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Do not forget the judgment registration fee

07/04/2021
Do not forget the judgment registration fee

The tax levied at the moment of the mandatory registration of court judgments is often forgotten when considering litigation and enforcement strategies in Belgium.

What is the registration fee?

The registration fee (“Registratierecht”/“Droit d’enregistrement”) is a tax that the Belgian tax authority levies on a judgment ordering the payment or liquidation of sums or movable assets. The tax equals 3% of the amount to which a party has been held liable (including costs).

This is considered to be the litigant’s contribution to the costs of the judiciary’s services.

When is it due?

The fee is due at the moment of the registration of the relevant judgment by the court registrar. The registrar is bound to register judgments.

There are a few exceptions. Interlocutory injunctions (issued by a judge sitting in summary proceedings) do not trigger the tax. Nor do judgments in which the aggregate amount of the order  against the same person does not exceed EUR 12,500. 

The registration fee is also due on exequatur judgments when proceeding to the enforcement in Belgium of arbitral awards and foreign judgments.

Who owes it?

The judgment debtor is also the debtor of the tax. In the event of multiple judgment debtors, each of them will be liable for the tax to the extent that the payment order in the judgment has been ordered against them. Joint and several liability in the judgment leads to joint and several liability for the tax.

To ensure recovery of the tax, the State enjoys a privilege on the sums that are the object of the order.

Strategy

The tax may have a significant (unexpected) financial impact on the parties’ situation. For example:

  • The losing party in court proceedings will not only owe the amount of the court order and the costs, but also the registration fee;
  • The tax is also due on exequatur judgments of arbitral awards and foreign judgments. Hence the Belgian tax authority becomes a (competing) privileged creditor in enforcement proceedings.
  • The tax remains due even if the parties settle after a judgment has been made.

Therefore, it is wise to take this registration fee into account when considering litigation and enforcement strategies in Belgium.

 

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