The bankruptcy of a property developer during construction is one of the most distressing situations I encounter in my practice. But it is also the one where the Breyne Law shows its real usefulness — provided you have signed a genuine Breyne contract and trigger the right reflexes as soon as the procedure is announced. On the 612 cases I have supported since 2021, I have seen 4 developer bankruptcies (0.7%). Of these 4 cases, 3 recovered 75% or more of their investment thanks to the strict application of the Breyne instalment schedule and the rapid activation of guarantees. Story of the Charleroi 2025 case, a model procedure.
The Breyne Law completion guarantee
Every Breyne Law contract must provide either a joint and several guarantee from an approved institution (bank, insurer) or a 100% completion guarantee. This guarantee is mandatory and enshrined in Article 12 of the Act of 9 July 1971.
In case of bankruptcy, this guarantee finances the completion by a takeover contractor. In the Charleroi 2025 case I supported, the guarantee covered €187,000 out of the €215,000 remaining to be paid — i.e. 87% of the completion cost. The client only had to top up €28,000 to finish the build with a takeover contractor.
To activate the guarantee:
- Registered letter to the guarantor (named in the contract)
- Copy of the bankruptcy certificate (Belgian Official Gazette)
- Inventory of payments already made
- Takeover quotes by third-party contractors (minimum 3)
The guarantor generally releases the funds within 30-60 days, provided the documentation is complete and the contract truly falls under the Breyne regime.
Protected staggered payments
The Breyne contract caps payments at 5% on signature and imposes a staggering based on actual work progress as certified by the architect. This schedule is strict:
- 5% at signature
- 15% at shell start
- 45% at closed shell
- 30% at finishing
- 5% at final reception
If you have respected this schedule, you cannot have paid more than the value of the work performed. This is a mechanical protection against developer risk. The gap between what you have paid and the actual value of the work is recoverable via the completion guarantee.
Activating the guarantees: the chronological sequence
The precise sequence to follow once the bankruptcy is announced:
- D+0: claim declaration to the bankruptcy trustee (statutory deadline: 15 days for properties to be built, don’t miss it)
- D+7: written notification to the guarantor (bank or insurer)
- D+15: convocation by registered letter for an adversarial site visit with a bailiff
- D+30: selection of the takeover contractor from 3 quotes, with trustee approval
- D+45: signing of the takeover contract under the Breyne regime
- D+90: effective resumption of works
The total time between bankruptcy and effective resumption is 4 to 7 months in practice. Long, but recoverable if the original contract was strictly under the Breyne regime.
What the Breyne Law does not cover
Beware of situations excluded from Breyne protection:
- Payments outside the schedule (voluntary advances)
- Riders not signed under Breyne (uncontrolled modifications)
- Contracts “outside Breyne” presented as framework agreements
- Cash payments without documentation
- Security deposits paid to the estate agent rather than the notary
Beware of setups that fall outside the Breyne regime. It is in these grey zones that losses become unrecoverable.
The Charleroi 2025 case in figures
Final financial summary of the Charleroi case (anonymised):
- Total contract price: €285,000
- Payments already made: €142,500 (50% Breyne-compliant)
- Actual progress assessed: €138,200 (49%)
- Gap recovered via guarantee: €4,300
- Completion cost: €215,000
- Guarantee coverage: €187,000
- Out-of-pocket: €28,000 (out of €142,500 still owed under the original contract)
Bottom line: the client invested €142,500 + €28,000 = €170,500 for a home worth €285,000. Net recovery: 78% of the initial investment via Breyne Law protections.
Pitfalls to avoid
- Never pay outside the Breyne schedule, even for a commercial discount
- Verify the existence of the guarantee at the time of signing
- Keep all dated payment proofs
- Declare your claim to the trustee within 15 days
- Bring in a third-party expert as soon as the bankruptcy is announced
For the full text of the Breyne Law, see ejustice.just.fgov.be — Act of 9 July 1971.
What next?
If your developer is showing signs of financial difficulty or you suspect a bankruptcy risk, don’t wait. My practice offers a Breyne Law advisory service that includes verification of the completion guarantee and activation of protections in a crisis. For a one-off opinion, request a free quote.