“When concluding an agreement, the non-disclosure by a party can, under certain circumstances, constitute fraud when it concerns a fact that, if known by the other party, would have led such other party either not to contract or to contract under less burdensome conditions.”

In this remarkable and since-criticized judgement of 11 March 2019, the 𝐂𝐨𝐮𝐫𝐭 𝐨𝐟 𝐂𝐚𝐬𝐬𝐚𝐭𝐢𝐨𝐧 confirmed that a share purchase agreement can be annulled on the grounds of fraud when the seller withholds information which he knew or should have known to be essential to the buyer. Noteworthy, the Court did not address the buyer’s own investigation obligation, even though the buyer could have verified the information in question himself through public sources.

👉 Want to learn more about this judgement and other key Belgian M&A cases from 𝐭𝐡𝐞 𝐩𝐚𝐬𝐭 𝟐𝟓 𝐲𝐞𝐚𝐫𝐬? You can find them all here, together with our related annotations.

📊By the way, did you know that 𝐭𝐡𝐞 𝟓𝐭𝐡 𝐞𝐝𝐢𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐌&𝐀 𝐒𝐮𝐫𝐯𝐞𝐲 shows that in 52% of the examined transactions, public information was considered a disclosure, which constitutes an exception to the representations and warranties? We will be organizing a 𝟔𝐭𝐡 𝐞𝐝𝐢𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐌&𝐀 𝐒𝐮𝐫𝐯𝐞𝐲 this year. Leave your contact details on this form to participate and help us find out whether this trend has continued.

Follow along with our corporate and M&A team as we highlight more interesting case law in the coming weeks!

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