Employee Share Plans in Europe and the USA - Sorainen

Employee Share Plans in Europe and the USABelgium6. Taxation of share disposalsNo tax charge normally arises on the disposal of shares where the shares aresold by an employee. 97. Data protectionThere should be no data protection issues if the participant has given hisconsent to the collection, processing and worldwide transfer of his personal datain connection with each employee share plan in which he participates. 10 It isuseful to specifically collect the employee's data which will be used for the planand to obtain employee consent for the processing of their personal data,particularly since the validity of employee consent for the processing of nonsensitivedata by the employer is not generally questioned in Belgium (asopposed to the situation in certain other European countries). 11 The BelgianData Protection Commission must be notified of the data processing and of thedata transfers to be carried out in connection with an employee share plan.8. Employment lawPlease refer to paragraph 4 on pages 5-6 of this guide. This explains theemployment law issues which are generally applicable to a greater or lesserdegree in all the countries covered by this guide. There is a risk that employeesmay claim a right to continued participation in an employee share plan or thatrights under a plan may be included in compensation on termination.91011This assumes the shares are sold in the normal course of the management of the employee's privateassets.Where employee share plans are set up at group level (with various subsidiaries taking part in thesame plan), the first step is to determine the identity of the data controller. This will usually be thegroup entity setting up the plan, but could also be the local employer. Thereafter, exchanges ofpersonal data within the group need to be considered carefully and will require, amongst other things,appropriate guarantees to safeguard this data.If this consent is included in the general terms and conditions of the plan, it can, however, arguably beheld to be invalid (since not freely given) if it extends to data or processing which are not strictlynecessary for the share plan. It is therefore prudent to limit the data collected and the processingthereof to what is necessary for the performance of the plan or to that what is justifiable on the basis ofthe so-called "balance of interest" test. If data is collected or processed which does not meet this test,we recommend obtaining a freely obtained consent. This can be done by giving the employees theoption to opt-in to this particular type of processing, rather than by obtaining this consent in the generalterms and conditions. Even if such freely obtained consent is obtained, the data controller is stillrequired to comply with the key principles of data protection regulations, i.e. the data should only becollected for specific, explicit and legitimate purposes and should be adequate, relevant and notexcessive in relation to the purposes for which it is collected and/or further processed.UK/1729295/03 19 September 2010