thoroughly enough with the benefit of self-regulation.

I need something from the liver. Everyone can hear it. The difference with companies is that a decision is taken unanimously. One brings the nose in the same direction and one begins to work. One waits there until one has some experience before making criticism. Here the ink of a design is not yet dry, and the text is barely approved, or the criticism is already beginning.

What I wanted to make clear in my presentation is that the preparatory work has not been done thoroughly enough. There were hearings in the committee during which fundamental comments were formulated. I think there is a missed opportunity. There was a committee that had to prepare the bill and apparently the work there was not done thoroughly enough. This conclusion I wanted to highlight here.

That does not prevent us from approving the bill, as it is a first step, though a shy step in the right direction. We can rightly note — and you have acknowledged it yourself — that there is still a lot of work to be done. It is important to say that this is not the end of the work, but that it is only a first step. There is still a lot of work in the store.

Mr. Speaker, Mr. Ministers, Mr. Colleagues, before me, both the positive and the negative aspects of this bill were already detailed. In my opinion, this is not a design of the missed opportunity; we are taking a step forward. But, as society is constantly evolving, the work is not over here either. In the future, of course, we will need to evaluate to what extent the changes we make today are sufficiently comprehensive to guarantee a sound corporate governance.

That is ultimately the intention and of course your intention, Mr. Lano. The presentations you held in the committee, based on your professional personal experience, were in that sense supportive and also educational. In my opinion, it is good that we also listen to people who work in the field and who can guide us in the right direction.

In corporate circles — and that can only be a pleasure for us — there has recently grown an awareness that a good corporate climate is beneficial to a good corporate governance. If one can have confidence in the business environment, it is due to the fact that the business managers, the boards of directors and all bodies fulfill their roles in a sound and decent manner.

It cannot be denied that the events of the past — colleague Schauvliege cited the case-Lernout and Hauspie and on the international level there was the affair-Enron — have caused some unrest in the public opinion and aroused mistrust about the way in which business is done today. That in itself, colleague Lano, is not good, because the well-managed and well-working enterprises are shaved over the same ham as the bad. Unfortunately, they are there too. You will be able to do so as a member of the Commission-Sabena.

The draft law approved in the committee will arrive on time. We have worked long and hard on it and dedicated very interesting hearings, where both scientists and individuals from the field came to speak. In my opinion, this interaction has resulted in a fairly good draft law. It needs to be approved today, as it can be a trigger for further expansion.

From that perspective, we, as N-VA, have constructively contributed to the design, which has also brought away our great interest, not only because of the content added value of the company management, but also because it shows that the company legislation plays a role in the anchoring of the companies and the business operation.

Colleagues, when we wrap and weigh this bill, the balance is positive for us. We can fully stand behind this project. I do not want to undermine the intrinsic value of the design, but that does not take away that we are less happy with some aspects and that we would have wanted to go further on certain points.

Strengthening the independence of the Commissioner is undoubtedly an improvement. From now on, it is forbidden for a Commissioner to work for the company controlled by him within two years of terminating his duties. Furthermore, the Commissioner’s independence from the company controlled by him will be further strengthened.

Following an amendment by our group, the Commissioner’s annual report will become more transparent and the Commissioner who breaches his independence obligation can be prosecuted. In addition, the control of the Commissioner is entrusted to an external body for advice and control, which is very important.

Mr. Minister, colleagues, one of the most important achievements of this bill is the legalization of the Executive Committee. It puts an end to the contra legem practice in which the Board of Directors delegates to the Board of Directors wider powers than the daily management. It is a good thing that corporate law is in line with the corporate law reality. In particular, a body shall be established to which more extensive powers may be entrusted than to the daily management.

We regret, however, that this necessary reform leads to a further complication of the company law. We opt for the integration of the Board of Directors and of the organ of the daily management, as there are rarely board committees that do not exercise the powers of the daily management. I think that practice will have to show to what extent what we introduce today can be transformed into reality, and whether there will be no refinement in the future.

I would like to briefly point out a few shortcomings.

You must have self-discipline. I know that ministers are indispensable, but they can also be reached in other ways.

Thank you, Mr President. Collega Schauvliege has already pointed out that our corporate law remains monistic. There is no clear distinction between the company’s policy and the control of that policy. In the Netherlands, Germany and in part also in France, where companies can choose, a dual system works. According to the underlying philosophy, management must be able to control, and the general assembly is not always the most appropriate body for this. Therefore, there is a supervisory body next to the policy body. This is not a theoretical debate. Studies have shown the link between Dutch corporate law and their greater economic performance, compared to the major Belgian companies.

Our proposal to impose a mandatory dual model on listed companies has failed. Today we regret this somewhat. Even with regard to the obligation to impose independent drivers, the design does not, in our opinion, go far enough. There is no general obligation to have an independent driver. Moreover, one is not so strict in the definition of what an independent driver is exactly.

