Organizational forms

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De facto association

When two or more persons join forces to achieve a certain goal, this is called a de facto association. A de facto association can be considered a “club” and has a number of characteristics:

A de facto association:

Consists of different parties; from at least 2 persons.
Has a own name
Was founded on a voluntary and sustainable basis
Has a common and clear goal
It is not aimed at generating revenue for the members
Uses any profit for activities of the de facto association
Has no legal personality

The de facto association has no legal personality, and therefore no legal basis. As a result, it cannot enter into obligations, own property, or accept gifts or legacies. It is the individual members who personally commit to the obligations of the association.

The fact that a de facto association is characterised by the absence of legal personality also has a number of consequences:

The de facto association is in itself no bearer of rights and obligations
The de facto association has no equity
De January are with their private assets personally liable for the debts of the association.
There is a undivided ownership between the members of the association for the goods that are held to pursue the purpose of the association. In other words, the goods cannot be divided between the members.

It is best to choose a de facto association if:

Your association few members tent
Your association does not property possess
The activities of your association on a short period of the year (For example: you organize a big party once a year to benefit your project.)
De income and expenditure limited (As soon as your association receives and spends more money on a more regular basis, it is advisable to set up a non-profit organization.

Statutes

It is as a de facto association not required to have statutes. But it is advisable to draw up statutes or internal regulations. In these, agreements are made about the rights and obligations of the members and about the structure and working method of the association.

Your bank will also ask for a document if you want to open an account in the name of the de facto association. But unlike a vzw, you do not have to register or publish these internal statutes in the Belgian Official Gazette.

Own income, own account and own bookkeeping

The de facto association has no assets of its own. However, it is possible to organise activities as a de facto association that generate money. The income from this must then be invested in the objective of the de facto association. Any profits cannot therefore be distributed to the members.

Attention: Keep the income from your de facto association separate from your personal income. It is important that there is sufficient transparency and that there is good record of where any income comes from and what it is spent on. This can be done via a simple accountingThe law does not impose a mandatory accounting model, but it is important that you can demonstrate that the income has been used for the operation of the association.

In order to ensure this transparency, it is also advisable to a separate bank account in the name of the de facto association separate from the members' personal accounts. The bank may ask that several members of the association open and manage this account jointly in a personal capacity.

From a fiscal point of view, it is important to know that for the tax authorities, a “de facto association” does not actually exist. In principle, it is the members who could be taxed on any income from the association.

More information: www.scwitch.be

VZW, non-profit association

The big difference between a vzw and a de facto association is that a vzw has its own legal personality that is separate from that of its members. This means that the vzw has rights and obligations and members have only limited liability. The assets of their vzw are separate from their own assets.

Setting up a non-profit organisation has many advantages, but it also entails fiscal, legal and accounting obligations. These formalities also entail some costs. So ask yourself whether it is an added value for your organization to become a non-profit organization.

It is advisable to set up a non-profit organization if:

Your association often enters into agreements with financial commitments
Your association wants to own real estate in its own name
Your association wants to be recognized or wants to receive subsidies. For subsidies, you often have to be recognized by the government as a non-profit organization.
Your association will receive donations or legacies. This is only possible if the organization has legal personality.
Your association wants to hire staff.

More information and support:

Switch: Scwitch is a support centre that provides legal assistance to associations in the socio-cultural sector. On the website www.scwitch.be you will find answers to most questions about VZW legislation and useful tools to help you with the business side of your VZW. You will also find model statutes and a 'statute builder' who will guide you in drawing up articles of association.
Assist: Scwitch also offers the online management tool Assist on, with which you can observe the management of your VZW online and follow up the bookkeeping and the annual administrative obligations. The basic package costs 90 euros per year, but that can certainly be worth it.
VSD extension: Do you want permanent advice as a non-profit organisation? Then you can become a member of the Flemish study and documentation centre for non-profit organisations (VSDC). For a limited membership fee, you can always call on the advice and guidance of the VSDC for all your specific questions. In addition, you can find on www.VSDC.be also a lot of free information.

How do I set up a non-profit organization in 5 steps?

To set up a non-profit organisation, you need to follow a number of steps: reflect, draw up statutes, convene a foundation meeting and sign statutes, file statutes and publish them in the Belgian Official Gazette. They are briefly described below.

