Introduction This paper sets out to present a concise description of the amendments to the rules governing Spanish pre-insolvency arrangements pursuant to new Royal Decree Act (Order in Council) 4/2014, of 7 March, adopting urgent measures in relation to refinancing and restructuring of corporate debt (“RDA 4/2014”), in force as from 9 March 2014. This new text has introduced a series of important changes, most of them via amendments to the Spanish Insolvency Act (“SIA”), aimed at easing and expediting preinsolvency debt refinancing and restructuring processes in Spain.
The Cabinet has approved a Royal Decree Act (Order in Council) establishing urgent measures to expedite and streamline corporate refinancing and debt restructuring processes. In essence, these measures aim at ensuring the survival of companies that, notwithstanding the accumulation of excessive financial burden, are viable from an operational point of view through an orderly and balanced system of agreements with creditors and a wider range of refinancing options.
Section 547 of the Bankruptcy Code allows a bankruptcy trustee to recover transfers from creditors that are labeled “preferences.” To avoid a transfer as a preference, the trustee must generally demonstrate that the transfer: (1) was of an interest of the debtor in property, (2) was made to or for the benefit of a creditor, (3) was made on account of an antecedent debt owed by the debtor, (4) was made while the debtor was insolvent, (5) was made within 90 days before the petition date (within a year if the creditor was an insider) and (6) enabled the creditor to receive more than the c
Although property obtained by a debtor after filing for bankruptcy is usually safe from creditors, a recent case from the Ninth Circuit Bankruptcy Appellate Panel allowed a Chapter 7 Trustee to sell real property obtained by the debtors post-petition.
On 31 December 2013, Banco de Portugal issued instruction no. 32/2013 implementing new rules on the identification and flagging of distress debt financing restructures (“Instruction 32/2013”) and revoking its instruction no.18/2012 on the same matter.
Instruction 32/2013 is applicable to credit institutions and to financial institutions with lending activity as well as branches of credit institutions with head offices outside the EU (“Institutions”).
- The sale of productive units of a company subject to insolvency proceedings has become common practice in the Commercial Courts, especially those of Catalonia, which have the express support of the Directorate General for Industry of the Regional Government of Catalonia.
This procedural solution allows companies to continue as a going concern, ensuring the maintenance of jobs and avoiding the destruction of the business landscape.
(Auto del Juzgado de lo Mercantil número 1 de San Sebastián, de 19 de noviembre de 2013).
Este auto afirma la competencia del Juzgado de lo mercantil de San Sebastián para declarar la apertura del concurso de la sociedad Fagormastercook SA con domicilio social en Wroclaw (Polonia). La concursada es filial de Fagor Electrodomésticos S. Coop., cuya solicitud de concurso había tenido entrada en el mismo juzgado, si bien en la fecha del auto estaba pendiente de declaración.
In In re Nilsson, 129 Nev. Adv. 101 (December 26, 2013), the United States Bankruptcy Court for the District of Nevada certified the following question to the Nevada Supreme Court:
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”).
- La venta de la unidad productiva de las sociedades en concurso ha devenido en la actualidad un fenómeno habitual en los Juzgados Mercantiles, en especial de los de Cataluña que cuentan con el apoyo expreso de la Direcció General d´Industria de la Generalitat de Cataluña.
Esta solución concursal permite continuar con la actividad empresarial, asegura el mantenimiento de los puestos de trabajo y evita la destrucción del tejido empresarial.