The Royal Decree of 10 August 2009 has introduced new reporting obligations for intercompany transactions regarding non-arm’s length transactions and off-balance sheet arrangements.
Corporations are required to report non-arm’s length transactions with related parties in their annual accounts but this principle only applies to “material” transactions. However, the decree does not specify what constitutes the “material” character of a transaction. Regarding the term "related party", the definitions contained in IAS 24 apply.
The type of transactions to be reported depends on the nature of the company. An extensive reporting obligation applies to the following corporations: corporations listed on a stock exchange;  corporations whose shares are traded on a Multilateral Trading Facility;  corporations that meet more than one of the criteria in order to be considered a large group under the Belgian Companies Code.
While these corporations in principle must report all non-arm’s length transactions with related parties, the Royal Decree provides an exemption for transactions between group members when the subsidiaries involved are wholly owned by a member of that group.
For qualifying transactions the amounts involved in the transactions, the nature of the relationship with the related parties, and all other information needed to ensure an accurate view of the financial position of the corporation must be reported.
Corporations that do not meet any of the above criteria only have to report direct and indirect transactions between the company and its major shareholders and between the company and its leadership.
Corporations also have to report the nature and business purpose of off-balance sheet arrangements in the annexes to the financial accounts, if these arrangements are material and the related risks and benefits can influence the assessment of their financial position.
In addition, listed corporations, corporations whose shares are traded on a Multilateral Trading Facility and corporations that meet more than one of the criteria in order to be considered a large group under the Companies Code must quantify the financial impact of the off-balance sheet arrangements on their financial position. Both reporting obligations apply to accounting periods starting as from 1 September 2008.