Step 1: moment of reflection: Is it necessary to set up a non-profit organisation? Setting up a non-profit organisation has many advantages, but obtaining the status entails obligations in fiscal, legal and accounting terms. In addition, the necessary formalities entail costs. It is therefore important to consider whether it is an added value for your organisation to become a non-profit organisation.
Step 2: drawing up articles of association: If it is decided to set up a non-profit organisation, statutes must be drawn up. These are the basic principles of the non-profit organisation. It is mandatory to include the following elements: 1 - The identity of the founders; 2 - The name and registered office; 3 - The minimum number of members; 4. - The description of the purpose; 5. - The manner in which members can join and withdraw; 6. - The powers and convening of the general meeting, as well as the manner in which the decisions of the general meeting are brought to the attention of the members; 7. - The manner of appointing, terminating and dismissing directors; 8. - The maximum amount of contributions or payments to be made by the members; 9. - The destination of the assets in the event of dissolution; 10. - The duration of the association.
Step 3: Founding meeting and signing of articles of association: When the statutes are on paper, you invite the member-founders to the foundation meeting. At this meeting, the statutes must be approved, unanimously (everyone must agree). The members of the Board of Directors must also be appointed. There must be as many copies of the statutes as there are member-founders. Everyone signs each copy. At this moment, the non-profit organization exists among the member-founders, but not yet for outsiders.
Step 4: filing articles of association: The next step is to file the following documents with the registry of the commercial court of the place of the registered office of the non-profit organisation: articles of association, deeds of appointment of directors, copy of the register of members.
Step 5: publish in the Belgian Official Gazette: Certain documents that have been filed must also be published in the Belgian Official Gazette. The request for publication must be made using the ad hoc form available at the registry of the commercial court and on the website of the FPS Justice. A completed cheque or proof of transfer must be enclosed with the amount required for the establishment of the non-profit organisation.
After the approval of the statutes, it may take some time before your statutes appear in the official gazette. However, from the signing of the statutes at the foundation meeting, the legal personality of the vzw applies to the members, founders and future members, and the statutes are binding for them.
In contrast to others, there is a 'provisional legal personality' as a 'non-profit organisation in formation'. The non-profit organisation acquires definitive legal personality on the day that its articles of association and the deeds of appointment of the directors are filed with the registry of the Commercial Court of the judicial district where the non-profit organisation has its registered office (and that within 30 days after approval of the articles of association).

Foundation

Foundations are non-profit organisations with a self-built and reliable source of income from a donation or capital. They have their own board, can be established by natural or legal persons and pursue educational, cultural, religious, social or other social objectives. They do this by providing support to associations, charities, educational institutions, individuals or by setting up programmes themselves.

Both a non-profit organisation and a foundation under Belgian law are non-profit associations. The big difference is that a non-profit organisation works without the contribution of its own capital. A foundation is often established by one or more persons, with contribution of own capital, that then begins to lead a life of its own. A foundation also has no general meeting of members, only a board of directors. A non-profit organization has both. A foundation must also be established by a authentic deed (via a notary) while a non-profit organization may be established by means of a private deed.

NB: In The Netherlands the term “foundation” corresponds to our term of vzw (non-profit association). The Belgian organizational form of “foundation” corresponds to the term “capital fund” in the Netherlands.

The law makes a distinction between private foundations en public utility foundations. A private foundation pursues a non-profit goal, but has a private character and is established by a notarial deed. A 'public utility foundation' must be recognized by a Royal Decree.

Foundations have been active in Belgium for a long time, but were only given a legal framework for the first time in the law of 2 May 2002. The terms 'private foundations' and 'public utility foundations' have also been legally protected since then.

Foundations are relatively unknown to the general public. To change this, more than 80 Belgian foundations have united in the 'Belgian Network of Foundations vzw'. At the 'Belgian Federation of Philanthropic Foundations vzw' you can go to for advice, legal information and guidance.

Ngo

The term NGO stands for: non-governmental organization. NGOs are organizations that are independent of the government. Internationally, it is about any autonomous citizen organization who is committed to a social goal such as health or education, for example.

In Belgium are NGOs organizations recognized by the Federal Minister for Development CooperationTo receive recognition, your organization must comply with a list of strict rules that assess the quality of your operations.

In Belgium there are 81 recognized NGOs for development cooperation. We consider all other citizen initiatives that undertake projects of international solidarity, but which have no recognition, as 4th Pillar initiatives.

A list of recognized NGOs can be found on the website of the Belgian Government.
More information about these regulations can be found on the website of the NGO federation.

To obtain NGO recognition from the Belgian government, you can apply for recognition once every 1 years. January 5, 1 is another date on which new recognitions can come into effect. You need about 2027 to 2 years to obtain recognition, so it is best to start preparing in 3.

Step 1: You check whether you meet the criteria and you indicate that you are starting the recognition procedure.
Step 2: Your organization will be thoroughly screened in 8 domains by an external agency.
If you both pass these, you can:
Step 3: Become part of a Common Strategic Framework (CSF) per country or theme you work in.
Step 4: Submit a 5-year plan in which you request subsidies from the Federal government.
Step 5: Based on all the points from the previous steps, the government decides how much subsidies it will pay to your organization from January 1, 2027 for the next 5 years.

Would you like more information about this? Contact the 4th Pillar Support Point of ngo federation.