This offers 2020 already for the commercial law and litigation practice
Lydian's Commercial & Litigation team highlights some already known novelties of 2020.
1. New rules on evidence
Modernised rules of evidence are included in Book 8 of the Civil Code. The law is adapted to today's society and its technological developments. Furthermore, it incorporates certain principles that have long been accepted by landmark jurisprudence.
Book 8 contains the modernised and updated rules of evidence and consists of three chapters:
- The first chapter 'General Provisions' includes all kinds of definitions and the general rules of the law of evidence;
- The second chapter deals with the admissibility of evidence; and
- The third chapter contains the special rules for the various means of evidence: authentic instrument, private instrument, witnesses, factual presumptions, oath etc.
The overall system of legal evidence is maintained, but slightly modified to be more flexible. The ceiling of EUR 375 is considerably raised to EUR 3,500 and the free system of proof is extended to all companies and all unilateral acts. Another important novelty is the extension of the free system of evidence, for evidence by parties against third parties.
The most important break with the old rules is the fact that the judge now has the power to redistribute the burden of proof in certain exceptional cases.
Entry into force
This legislation (Book 8 of the Civil Code) will come into force on 1 November 2020 (with a few exceptions), and will apply to future contracts. It still seems a long way off, but it is good to keep these new rules in mind already.
2. Changes in the Belgian B2B relations
On 24 May 2019, the Belgian Act of 4 April 2019 amending the Code of Economic Law with regard to (i) the abuse of economic dependence, (ii) unlawful contract clauses and (iii) unfair market practices between companies was published in the Belgian official Gazette.
- Prohibition of abuse of economic dependence
The B2B-Act prohibits the abuse a position of economic dependence affecting competition in the relevant Belgian market or in a substantial part of it. The B2B-Act explicitly provides for the cases in which there is an abuse.
- Prohibition of unfair contract terms
Similar restrictions on contract freedom to the ones already existing for B2C contracts will soon impose a general prohibition on clauses that, alone or together with other clauses, create a manifest imbalance between the rights and obligations of the parties.
This general prohibition is completed with a black list of contract clauses that are always deemed unlawful and thus prohibited.
In addition, there is a gray list, which establishes a list of terms that are presumed to be unlawful. For this gray list the undertaking can proof the lawful character of the clause, while such possibility does not exist for the clauses falling under the black list.
Read more here about this topic in our Factsheet: https://www.lydian.be/sites/default/files/uploads/news/0756_lea_factsheets_b2b_uk_0.pdf
Entry into force
The rules concerning the unfair B2B market practices already entered into force on 1 September 2019 but the other ones still have to enter into force in the course of 2020. The rules on abuse of economic dependence will enter into force on 1 June 2020. Finally, the rules on unlawful B2B-clauses will come into effect on 1 December 2020. They apply to agreements concluded, renewed or amended after said date and not to contracts that were already in force.
3. The Belgian Company Code applicable to existing companies
On 1 May 2019, a new Belgian Company Code entered into force, modifying and updating Belgian corporate law. Starting 1 January 2020, the new Company Code also applies to existing companies, making the Company Code applicable to both new and existing companies.
While a lot of the new rules introduced by the new Company Code are codifications of existing case law or updates of longstanding principles, others may be entirely novel for Belgium. In 2020, case law and legal doctrine will thus have to interpret and apply these rules. Rectifications are expected during the first months of application.
Mid December 2019 for example, a legislative proposal was already introduced for the amendment of the cap for the limitation of liability of directors. The proposal entails that art. 2:57 of the Company Code would no longer include that the cap also applies to directors’ liability in case of grave faults leading to insolvency (art. XX.225 CEL) or in case of wrongful trading (art. XX.227 CEL). According to the legislative proposal, the cap on a director’s liability should indeed never apply to faults leading to such types of liability, since they could never be qualified as occasional light faults (to which the liability cap applies). The law as it is today may therefore create uncertainty in the application of this new director’s liability cap and also open the door for abuse.
2020 will thus be of significant importance for the Belgian corporate legal framework.
4. New CEPANI rules
On 1 January 2020, the new CEPANI Rules replacing the 2013 version entered into force. The 2020 Rules (available here: https://www.cepani.be/rules/ ) provide for the following modifications:
- More clear confidentiality obligation (Article 26):
The 2020 Rules specifies that the confidentiality obligation covers “all Awards in the arbitration, together with all materials in the arbitration created for the purpose of the arbitration and all other documents produced by another party in the proceedings not otherwise in the public domain”. This should put an end to the discussions about the exact scope of the former confidentiality obligation and the documents falling under its scope.
- “Emergency arbitration” and “emergency arbitrator” (Article 27):
While it was already possible for the parties to seek for interim measures under the 2013 Rules, the 2020 Rules now adopt the terminology of other institutions for its emergency arbitration procedure.
- Expedited procedure for disputes below EUR 100.000 or if the parties agree (Article 29):
The simplified rules contained in the 2013 Rules for disputes below EUR 25.000 no longer exist and the expedited procedure is now applicable if the amount in dispute does not exceed EUR 100.000 or if the parties agree. The expedited procedure shall not apply if the parties agree to opt out or if the CEPANI decides it is inappropriate in the circumstances upon request of a party or on its own motion. The arbitral tribunal shall render the final award within four months from the date of the establishment of the procedural timetable in case of expedited procedure.
- Scrutiny of the award (Article 33):
A formal scrutiny process has been introduced the 2020 Rules: before signing any award, the arbitral tribunal shall submit it in draft form to the secretariat. The secretariat may, without affecting the arbitral tribunal’s liberty of decision, suggest modifications as to the form of the award.
- Possibility for additional award (Article 36):
The arbitral tribunal has the possibility to render an additional award on any claim or counterclaim presented in the arbitral proceedings on which it had not rendered a decision. It can do so on its own motion or at the request of one of the parties.
- Internal rules of procedure for the president, the appointment committee and challenge committee (Schedule III):
This new Schedule provides for organizational rules about the composition and appointment of the president, the appointment committee and challenge committee. It also sets out rules about their independence and impartiality and their duty of secrecy.
- Increased fees (Schedule I):
CEPANI’s administrative fees have increased from 10% to 15% of the fees and the expenses of the arbitrators as determined the scale.
Entry into force
The new CEPANI rules are applicable as from 1 January 2020. The rules (2013 or 2020) in effect on the date of commencement of the arbitral proceedings are applicable to arbitral proceedings unless the parties have expressly agreed to submit to the Rules in effect on the date of their arbitration agreement (Article 7 (1) of both 2013 and 2020 Rules).
Finally, we take this opportunity to wish you all a happy 2020!