Insolvency or bankruptcy, take place when a company fail to pay their debts. Insolvency declaration leads to a bankruptcy proceeding. Corporate restructuring takes place when a company encounters a difficult situation and management decides to change the outer and inner structure and direction of the company.

pre-insolvency proceedings

Objectives and advantages of pre-insolvency proceedings in Spain

The crisis may drive companies into insolvency. In these cases, the management body must adopt the fairest solution for all creditors, with the purpose to resolve the critical situation of the company. Pre-insolvency may be an alternative.

Pprocedural measures in Spain, the Law 3/2020

Procedural measures in Spain, the Law 3/2020

This informative note deals with the procedural and organizational measures to deal with COVID-19 in the field of the Administration of Justice in Spain, as included in Law 3/2020, of 18 September. We analyze its chapters and summarize their most relevant points.

The new Insolvency Law – RDL 12020 – RDL 1-2020

Informative Note: The new Insolvency Law (RDL 1/2020)

In the following informative note, we address the Royal Legislative Decree 1/2020, of 5 May, that approves the redrafted text of the Insolvency Law, and revises its structure and key characteristics.

How to determine the insolvency status of the company

How to determine the insolvency status of the company in the insolvency proceedings

The state of insolvency obliges companies to apply for the insolvency proceedings. We analyse some facts that can help to identify this status, as well as the most commonly used accounting formulas to predict it: the acid test and the Altman Z-score.

How to apply for bankruptcy in Spain

How to apply for bankruptcy in Spain: Basic aspects and Deadlines

The Bankruptcy Law in Spain regulates the basic aspects and the deadlines within which companies should apply for bankruptcy when their situation does not allow them to fulfil their payment obligations on a regular basis.

Liability for transfer of undertaking

Liability for transfer of undertaking in insolvency proceedings

We analyze the numerous judgements of the High Court regarding the existence or not of transfer of undertaking when a company acquires a productive unit of another company in the liquidation phase of the insolvency proceedings.

Express insolvency proceedings in Spain

Express Insolvency Proceedings: an alternative for companies without assets

In Spain, the Insolvency Law provides for the processing of express insolvency proceedings for those companies with no assets nor properties (or that are of a residual nature), with the corresponding savings in time and costs that ordinary insolvency proceedings would normally entail.

Insolvency proceeding or company liquidation?

Insolvency Proceeding versus Company Liquidation

In times of crisis, companies may find themselves in a legal cause for dissolution. In this article, we analyse when they should initiate a bankruptcy proceeding and when they should opt for the dissolution and liquidation of the company.

Negligent bankruptcy and the liability of the parent company

Negligent Bankruptcy in Spain and the Liability of the Parent Company

During the insolvency proceeding, the so-called ‘Sixth Section’, if opened, will determine whether or not the bankruptcy is negligent, as well as the liability of the company directors. We analyse if it is possible to attribute this liability to the parent company.

The termination of contracts with reciprocal obligations

The termination of contracts with reciprocal obligations in bankruptcy proceedings

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.