However, we should not expect all salvation from the independence of a driver. I refer to a study by professors Van Poucke and Buelens of the Vlerick Leuven Gent Management School. At the 25th Flemish Scientific Economic Congress on 14 March 2002 in Hasselt, they proposed this. The two professors say that the board of directors provides no added value for most companies. The quality of group decision-making is very poor. Scientific research shows that the top very often makes wrong decisions and does not correct wrong decisions, and that the presence of an independent executive usually does not contribute to better decisions.

I admit that we should not expect all salvation from the independence of the directors. However, it would be a step forward, compared to the circle of friends that the boards of directors are often today.

People are then no longer asked as drivers because they know a certain well-placed person. People are no longer just sitting together and making sure that the company works properly. Nevertheless, we have tried to require companies to include one-third of independent members in the Board of Directors. However, a number of amendments have failed, such as the limitation of the number of directors to eighteen, because we find that the board of directors in non-stock companies is often an inefficient body. That is why I also referred to the study that proved this scientifically. A too extensive board of directors is not good. The directors regard themselves more as the representatives of the shareholders than as the carriers of the obligation to properly manage the company. The legal limitation of the number of boards will in any case encourage the general assembly to appoint qualified directors.

One minus is the maintenance of the ad nutum revocability of the management mandate. This means that a driver can be dismissed at any time by the general assembly, which naturally limits his freedom of movement and his independence. The risk that the manager acts as the speaking tube of the shareholders increases as a result. Therefore, we opt for the possibility of stipulating in the statutes that a driver can not be sent out simply. This can allow managers to act more from the company’s interest.

A final point that it has not achieved, but that I would like to point out for a moment, is our preference to be able to dismiss the independent driver only for justified reasons. The dismissal should not be motivated. What applies to the driver, applies a fortiori to an independent driver. Therefore, we wanted to go a step further for the independent driver by the legal limitation of his dismissal to the justified reasons.

These are some of the shortcomings of this design. I repeat what I said at the beginning. If we look at the whole context and the whole draft law, we can still say that we have now taken an important step forward. We can only hope that companies and companies can work better and more efficiently.

As a final consideration, I would like to say the following. We cannot expect everything from a better legislation. Ultimately, the work will have to continue to be done by the business managers, the directors and the members of the general assembly. This, of course, also requires personal responsibility, commitment and sufficient awareness of the task in question. When we vote for that legislative step forward, we should be able to convey as a message that the people in the field must concretely fill that law with professional seriousness, expertise and sense of responsibility. Then we will be able to grow again to a business climate that has sufficient confidence and gets in the public opinion so that we offer our business leaders who dare and want to take risks in this society in a serene climate again the possibilities and a framework.

Jean-Jacques Rousseau said, “Pour qu’une loi soit acceptée, tâchez qu’elle soit aimée.” I have constituted that the commission for the commercial right of the Chamber has tenu seize meetings in those in which she has worked with an open mind, hoping that this way will arrive at the end of this discussion. Mr. Speaker, I would like to emphasize this because, in my opinion, the problem that we know in commercial company law is due to three fields of tension. A first field of tension consists of the relations between the directors and shareholders, a second between the majority shareholders and the minority shareholders and a third between the shareholders and the stakeholders of the undertaking or all persons directly or indirectly related to the undertaking. It is of course that the legislator should play a role in making arrangements in this regard, but this role should not be exaggerated. People in the corporate world have understood this for a long time. After all, they have taken a kind of soft lawin initiatives that lead to regulating the sector. The government must only ensure that there is a minimum framework that allows not only to have a backbone, but that the soft law can also be further expanded. I have learned, Mr. le président, that this work has been possible thanks to the intervention of a commission which has been presided over by Paul De Grauwe and who a EU for but to do two things in the same time: on the one hand, on the other hand, on the one hand, on the other hand, on the one hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand, on the other hand. Mrs. Schauvliege, the only dissonant explanation I have heard today, is, in my opinion, ⁇ drawn by the hair. I can understand that there is criticism of an existing bill. I hear that the government has poorly prepared the work and that the chairman of the Corporate Governance Committee, Mr. De Grauwe, would not have done the work properly. As a measurement for this, you get the number of amendments. If that really is the measure of value, I can reassure you. I will give you some examples.

Until recently, the record of amendments in this Chamber was the major reform of the Judicial Code, led by Mr. Van Reepinghen and Mr. Krings, which is generally accepted to be one of the monuments that were successfully completed in parliamentary work. It is not because many amendments were submitted that the work was worthless. Any honest lawyer will convince you of the opposite.

I have another example. You are familiar with the famous Code of Criminal Procedure and the work of the Commission-Franchimont. This work was not only accompanied by a long preparatory phase that began in 1990, but it was also implemented in the 1998 Act. I was then chairman of the Justice Committee. I cannot propose a legislation that has brought so many comments and amendments. However, this legislation works today and proves its usefulness. Even though there were criticisms, criticisms that I have expressed here.

