15 Experts on the Opportunities and Challenges of Starting a Business in Belgium
The Challenges of the Belgian Company Register and more
Extolled by foodies who rave about the country’s chocolate, beer and frites, and appreciated by travellers for its excellent transportation system, Belgium is also a favourite of expatriate entrepreneurs and foreign investors.
In fact, the team at Startup Overseas calls Belgium “one of the most amiable business environments in the EU.” They specifically cite its open and liberal economy, one in which domestic and foreign businesses are treated equally under the law as to rights and obligations.
Opportunities and Challenges of Doing Business in Belgium
There are other reasons, too, that Belgium is popular with foreigners who wish to start or invest in a business abroad. Lawyers Belgium, a service that helps both expats and foreigners invest in, start up or expand companies in Belgium, writes that other benefits include:
- a dynamic tax system, which anticipates and adapts to economic changes;
- a workforce with talent that is both skilled and qualified;
- an international network of double tax treaties (reducing double taxation); and
- a business environment designed to attract foreign investment.
The American Chamber of Commerce in Belgium, AmCham Belgium, recently reported that the Belgian government is attempting to solve “two of the biggest hurdles facing startups in Belgium: access to seed capital and the high cost of labor.” If these tax incentives are passed, they will join the several private initiatives encouraging entrepreneurship already in existence, and make the business environment that much more welcoming.
Types of Legal Entities in Belgium
There are several types of companies that foreigners can open in Belgium. These are set out in the Belgian Commercial Code and include the following:
- private limited liability company
- public limited company
- cooperative company (limited and unlimited liability)
- various partnerships
Details on minimum share capital required, if any, can be found at Lawyers Belgium and Company Formation Belgium, another service that can help you set up your company, which can also include a branch office or subsidiary of a foreign parent company.
If you are already living in Belgium when you decide to start a business (which can be working as a freelancer or as a self-employed worker), or if you decide to buy an existing one, the process is somewhat simplified. Those who are not residents of the country and who are citizens outside of the European Union, the European Economic Area and/or Switzerland, will need to obtain a professional card.
Legal expert Emmanuel Ruchat writes at HG.org that your application will be assessed by the Department of Economical authorisations as to the impact your investment or business will have. Criteria looked at include: “response to economic need, job creation, investment useful economic impact on businesses located in Belgium, or opening export of innovative activity or specialisation.”
Obtaining a professional card, Ruchat adds, is one of the best ways to obtain Belgian resident status. The other two are getting either a work permit or a wealth card, the latter being proof that you have the financial means of supporting yourself without being employed.
There are a few other requirements with respect to being self-employed or working as a freelancer in Belgium. On its information page, Expatica lists these:
- You must be over 18 years of age.
- You must register your business and obtain a company number.
- You may be asked to provide proof of skills or education.
- You must register with a social security fund.
- You should open a business bank account.
Simply put, writes the team at AngloInfo, “foreigners can start a business in Belgium as long as they meet the minimum requirements and are entitled to work in the country. If a person meets the requirements, they can choose whether to be self-employed or to start a company. No prior government authorisation is required and there are no restrictions on the transfer of capital in to or out of Belgium.”
For a complete overview of the process, there’s a comprehensive guide issued by the Belgian government. The site itself, called Federal Public Service Economy SMEs, Self-Employed and Energy, has an enormous amount of valuable information on self-employment in Belgium, much of it in English.
Another excellent reference site is Business Belgium, where the main steps of starting any type of business are outlined, and then categorised between self-employed and various company types.
There are 3 major steps that entrepreneurs launching a commercial or industrial business in Belgium must undertake. Set out by the Doing Business project of the World Bank Group, which examines regulations in hundreds of economies, these steps are for companies with between 10 and 50 employees:
- Deposit at least 20% of the initial capital with a Belgian credit institution.
- Deposit a financial plan with the notary; sign the deed of incorporation and the by-laws for registration by the notary.
- Register with the Register of Legal Entities, VAT, and social security, and obtain a company number.
In response to a question on Quora about the costs of registering a company in Belgium, business consultant Aidan Healy, who helps businesses set up and expand overseas as managing director of Healy Consultants, says limited liability companies should expect to invest 18,550 euros in initial capital, and joint-stock corporations should expect to invest 65,550 euros. He adds:
“From my experience in Belgium, I suggest you to inject the full minimum capital during registration to ease the government approval procedure. The government may decide to raise the minimum paid up capital requirement higher if such amount is considered not enough to cover the business expenses.”
He also writes that in addition to having a business plan and corporate bank account, the company being formed must have a lease agreement in place for office space. “The Belgian government does not accept a registered address; all companies must have a physical office space.”
A Few More Services
In addition to those mentioned above, we’ve found a few other services that help foreigners establish companies in Belgium. These include:
- BridgeWest, which offers full incorporation packages and helps with setting up bank accounts, virtual offices, and accounting services. As each business is unique in some way, personal consultancies and tailored solutions form part of what they do.
- There’s also the TMF Group to look at when you need local knowledge in order to set up a new business in Belgium or streamline operations that already exist there.
- Open a European Company offers advice, as well. The teams writes that while Belgium’s recruitment sector is advanced, labor costs are high, as are employer contributions for national insurance contributions. They further advise as to which region might be best in terms of staffing for your industry, writing that “in Dutch-speaking Flanders, the most prosperous region, there is strong demand for skilled workers, particularly in IT and other technical fields. In contrast, there is an unemployment problem in French-speaking Wallonia, notably for unskilled workers.”
A Look at Languages
When it comes to doing business in Belgium, you’ve got a choice of the three official languages, Dutch, French, and German. While English is widely spoken as a second or third language, business owners may still find the multiple languages an issue.
For example, professor Pierre-Nicolas Schwab, founder of market research agency IntoTheMinds, writes about the challenges of doing research in different languages. It’s not just the matter of translation; it’s that the languages “correspond to different cultural orientations. For firms with a national marketing strategy, it’s therefore important to make sure the market research is carried out taking those cultural differences and the resulting dynamics into account.”
We reached out to Professor Schwab, asking for his best advice for expats starting a business in Belgium. “Learn Dutch and French,” he said. “Learn the mother tongue of your clients. Talk to their hearts, not to their heads.”