The ecosystem for rescuing Brussels businesses in distress is now well established. But it needs resources to function...
Sometimes problems can be predicted but not prevented. Such is the case with business insolvencies in Belgium, where the figures have risen sharply in recent weeks, confirming the fears long expressed by observers.
Even more than in other regions, the signs are particularly alarming in Brussels. First, there are the bankruptcies. They have been rising steadily since last September, peaking at 84 a week at the beginning of February, a very high rate which has shown no signs of declining ever since.
Crystallisation of difficulties and financial walls
In addition to these bankruptcies, other, more discreet business closures are on the increase. In particular, judicial dissolutions requested by institutional creditors, including the NSSO and the tax authorities. When combined, these figures amount to a record 3,500 business closures in Brussels in 2024
These alarming figures are in fact the result of a delayed effect, as Paul Dhaeyer, President of the Brussels commercial tribunal (business court), explains. Covid and the energy crisis were followed by inflation, wage indexation and rising interest rates. For the first few months, companies were able to cope, thanks to funding taken out earlier. But now these debts are maturing, and the most vulnerable companies have exhausted their reserves in the meantime. Faced with banks that have become more cautious and are tightening credit conditions, they no longer have the capacity to meet their immediate repayments, secure new financing or even refinance their debts.
These companies are at the end of their rope, facing an insurmountable financial wall. ‘The last few months of 2024 and the first few months of 2025 will prove to be a time when the difficulties that have been piling up in recent years will crystallise,’ explains Paul Dhaeyer, who will soon be leaving his position to preside over the French-speaking court of first instance in Brussels.
In Brussels worse than elsewhere
The severe figures for Brussels are also linked to its economic structure. More than in other regions, it has a large number of shops and businesses in catering, general contracting, real estate and transport sectors, all of which have been particularly affected. ‘They are very exposed to wage indexation. Convenience stores and grocery shops also have to respect the cold chain and have suffered from the cost of energy. Teleworking, mobility and safety problems have clearly contributed to this,’ observes Paul Dhaeyer. All in all, the increase in bankruptcies in Brussels is twice as high as the national rate.
What worries the magistrate even more is that larger Brussels companies are also being affected. In addition to the widely publicised case of Lunch Garden, there’s Sicli, a fire extinguisher company based in Uccle. Placed under temporary administration at the end of 2024, the company was ultimately saved, but at the cost of laying off two-thirds of its staff. Then there are the serious difficulties facing Gérald Hibert's real estate group, which owns an impressive portfolio of premium commercial spaces in the capital. As revealed by our colleagues at L'Echo, its financial fragility has raised concerns about the entire commercial real estate sector...
Mediation, accounting obligations and skills
Paul Dhaeyer and Pierre-Yves de Harven, a judge on the commercial tribunal, put forward a number of proposals in response to the findings of the Brussels parliament's economic affairs committee a few weeks ago. The first is to refinance the debt mediation scheme for companies in difficulty. ‘It has helped to save around a hundred companies’, insists Harven. Another proposal is the possibility of using pro-deo accountancy support, as accountancy professionals play a key role in supporting and rescuing companies in difficulty.
The duo also suggest the reintroduction of an accountancy training programme. Here again, Paul Dhaeyer has his own point of view. ‘You can be an excellent entrepreneur but a poor manager. Proving your management skills is no longer compulsory in Flanders and Brussels but in Wallonia it is, and I think they're right. You have to be honest. A notary is not competent to judge the quality of the financial plan imposed on the founder of an LLP. We don't necessarily have to go back to an obligation, but training should at least be available.
The duo also suggest that new companies should be convened after 3 years to take a look at their situation, or that the threshold above which the balance sheet of an SME should be approved by an auditor should be lowered. He tested the idea with the FEB, which he says is not fundamentally opposed. ‘Faced with crises, it's really important that the accounts filed correspond to the economic and financial reality of the company. It wouldn't cost much, but it would make it easier to anticipate potential problems and, ultimately, save time and money’, he insists.
So many possibilities that it will be up to politicians to grasp... once Brussels has its government.
Saving businesses... and lives
Beyond the economic emergency, there is also the human challenge. Because behind the businesses that are collapsing, there are just as many entrepreneurs in distress. ‘Our consular judges have become veritable sentinels who receive them with humanity to guide them. In this way, the court plays the role of a control tower, but also an anchor point where people can come to seek help’, explains Paul Dhaeyer, who also praises the work of Beci, the Pulse Foundation, and the psychological support system un pass dans l'impasse. ‘Sometimes it's people on the verge of suicide that we're helping. We're not just saving companies, we're saving lives’, the magistrate told the Brussels economic committee.
Beci’s CEd Relance: solving problems but also anticipating them
‘Going out of business should no longer be seen as a failure, but as the result, at a given moment, of particularly difficult circumstances. Yet bankruptcy and financial difficulties are still seen as taboo subjects - and we want to break that taboo,’ explains Lisa Isnard, Beci's General Secretary, to the same committee. Founded over 20 years ago, Beci's CEd Relance is open to all entrepreneurs.
The centre is not just for companies in serious difficulty. For the past two years, its workshops have offered legal, legal, financial and management solutions designed to anticipate delicate situations, such as a necessary digital transformation, a fear of damaging economic stagnation or a business transfer.
Anonymity can be guaranteed on request. Simply contact the CEd on 02.533.40.90 or ced@beci.be. Depending on your questions and preferences, you will be directed to a weekly group or individual workshop, where experts will listen, guide and, above all, provide very practical solutions to each situation. It's also important to remember that bankruptcy is not the only possible outcome in the event of serious, proven difficulties.
Prevention, recovery or judicial reorganisation
In addition to these workshops, CEd Relance has set up a series of ‘Prevention/Recovery’ training courses to support entrepreneurs, strengthen their skills and facilitate their recovery through concrete examples and directly applicable advice. This cycle also includes support groups that provide a place for people in distress to talk and listen sympathetically. More information is available here.
In addition to these workshops, CEd Relance has set up a series of ‘Prevention/Recovery’ training courses to support entrepreneurs, strengthen their skills and facilitate their recovery through concrete examples and directly applicable advice. This cycle also includes support groups that provide a place for people in distress to talk and listen sympathetically. More information is available here.
In 2024, the CEd handled more than 900 cases. It also manages a support scheme set up by the Brussels Region in 2021 to cover 75% of the costs of preparing a Judicial Reorganisation Procedure (JRP). The procedure offers a reprieve to the company. It involves a referral to the commercial tribunal, which decrees a period during which a company cannot be declared bankrupt and can put in place a plan to be proposed to its creditors. Past debts are automatically frozen. The JRP requires a preliminary financial diagnosis based on a balance sheet less than 3 months old and a previous closed balance sheet. It often allows companies to pull through. The rescue rate is 30%.