- Introduction
On 7 September 2014, Royal Decree Act 11/2014 on urgent measures in insolvency matters (“RD 11/2014”) came into force, introducing important changes in the Spanish Insolvency Act (“SIA”), especially regarding incourt proceedings, whether within a composition or a liquidation stage. This piece of legislation followed Royal Decree 4/2014 (“RD 4/2014), which introduced equivalent measures for preinsolvency restructurings.
Act 26/2013, passed on 27 December 2013 and published in the Official Journal of Spain on 28 December 2013 has amended the provisions of the Spanish Insolvency Act (the “SIA”) related to out-of-court restructuring. In particular Act 26/2013 modifies the 4th Additional Disposition of the SIA which allows to, upon certain circumstances, force extensions to dissident financial creditors in Spanish restructurings through the intervention of a Court (hereinafter, the “Court Homologation”).
Introduction
1. Introduction
Given the situation of Spanish market generally —and the latest reforms on restructuring of the financial sector more particularly— it seems that cash flow shortage may be ongoing in the near to mid term future for some Spanish corporations. Upon this situation stressed or distressed companies may consider rescue financing alternatives in substitution —or in addition to— other traditional funding. Generally within a broadest restructuring deal, non-bank lenders may have an interesting role to play in providing for liquidity facilities.
This paper aims to briefly describe the scenarios where acts or actions might be rescinded (particularly in the context of refinancing or debt restructuring of Spanish companies) pursuant to the Spanish Insolvency Act (“SIA”) and the consequences of rescission from a legal standpoint. Procedural questions related to the subject matter are not analyzed in this document.
What acts can be rescinded?
1. Introduction
Act 26/2013, passed on 27 December 2013 and published in the Official Journal of Spain on 28 December 2013 has amended the provisions of the Spanish Insolvency Act (the “SIA”) related to out-of-court restructuring. In particular Act 26/2013 modifies the 4th Additional Disposition of the SIA which allows to, upon certain circumstances, force extensions to dissident financial creditors in Spanish restructurings through the intervention of a Court (hereinafter, the “Court Homologation”).
Introduction
This paper aims to briefly describe the scenarios where acts or actions might be rescinded (particularly in the context of refinancing or debt restructuring of Spanish companies) pursuant to the Spanish Insolvency Act (“SIA”) and the consequences of rescission from a legal standpoint. Procedural questions related to the subject matter are not analyzed in this document.
What acts can be rescinded?
1. Introduction
Given the situation of Spanish market generally —and the latest reforms on restructuring of the financial sector more particularly— it seems that cash flow shortage may be ongoing in the near to mid term future for some Spanish corporations. Upon this situation stressed or distressed companies may consider rescue financing alternatives in substitution —or in addition to— other traditional funding. Generally within a broadest restructuring deal, non-bank lenders may have an interesting role to play in providing for liquidity facilities.