Articles 61 and following of Law 22/2003 provide for the effects of the termination of contracts in the context of bankruptcy proceedings in Spain. The law grants different mechanisms to the parties to guarantee the survival of the bankrupt company and the right of debt recovery of its creditors.
Author Archive for: Insolvency Law
About Insolvency Law
Mariscal & Abogados specialises in providing legal counsel and assistance to both creditors and debtors on insolvency and bankruptcy proceedings in Spain. If you have a query, do not hesitate to Contact us.
Entries by Insolvency Law
Royal Decree-Law 8/2020 introduces changes to the deadlines for applying for bankruptcy proceedings in Spain, whether voluntary or necessary. It also empowers the judges to reject applications, up to two months after the end of the state of alarm.
When partners of a subsidiary in Spain decide its closing due to economic reasons, the question arises as to how to do it. Depending on each specific case, the company may be dissolved and liquidated with or without bankruptcy proceedings.
Unsuccessful enforcement by the creditor implies the existence of a title by which enforcement has been effected, without sequestration resulting in sufficient unencumbered assets for the payment of the outstanding credit.
The purpose of this article is to provide an answer to the legal uncertainty that many foreign businessmen have when establishing commercial relations with Spanish companies, as well as the lack of knowledge of current bankruptcy legislation.
The Entrepeneurs Act aims to find a different solution for debt collection procedures by facilitating a second opportunity to self-employed workers affected by the debt collection procedure.
The Royal Decree-Act 4/2014 is focusing on the refinancing agreements which may include waivers and capitalisation of debt and deferral payments. These agreements will essentially make the heavy burden of debt much more manageable for businesses.
A new regime is being introduced in order to give some unapproved refinancing agreements judicial validity. The new regime will enter into force before the effective date of the Real Decree Law; however, the previous regime will still apply unless the parties choose otherwise.
The dissolution of a company in Spain as a result of losses, in particular in times of an economic crisis, requires certain procedures to be followed. The Corporate Enterprises Act (LSC) highlights different methods of dissolving a company depending on what type of company it is.
The mechanism for legal ratifcation of the refinancing agreement was reviewed under the Real Decree-Law. One of its amendments included extending the effects to non-participating creditors (without collateral) and clarifying its scope via vis-Ã -vis creditors (with collateral). This mechanism is making the conversion of credits into equity loans much more efficient in Spain.