Complex Governance Reduces Belgium’s Market Watchdog to a Wagging Puppy

“Together, we can make our societies open for business but closed for crime.” The words of Belgian Prime Minister Bart De Wever at the United Nations still resonate as I work my way through the 146-page decision of the FSMA Sanctions Committee on market manipulation at Nyrstar NV.

The Committee’s mandate was clear: to determine the sanctions for four violations identified by the FSMA’s auditor after years of investigation. His exhaustive reports left little doubt that Nyrstar’s reference shareholder, Trafigura, had failed to act in support of the company, had benefited from covert profit extractions, and that Nyrstar’s true solvency and liquidity positions were concealed from the market.

Market Manipulation Without a Manipulator

The FSMA’s auditor concluded that Nyrstar and its directors had engaged in market manipulation and proposed sanctions for all defendants. The findings were so serious that the case was also referred to the public prosecutor’s office, where the investigation is still ongoing.

Yet in the Sanctions Committee’s final ruling, little remained of the auditor’s conclusions or proposed penalties. Nyrstar was found guilty of market manipulation—but only for misleading communication about liquidity and delayed disclosure of inside information. All directors were cleared because, after four (!) years, there had supposedly been insufficient investigation into their individual roles. And Trafigura, the reference shareholder, wasn’t even prosecuted because the FSMA claimed it lacked jurisdiction. It, too, walks free.

The Sanctions Committee ruling concerns only whether one press release on one particular date was transparent. The Committee concluded that the market had been manipulated that day—meaning false and misleading information was deliberately spread. The facts established by the auditor were not disputed. Yet the final sanctions and reasoning hardly send a strong deterrent message.

One must wonder how this outcome affects the morale of the FSMA’s audit team. Why devote years to detailed, in-depth investigations if a handful of magistrates can dismiss their painstaking work in favor of a one-sided narrative crafted by defense lawyers?

Although the core restructuring of Nyrstar is to be dealt with in a separate proceeding, the Sanction Committee’s decision to let all individuals walk free in this administrative case hardly strengthens the Prime Minister’s UN declaration—nor does it reassure investors.

FSMA Muzzled by a Legion of Lawyers…

A staggering 80 of the Sanction Commission’s 146 pages ruling are spent on the defense’s procedural objections. One might think it was the FSMA auditor, not Nyrstar and its board, in the dock. The regulator found itself on the defensive against an army of high-priced litigators representing the seven accused parties.

…While Lacking the Teeth to Bite

Nyrstar was fined €80,000—a pittance compared to the estimated €2 billion in damages. Worse still, the fine must be paid by the hollow shell of Nyrstar NV, meaning the victims, the minority shareholders, effectively pay it themselves.

Trafigura—a company repeatedly accused and convicted of corruption and fraudulent practices around the world—emerges unscathed, as do all the other defendants. Such a ruling does nothing to impress a multinational earning billions annually. On the contrary, it serves as an open invitation to others with deep pockets and dubious ethics to follow suit.

Uneven Playing Field, Democratic Deficit

Most of the (rejected) procedural objections revolved around baseless insinuations that there had been improper information-sharing between the FSMA and the minority shareholders—quod non.

The defrauded shareholders were excluded entirely: they could not access the arguments of the defendants, share their own, or even attend the hearings. The accused, by contrast, were given two years to build a narrative, exclude key evidence on procedural grounds, and argue their case for five full days—behind closed doors, without the right of reply for those harmed.

Where is the level playing field? Where is the right to a fair trial? Has the pendulum swung so far in favor of “defense rights” that justice for victims has disappeared entirely?

If this is how Belgium’s most significant minority shareholder protection case in decades is handled, it sheds light on why solid, evidence-rich cases fizzle out, and why bona fide investors are abandoning the Brussels market—draining its liquidity further with each departure.

Complex Governance Turns Watchdog Into Lapdog

At a 2022 Federation of Belgian Enterprises (VBO/FEB) seminar, the FSMA’s vice-chair confidently claimed minority shareholders had a “complete toolbox” to defend their rights. When asked whether that toolbox was actually effective, the answer was vague and evasive.

After more than six years of relentless effort by our group of defrauded minority shareholders, we can answer unequivocally: the toolbox is neither effective nor efficient. It is a smokescreen—designed to conceal market manipulation and abuses of power by controlling shareholders and boards, or at least to shield perpetrators from real consequences.

The masks have fallen. The stock market watchdog has become a wagging puppy, obediently following powerful interests armed with deep pockets and armies of lawyers. Internal bureaucratic structures and endless procedural loopholes have declawed and defanged it.

The FSMA’s Sanctions Committee has become the perfect instrument to ensure the watchdog stays toothless—while investors, whose confidence was already shaken by scandals like Nyrstar and others, cry out for more decisive, interventionist oversight.

Who’s Lobbying for Whom?

Who, exactly, lobbies for the labyrinth of procedural barriers that paralyze enforcement? Who benefits from a governance framework where “good governance” has no enforceable meaning and violations carry no real consequences?

After six years of struggle, we have proven that Belgium’s market watchdog—and, more broadly, its rule of law—suffers from structural failure. Investor confidence has been deeply eroded, and the gates have been thrown open to white-collar crime. The precedent is enormous; the impact on our collective prosperity, profound.

Time for the Dentist: The Toothless Watchdog Needs New Teeth

If the Prime Minister is serious about his UN statement, he and his Finance Minister must finally act—through legislative reform—to expand the FSMA’s mandate and restore its effectiveness.

The Nyrstar case shows just how urgent this is. Three key questions demand answers:

1. Should the FSMA’s mandate be broadened beyond narrow transparency oversight, to include enforcement and sanctioning powers for breaches of good governance and financial law?

2. Should current procedures be overhauled in cases of serious, organized fraud to make the FSMA more agile and proactive—by tightening deadlines, granting victims a voice, reversing burdens of proof, and allowing direct summonses?

3. Should FSMA governance itself be rebalanced to restore equilibrium between economic reality and legal formalism—recognizing that the current obsession with proceduralism helps no one and punishes only honest players?

Only then will white-collar criminals truly be deterred. And that is no luxury, as international actors with dubious motives increasingly embed themselves in our economic fabric.

As the Flemish anthem reminds us: a lion without teeth or claws cannot defend itself. Our rule of law is no different—it needs both teeth for enforcement and claws for sanctioning.

Lord Chief Justice Gordon Hewart once said: “Justice should not only be done, but should manifestly and undoubtedly be seen to be done.” Impartially. In the open. Not through backroom deals and procedural gamesmanship.

Dear Bart, dear Jan — the integrity of our capital market and our economic prosperity are on the line. Our mission to expose the problem, put it on the map, and propose solutions is complete. Now, the responsibility is yours.

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Kris Vansanten

Belgian entrepreneur, Managing Partner of Quanteus Group

Founder of the Nyrstar Collective – representing Nyrstar NV minority shareholders