{"id":52351,"date":"2025-08-25T21:04:38","date_gmt":"2025-08-25T19:04:38","guid":{"rendered":"https:\/\/entretramites.com\/en\/?p=52351"},"modified":"2025-08-25T21:04:40","modified_gmt":"2025-08-25T19:04:40","slug":"insolvency-proceedings-spain","status":"publish","type":"post","link":"https:\/\/entretramites.com\/en\/legal\/insolvency-proceedings-spain","title":{"rendered":"Insolvency Proceedings in Spain: What You Need to Know"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\"><strong>What Are Insolvency Proceedings in Spain?<\/strong><\/h2>\n\n\n\n<p><em>Insolvency proceedings<\/em> (<em>concurso de acreedores<\/em>) are judicial processes regulated by the <strong>Spanish Insolvency Law<\/strong> to manage situations where companies or individuals cannot meet their financial obligations.<\/p>\n\n\n\n<p>In 2025, insolvency remains a structured way to handle financial distress, offering two main solutions:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Debt restructuring<\/strong>: negotiate payment reductions, extensions, or new conditions with creditors.<br><\/li>\n\n\n\n<li><strong>Liquidation<\/strong>: sell assets to pay debts if continuation is not viable.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Types of Insolvency Proceedings<\/strong><\/h2>\n\n\n\n<p>In Spain, insolvency can take different forms:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Voluntary insolvency<\/strong>: initiated by the debtor facing current or imminent insolvency.<br><\/li>\n\n\n\n<li><strong>Necessary insolvency<\/strong>: requested by creditors when payments are not met (wages, taxes, etc.).<br><\/li>\n\n\n\n<li><strong>Express insolvency (without assets)<\/strong>: a fast-track process for micro-companies or individuals with minimal or no assets, where proceedings would cost more than the value of the estate.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>New Updates in 2025: Organic Law 1\/2025<\/strong><\/h2>\n\n\n\n<p>The <strong>Organic Law 1\/2025<\/strong>, effective since April 2025, brings major changes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Specialised commercial courts for insolvency cases.<br><\/li>\n\n\n\n<li>Digitalisation of insolvency procedures.<br><\/li>\n\n\n\n<li>New rules for express insolvency and appointment of administrators.<br><\/li>\n\n\n\n<li>Improved online auctions of assets.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<p>These updates aim to make insolvency more agile, transparent, and cost-efficient.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Stages of Insolvency Proceedings<\/strong><\/h2>\n\n\n\n<p>The process includes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Filing the request<\/strong>: at the Commercial Court, proving current or foreseeable insolvency.<br><\/li>\n\n\n\n<li><strong>Common stage<\/strong>: inventory of assets and liabilities, classification of creditors, appointment of an administrator (except in express proceedings).<br><\/li>\n\n\n\n<li><strong>Agreement or liquidation stage<\/strong>:<br>\n<ul class=\"wp-block-list\">\n<li><em>Agreement<\/em>: debtor and creditors negotiate reductions or payment plans.<br><\/li>\n\n\n\n<li><em>Liquidation<\/em>: assets are sold if no agreement is reached or the company is not viable.<br><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Express Insolvency in Spain<\/strong><\/h2>\n\n\n\n<p>Regulated under <strong>Article 37 bis TRLC (RDL 1\/2020)<\/strong> and updated by the <strong>2022 reform<\/strong> and <strong>Organic Law 1\/2025&nbsp; <\/strong>in Spanish<strong> <\/strong><a href=\"https:\/\/www.boe.es\/buscar\/act.php?lang=en&amp;id=BOE-A-2025-76&amp;tn=1&amp;p=\" rel=\"nofollow noopener\" target=\"_blank\"><strong>Ley Org\u00e1nica 1\/2025<\/strong><\/a>, express insolvency applies when:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The debtor has no attachable assets, or their value is less than the cost of proceedings.<br><\/li>\n\n\n\n<li>The judge declares the case \u201cexpress\u201d and publishes it in the <strong>BOE (Official State Gazette)<\/strong>.<br><\/li>\n\n\n\n<li>Creditors holding at least 5% of liabilities may appoint and fund an administrator within 15 days.<br><\/li>\n\n\n\n<li>For individuals, the case may open the way to the <a href=\"https:\/\/entretramites.com\/en\/legal\/second-chance-law-spain-cancel-debt\"><strong>Second Chance Law<\/strong> <\/a>(<em>Ley de Segunda Oportunidad<\/em>), allowing debt discharge under certain conditions.