The answer is yes. According to Article 5 of the Insolvency Act 22/2002 of 9 July, the debtor must request the declaration of insolvency within two months of the date …
Small and medium-sized enterprises (SMEs) are well known for playing a major role in all economies, being the key generators of employment and income. As a result, SMEs are crucial …
The Law introduces positive changes to financing agreements and restructuring but fails to address critical issues. Inadequate resources for the Justice system and the absence of solutions for individual debt problems persist. Additionally, the underutilization of the restructuring procedure contributes to low satisfaction among ordinary creditors.
In Spain, creditors’ compulsory liquidation proceedings differ from creditors’ voluntary liquidation, as they are initiated by a legitimate creditor following Article 3.1 of the Law 22/2003 (the Insolvency Act).
This article contains a summary of the principal measures introduced by the Procedural Streamlining Measures Bill in Spain, which is intended to improve, streamline and speed up current procedures in the spanish Civil and Contentious Administrative Systems in Spain.
The current Spanish Insolvency Law raises directors’ liability levels. Hence, directors must not only manage the company but also address legal aspects to prevent liability in insolvency proceedings.
The Council of Ministers has endorsed a draft amending Spain’s insolvency proceedings law, previously modified by Royal Decree 3/2009. The amendments, introduced to expedite and reduce costs, aim to position insolvency proceedings as a tool not only for winding up but also for attempting to save the company.
The strict reading of Article 97.2 may harm a creditor with a debtor-specific guarantee, as it implies automatic extinguishment without additional criteria. Unfortunately, the current wording doesn’t support a discretionary judge interpretation, posing a risk of guarantee extinguishment without due consideration.
The recent Spanish Bankruptcy Law expands the examination of company managers’ liability, supplementing existing provisions in the Public Limited Company and Limited Liability Company Laws, as well as the Criminal Code, within the context of corporate crime. It introduces a classification section in bankruptcy proceedings where the judge assesses the involvement of company managers in the company’s bankruptcy situation.
The Spanish legal system offers creditor protections for companies that cease commercial operations but remain inactive, failing to undergo the necessary dissolution and liquidation processes. Typically insolvent, these companies neglect corporate debts and obligations by discontinuing trading, abandoning the business premises, not filing annual accounts with the Commercial Registry, neglecting tax payments, and failing to fulfill other corporate obligations mandated by law.
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