Tax on discount at purchase.
Favorable tax treatment may be available if employees undertake not to sell shares for two years from acquisition (likely also necessary to impose a block on the sale of the shares during such period).
A stock-exchange tax applies to the sale of shares and may apply to the purchase of shares, depending on the circumstances.
May be allowed if subsidiary reimburses parent; however, will likely trigger social insurance contribution requirement (if not already applicable - see next section).
A substantial risk exists that reimbursement would be considered a capital loss on shares, which is not deductible.
Income Tax
Yes.
Social Insurance Contribution
Uncertain due to evolving case law, but social insurance contributions may be due by both the employee and the employer, depending on whether the subsidiary reimburses the parent, whether the cost of awards is otherwise considered borne by the subsidiary, or whether the awards can be considered as compensation for employment performed in furtherance of an employment agreement. Both employee and employer contributions are uncapped (but employee contributions deductible for income tax purposes). If applicable, employer has to withhold employee's contributions.
Please contact Baker McKenzie for details.
The EU Prospectus Regulation is in effect in all European Economic Area countries, which includes all EU member states, Iceland, Liechtenstein and Norway ("EEA"). ESPP purchase rights are considered a public offering of securities for purposes of the EU Prospectus Regulation.
An EU-compliant prospectus will be required for the offer of an ESPP in any EEA member state, unless an exemption or exclusion applies. A "small offering exemption" is available if the offer is made to less than 150 persons in a member state.
An "employee share scheme exemption" is available if the offer is made to existing or former employees (or directors), provided the offerees are provided with a short disclosure document that contains certain prescribed information about the offer. An exclusion for offers under a certain value threshold across the EEA may also be available.
Additional requirements may apply if relying on certain exemptions/exclusions or if a prospectus must be filed.
Contact Baker McKenzie for more information.
*Accumulated payroll deductions should be held by a financial institution in an account in the name of the participants with the funds attributable to each employee.
Generally, no, if employees sign certain disclaimer language.
Discrimination against union or part-time employees is prohibited.
The EU Council Directive 2000/78/EC prohibits age discrimination. Belgium has adopted local rules implementing this Directive, which may have an impact on design of equity and other incentive plans in the EU, particularly on age or age and service provisions which give different treatment for those meeting the criteria.
A valid basis is required to collect, process and transfer personal data.
The EU Data Protection Regulation ("GDPR") became effective in all EU/EEA countries on 25 May 2018. It introduces new requirements and increases the powers of data protection authorities, rights of data subjects and potential penalties for non-compliance. Accordingly, companies should review their approach to data privacy compliance in the context of equity plan administration and consider on which basis they may be able to rely to collect, process and transfer data.
Registration and notification requirements with local data privacy authorities may also apply.