The reform of the insolvency legislation in Spain
As in other jurisdictions, Spain's new Insolvency Act (16/2022), which transposed EU Directive 2019/1023 on preventive restructuring frameworks, contains rules that seek to favour the sale of the assets of an insolvent company as a business unit. The aim is to increase the value obtained from the sale: the value of a set of assets, workers or contracts, among others, that are in operation and are productive will be higher than the value of each of these assets separately.
Although such joint sales had been included in the law since 2003, numerous amendments have been made to complete the initial regulation and encourage these sales (although some reforms have had the opposite effect, as explained below). As a result of the recent reform of the insolvency legislation, new rules were introduced to accelerate the sale process of these business units through:
- an accelerated insolvency process if the acquisition offer is submitted together with the insolvency petition; and
- the appointment of an expert to help the company in difficulties to obtain offers for the acquisition of the business unit prior to the formal insolvency process.
See complete chapter at: Investing in Distressed Debt in Europe. The TMA Handbook for Practitioners, Second Edition. Globe Law and Business, 2023.