The New Liquidities in Insolvency Proceedings in Spain

Currently, only 50% of the new liquidities invested in refinancing have an insolvency privilege, which implies that the credits must be paid according to their due date.  This percentage reaches 100% temporarily to give this liquidity the best protection.  The goal is to stimulate additional financing, which is necessary to guarantee the temporary viability of the company and to make the refinancing agreement practicable.  This consideration extends to payments the debtor or persons particularly related to the debtor made except for capital increases.

This measure was adopted extraordinarily and temporarily for the payments of new liquidities that have occurred within two years after the effective date of the Real Decree-Law 4/2014 (since March 9, 2014).

For additional information regarding liquidities in insolvency proceedings in Spain,

Please note that this article is not intended to provide legal advice.

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