Insolvency proceedings that do not involve assets, previously known as express proceedings, are a simpler and faster way for insolvent companies to go through the process compared to regular insolvency proceedings. This procedure allows for the closure and dissolution of companies with no assets or whose value is insufficient to cover the costs of the proceedings. Articles 37 bis and following the reform of the Insolvency Code (Law 16/2022 of 5 September on the reform of the Insolvency Code) regulate this type of insolvency procedure.
Requirements for insolvency proceedings without assets
Insolvency proceedings will be considered without assets when :
- The insolvent party has no legally attachable assets and rights
- The costs of realising the assets and rights are manifestly disproportionate to their probable market value
- The unencumbered assets and rights of the insolvent party are worth less than the probable costs of the proceedings
- The burdens and fees on the assets and rights of the insolvent party exceed the market value of those assets and rights.
The express insolvency proceedings allow the judge to declare the closure of the insolvency proceedings in the same order in which he opened the insolvency proceedings.
In insolvency proceedings without assets, the judge shall issue an order opening insolvency if the debtor is in one of the above situations. The signed order is announced in the Official State Gazette (B.O.E.) and in the Public Insolvency Register.
Within 15 days of publication, creditors representing at least 5% of the debtor’s liabilities may apply for the appointment of an insolvency administrator who shall prepare and submit a documented and reasoned report.
If the appointment is approved, the judge shall issue the corresponding order and fix the amount to be received by the administrator to prepare the report. The remuneration shall be at the expense of the insolvency administrator or administrators who have requested the appointment.
If no creditor applies for the appointment, the insolvent party or debtor may apply to the judge to dismiss the unsatisfied liabilities.
Documents required for the filing for insolvency proceedings without assets
- Explanatory report on the situation of the company
- Inventory of assets and rights
- List of creditors
- Annual financial statements for the last financial years
- Report on significant changes in equity
- Report on the actions taken following the presentation of the last financial statements.
Álvaro Gómez Fernández
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