Wendy Rombouts
09 May 2022
There is no knowing what the future has in store for us. Sometimes fate can strike in ways we would not wish for and we find ourselves in a situation in which we are no longer able to manage our capital ourselves. For an entrepreneur this can have a major impact, not only on your personal capital but also on (the continuity of) your business. An extrajudicial power of attorney (PoA) might allay your worries.
By means of an extrajudicial PoA, a person (the ‘principal’) can grant a power of attorney to a trusted representative of his choice (the ‘authorised agent’) to manage the capital when the principal himself is no longer in a position to do so. The restrictions and guidelines governing management by the authorised agent are recorded in the extrajudicial PoA. An extrajudicial PoA is in principle valid for an indefinite period.
We can think, for example, of the situation in which someone ends up in a coma after a traffic accident. Without an extrajudicial PoA, decisions can no longer be taken about that person’s capital without the intervention of the courts. By drawing up an extrajudicial PoA – also known as an ‘extrajudicial mandate’ – you can thus continue to pull the strings yourself, even when you are no longer in a position to carry out the necessary operations. In this way you not only avoid a justice of the peace or an administrator stepping in, but moreover, for example, you can continue to make the desired gift to your child, albeit under the stipulated conditions and through the agency of the trusted representative(s) you yourself have appointed.
It goes without saying that an extrajudicial PoA is a useful instrument for natural persons. But did you know that the extrajudicial PoA also has its use for entrepreneurs and their company? Of course the legal form and the undertaking’s articles of association (AoA) also play an important role here. What is possible and what are the points to which attention needs to be drawn?
Directorships
Caution is called for when it comes to directorships: provision cannot be made for the replacement and/or succession of a director in an ordinary (healthcare) PoA. What’s more, a directorship is so ‘attached’ to the person of the director (‘intuiti personae’) that it is not advisable, either, to have a third party act as the (replacement/succeeding) director by virtue of a power of attorney.
An entrepreneur wishing to make provision for a future-proof succession arrangement for his directorship is therefore best advised to examine the alternatives. Consideration can be given to the (temporary) appointment of a succeeding statutory director or provision for the possibility of the other directors acting without the legally incapacitated director’s intervention.
Voting rights at the general meeting
Nevertheless, the extrajudicial PoA does indeed have its use for entrepreneurs. As an entrepreneur you can delegate your voting rights at the general meeting via the extrajudicial PoA. In this respect it is important to check whether the company in question is an NV/SA or a BV/SRL.
In the NV/SA voting rights can be delegated, although the delegation can only relate to one or more specific meetings during a particular period. One of the aspects inherent to the healthcare power of attorney is precisely that it is valid for an indefinite term, and this therefore does not tally with the statutory provisions concerning the delegation of voting rights in an NV/SA. As an entrepreneur with an undertaking in the form of an NV/SA, you are advised to have the delegation of voting rights at the general meeting arranged for in the AOA.
The situation is different when your undertaking has the legal form of a BV/SRL. In this case all restrictions concerning delegation of voting rights at the general meeting cease to apply. In other words, as an entrepreneur/shareholder of a BV/SRL, you will be able to work out an arrangement in your extrajudicial PoA under which – in the event of your legal incapacity – your voting rights at the general meeting can be exercised by proxy by the authorised agent of your choice. It goes without saying that a extrajudicial PoA can therefore represent a substantial added value for the entrepreneurs/shareholders of a BV/SRL.
An entrepreneur’s capital is often invested in large measure in the enterprise. If you are concerned about (the continuity of) your company in the event of your possible legal incapacity in the future, a extrajudicial PoA can allay these worries.
However, the drafting of a extrajudicial PoA of this kind calls for customisation in every case, a process in which the company’s AOA also play a major role. Many companies will still have to adapt their AOA to the new Companies and Associations Code by the end of 2023. This presents the perfect opportunity to also devote some time to drafting a extrajudicial PoA customised to your and the company’s needs.