To say that the work is therefore not good is too much of the good. If that were the case, I am convinced that you would have taken a much more active part in the work and that you would undoubtedly have submitted a long series of amendments. When I read the report, it becomes clear what happened in reality.

Mr. Speaker, I will return to the ratio legis, because I will not repeat everything that the various speakers have done. The ratio legis of the draft law consists of winning the citizen’s confidence in the stock-oriented corporate system. In the past we put our savings in a shoe; later we put the money on a bank account and now the stock-based companies attract a lot of savings. The citizen saves through risk capital and investments. In this context, it is obvious that society creates the necessary confidence for investment forms, which are more dynamic anyway. Well, with this legislation we provide the legal instruments, though I add that the law will need to be evaluated. Some of the comments that were formulated today may become a reality in practice. That is the fate reserved for a law. The law must create the climate to ⁇ what the ratio legis aims at. If necessary, further efforts will be required.

Mr. Speaker, I will return to some essential features, including the legal organization of the Board of Directors in the Belgian Nameless Companies. The time that a board of directors is the central collective body of the Nameless Company is finally over. At a certain point, management boards and strategic committees were created. They were engaged in providing advice on strategy and control. Previous speakers have already given a number of examples where some things have gone wrong. Well, we have taken lessons from it and try to remedy the problem, without being accused of acting too urgently, so that, in fact, a free initiative within a commercial company, in particular the exploitation of the free enterprises of trade, would become one of our powers. I believe that with the present bill we will give a three-fold answer to the mentioned problems.

At the same time, we provide a legal framework for the Advisory Committee whose opinions are essential for the proper functioning of the company. Also in regards to the settlement of conflicts of interest within the group, we are making an important step forward in the trade trade through the way we handle the interests within the group in a structured manner. Those who know the companies know that there can be problems around them. The design resolves it in a rational way.

And ⁇ it is thanks to the intervention of the Commission that we have reached this result. In fact, I must confess that the hearings of various people, whether from the world of societies or from the legal world that accompanies these societies, have nevertheless brought us points of view that have prompted us to improve and refine this text. I believe that this is the great reward for the commission to see its efforts translate into such acceptance, beyond the divisions between parties.

Of course, problems have arisen in the past in terms of the independence of the Commissioners. Control by the Commissioner is somewhat the key key to the reliability of financial results. We now have a division line for those who want to sit as commissioners. We now also have elements that allow people who are engaged in this profession to follow by after a period of "cooling off" with criminal sanctions that are applicable and that give us greater guarantees. De aansprakelijkheid van de rechtspersoon bestuurder is nog een van die zaken die we in the past never on one afdoende wijze have been able to oplossen, wat tot ongelijke afwegingen van verantwoordelijkheid leidde, waarbij sommigen zich gemakkelijk van hun eigenlijke verantwoordelijkheid konden ontdoen juist door beroep te doen op deze rechtspersonen. Also today we are engaged in the care of the workplace.

In connection with the operation of the general meeting, I was surprised, colleague Schauvliege, to hear you say that I had not done enough at all. I see three things that are essential. The extension of the deadline for convening the general meeting was prevented by giving the shareholder sufficient time to prepare for the general meeting. This is the way in which a defence lesson is observed by a lawyer who asks for a postponement at the introductory hearing in order to enable him, after he has been consulted in the last instance, to better prepare himself and to better exercise his rights to defence. That is the first reason why I dare to say that your comment on the functioning of the general assembly is incorrect.

Second, it is the reference date that is introduced to allow the foreign institutional investor to also participate and above all vote at the general meeting. This is also an important basic condition that is welcomed by everyone.

Finally, there is the introduction of the written general meeting. In this way, we have actually met the aspirations of the VBO. The VBO is careless when it comes to welcoming initiatives undertaken in this area. They unanimously welcomed this. That is an important measure of value, much more than the amendments that have been adopted. The response of the Committee for Banking and Finance, which will be given a large control power, which in turn involves the strengthening of the transparency of the shareholders’ interests, was also positive following our work. And ultimately, we have saisi l'occasion pour apporter quelques modifications au Code des sociétés, modifications qui me semblaient nécessaires et qui ont été acceptées sans grandes difficultés. As a conclusion, I would like to add that there is still a lot to be done in the area of commercial and company law. In addition, there are a number of actions underway that are currently being further dealt with in the committee. These are mainly the transposition of a number of European directives where I count on the same effort and the same open mind that I encountered when dealing with this bill. Mr. Lano, I do not forget that there are a number of other issues that need to be addressed. The bankruptcy law is now under review. This morning we concluded the work in the Senate Justice Committee. The design will return to the room quite soon. There are few amendments, so I am hopeful that the evaluation review will also be able to become a reality.

However, there is another important work that also needs to be completed, an activity that in 1997 did not receive the attention it should have received. It is about the judicial agreement. I can only offer and ask to work together in the same spirit so that this point can also be arranged. Then there is a trilogy that is embodied in commercial law and in company law that will only serve the legal certainty. Legal certainty means also raising the confidence of citizens. There is to do.