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.
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.
Royal Decree-Law 8/2020 amends certain obligations of company directors when there is a legal or statutory cause for dissolution or if the company finds itself in a state of insolvency.
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.
Three partial reforms of the Spanish Insolvency Law have already been approved by means of Royal Decree-Laws dated on March 2014, September 2014 and February 2015. The three main purposes sought are: enhancement of prepetition restructuring deals; extension of pre-insolvency refinancing agreements to composition agreements and offer a second chance for individual creditors.
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.
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