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Who Benefits from Insolvency Proceedings?<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Companies<\/strong> seeking restructuring instead of liquidation.<br><\/li>\n\n\n\n<li><strong>Individuals<\/strong> facing insolvency who want debt relief through the <em>Second Chance Law<\/em>.<br><\/li>\n\n\n\n<li><strong>Freelancers and SMEs<\/strong>, who can access the simplified or express procedure.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Deadline to File for Insolvency<\/strong><\/h2>\n\n\n\n<p>The debtor must request insolvency within <strong>two months<\/strong> of knowing or being expected to know about their insolvency situation. Failure to do so may lead to liability for worsening the financial situation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Why Understanding Insolvency Proceedings Matters<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Avoids fines and personal liability for late filing.<br><\/li>\n\n\n\n<li>Provides opportunities for negotiation and business continuity.<br><\/li>\n\n\n\n<li>Protects assets through express proceedings or the <em>Second Chance Law<\/em>.<br><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Frequently Asked Questions<\/strong><\/h2>\n\n\n\n<p><strong>What is the difference between ordinary and express insolvency?<\/strong><strong><br><\/strong> Express insolvency is faster and simpler, applied when there are no attachable assets. Ordinary insolvency involves full stages with administrators from the beginning.<\/p>\n\n\n\n<p><strong>What is the agreement stage?<\/strong><strong><br><\/strong> It is the negotiation phase where creditors and the debtor agree on new payment terms, aiming to continue business operations.<\/p>\n\n\n\n<p><strong>How are employees affected during insolvency?<br><\/strong> Employment contracts do not automatically end. If the company continues operating, salaries must be paid. Otherwise, dismissals or ERTEs (temporary layoffs) may apply.In 2025, <em>insolvency proceedings<\/em> in Spain have become more flexible and efficient, especially with the <strong>Organic Law 1\/2025 <\/strong>in Spanish<strong> <\/strong><a href=\"https:\/\/www.boe.es\/buscar\/act.php?lang=en&amp;id=BOE-A-2025-76&amp;tn=1&amp;p=\" rel=\"nofollow noopener\" target=\"_blank\"><strong>Ley Org\u00e1nica 1\/2025<\/strong><\/a> promoting digitalisation and simplified procedures. For both businesses and individuals, acting early and understanding your legal options is key to managing insolvency effectively and protecting your financial future. <\/p>\n\n\n\n<p><\/p>\n\n\n\n<p>You can also contact us directly through this<a href=\"https:\/\/entretramites.com\/en\/contact\"> <strong>contact Form<\/strong><\/a> for us to call you, or if you prefer, you can<a href=\"https:\/\/entretramites.com\/en\/consultancy\/free-tax-consultation\"> <strong>schedule a free consultation<\/strong><\/a> or write to us on<a href=\"https:\/\/api.whatsapp.com\/send\/?phone=34644034481&amp;text=Hola%21+Quisiera+saber+m%C3%A1s+sobre+sus+servicios&amp;type=phone_number&amp;app_absent=0\" rel=\"nofollow noopener\" target=\"_blank\"> <strong>WhatsApp<\/strong><\/a>. We&#8217;re here to make the process easier for you!.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Understand insolvency proceedings in Spain. Learn about voluntary, necessary, and express options under the new law.<\/p>\n","protected":false},"author":25,"featured_media":52352,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[9],"tags":[1152],"class_list":["post-52351","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal","tag-second-chance-law"],"acf":[],"_links":{"self":[{"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/posts\/52351","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/users\/25"}],"replies":[{"embeddable":true,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/comments?post=52351"}],"version-history":[{"count":1,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/posts\/52351\/revisions"}],"predecessor-version":[{"id":52353,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/posts\/52351\/revisions\/52353"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/media\/52352"}],"wp:attachment":[{"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/media?parent=52351"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/categories?post=52351"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/entretramites.com\/en\/wp-json\/wp\/v2\/tags?post=52351"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}