l8 BELGIUM - CO-OPERATION AND ASSOCIATION 



ised and realisable credits, the society's debt towards itself, its engagements, 

 its mortgage debts and debts not secured on real estate. 



The amendments for a further development of the balance sheet, by 

 the introduction of details meant to give a precise idea of the various items 

 forming the credits, were rejected. And those which aimed at obliging the 

 societies to publish the list of their bills and acceptances suffered the same 

 fate. Publicity of this kind might in fact have led to inconveniences. 

 Nevertheless, the law attempts, by other clauses which the space left to 

 us does not permit of our reproducing, to provide so that the shareholder 

 may inform himself as to the most important of these bills and accept- 

 ances. 



7. Issue of Bonds. — The innovations introduced by the new Belgian 

 law on commercial societies in respect to bonds must be counted among the 

 most important and the most successful. These bonds are generally issued 

 by limited liability societies after their definite constitution and have the 

 character of real liabilities guaranteed by the share capital. The law has 

 shown on this occasion special sollicitude for the interests of the bond 

 holders, hitherto somewhat neglected. 



In fact, to protect them from disagreeable surprises and provide them 

 with the means of effectively defending themselves, a series of provisions 

 has been introduced, inspired by the following four classes of ideas ; (i) 

 wide publicity given to the; issue and sale of the bonds; (2) special indications 

 to be given on the bonds ; (3) issue of bonds on mortgage ; (4) organisation 

 of the general meeting of bondholders. 



Art. 68 indeed prescribes a system of publicity for the issue and sale 

 of bonds similar to that we have mentioned for shares. 



The provisions with regard to mortgage bonds are specially interesting. 



Ivet us say, in the first place, that, according to Belgian law, mortgages 

 can onl^"- be passed in favour of a definite individual, a person, physical 

 or legal. Consequently, the holders of bonds, that is to say of credit secur- 

 ities not naming the holder, were up to the present without this precious 

 guarantee. The new law, by a wise provision, based on foreign laws, has 

 extended the advantages of the mortgage bond to the bonds of the com- 

 mercial societies. 



It, in fact, establishes that a society may mortgage real estate to guar- 

 antee loans it contracts under form of issue of bonds. Registration is made 

 in favour of the whole group of bondholders, the name of the creditor being 

 substituted by that of the securities representing the credit guaranteed . The 

 mortgage takes the place due to it by date of entry, without the date of the 

 issue of the bonds being considered. The entry must be renewed bj' the 

 managers on their responsibility before the expiration of the fourteenth 

 year. If the renewal is not made by the member, any bondholder has the 

 right to make it. 



But perhaps the best guarantee the new law offers the bondholders 

 is the power it grants them of assembling for the defence of their common 

 interests and discussion with the society in general meeting where they are 



