The COMI (Center Of Main Interest) in insolvency law in Belgium

With regard to the EIR, the Belgian jurisprudence is very limited. However, a recent decision from the Court of Appeal in Liege gives a good overview of the Belgian courts’ interpretation of Art. 3 para 1 of the EIR. In this case the principles as set out in the Eurofood case of the European Court of Justice were followed [Court of Appeal of Liège 28 April 2011, T.B.H. 2012 / 2, February 2012, pp. 165-172].

By a judgment of 10 November 2010, the Commercial court of Verviers opened a procedure of judicial reorganisation by collective agreement in favour of Delos France SARL. The Public Prosecutor contested on appeal the competence of the Belgian Tribunal pursuant to Art. 3 para 1 of the EIR on the basis that the registered office of the company was situated in Lille and its activities were mainly conducted in France. The Defendant in the appeal (Delos France SARL) claimed among other factors that given the registered office of the company was notional, that it had no staff in France and that it was in fact managed by a management committee located in Belgium, the COMI was located in Belgium.

By stating that the presumption that the COMI is situated in the Member State where the registered office is located can only be rebutted by factors that are both objective and ascertainable by third parties, the Court confirmed the reasoning given by the ECJ in the Eurofood judgment. The fact that the correspondence received at the registered office in France was transferred to Belgium was not enough to change the COMI, as third parties were entitled to assume that because all correspondence arrived at the registered office, the COMI was situated there. Furthermore, the fact that there was no paid staff was also irrelevant as this was not verifiable by third parties. This was also the case for the de facto management in Belgium since it was not demonstrated by any documentation (that third parties could have considered). On the contrary, the fact that the company had a bank account in Lille and that the company’s letterhead only contained its French address details were objective elements from which third parties could conclude that the COMI was situated in France. The Court therefore ruled that the Belgian Courts had no territorial jurisdiction and accepted the appeal.

The Court confirmed the main proposition developed by the European Court of Justice in the Eurofood-case: the presumption that the COMI of a company is situated in the jurisdiction where its registered office is situated can be rebutted only if factors that are both objective and ascertainable by third parties (i.e. by creditors of the company) establish that the COMI should not be in the location of the debtor’s registered office.

With regard to the concept of COMI the Supreme Court censured a decision of the Court of Appeal of Mons which did not take into account objective elements of the case to decide whether the COMI was located in Belgium or not [Belgian Supreme Court 27 June 2008, J.L.M.B. 2008 / 28, pp. 1222-1226].

The Court of appeal of Mons refused to open bankruptcy proceedings in Belgium arguing that the company’s activities were only situated in France without taking into account the following facts: the company was validly registered at the Company Registry in Belgium, at the National Social Security Office and registered for VAT in Belgium, the leasing of a warehouse and office in Belgium, liabilities resulting from Belgian creditors etc. The Belgian Supreme Court overturned the decision pronounced by the Court of Appeal of Mons by judging that the Court of Appeal did not examine the objective factors of the case. The Belgian position is comparatively neutral and essentially follows the main position developed by the European Court of Justice. As noted above, it should be remembered that today only a few decisions have been made regarding COMI in Belgium.

The Belgian courts have not had many opportunities to apply the EIR. In the few cases considered in Belgium, the courts have referred systematically to the principles laid out by the European Court of Justice. The Belgian Courts do not take a protectionist view when it comes to forum-shopping.