I CORPORATE FINANCE, COVENANTS AND CREDITOR’S LIABILITY 2 II NATIONAL LEGISLATION 4 III EUROPEAN LEGISLATION 5 IV NATIONAL CASE LAW 5 NEWSLETTER I CORPORATE LAW WWW.CUATRECASAS.COM NEWSLETTER I CORPORATE LAW 2/6 CORPORATE LAW NEWSLETTER I CORPORATE FINANCE, COVENANTS AND CREDITOR’S LIABILITY Introduction In the field of corporate finance the liability of creditors that negotiate covenants with companies is an issue that currently generates great concern.

Earlier intervention in case of distress to preserve value and save jobs. That is the goal of the proposed 'EU Business Restructuring Directive', which was presented yesterday by the European Commission and aims to ensure a minimum harmonization of restructuring procedures within the European Union.

Supreme Administrative

Court Judgement of October 12, 2016

Case no. 0797/15

In this Judgment, the Supreme Administrative Court concluded that expenses related to employees, recorded as remuneration, salaries or wages, relevant to the limit of 15% foreseen for acceptance of the expenses with social benefits referred to in Article 43.2 of the CIT Code, are not limited to those that were subject to mandatory Social Security contributions.

South Central Administrative Court

Judgement of October 13, 2016

Under the Act of August 10 2016 modernising the Company Law 1915 (which entered into force on August 23 2016) Luxembourg law now officially recognises that companies can be wound up by means of a simplified procedure. This is an unquestionably useful tool which will further enhance Luxembourg's business-friendly reputation.

In judgment 297/2016 of September 22, 2016, by Commercial Court No. 6 of Madrid, the court rejects the appeal filed by a dissenting entity affected by a court-sanctioned refinancing agreement. The appeal argued the existence of a disproportionate sacrifice due to the standstill of the notarial enforcement of a pledge on shares already executed.

In its judgment 500/2016 of July 19, 2016, the Supreme Court interprets article 62.4 of the Insolvency Act, regulating the effects of contract resolution during insolvency:

If an agency agreement is resolved due to the agent being declared insolvent, the business owner must compensate the agent for clientele if the requirements under the Agency Act are met (the agent brought new clients or clearly increased transactions with existing clients, and the previous activity is still beneficial for the business owner). 

In its writ dated February 2, 2016, the First Instance Civil Court No. 38 of Barcelona raised a preliminary issue to the Court of Justice of the European Union. In that writ, it requested the EU court to determine whether the business practice of assigning or buying credits without offering consumers the possibility to settle the debt by paying the assignee the outstanding amount is in line with EU law.

Thanks to the Act of 10 August 2016 modernizing Luxembourg company law, which entered into force on 23 August 2016 (the “New Act”), the Grand Duchy now officially recognizes the possibility for companies to be wound up by means of a simplified procedure. This is unquestionably a useful tool which will further enhance Luxembourg's business-friendly reputation.

Op 13 juli 2016 zijn de consultatieversies van het wetsvoorstel Wet herstel en afwikkeling van verzekeraars (het "Consultatie Wetsvoorstel") en bijbehorende memorie van toelichting ("MvT') gepubliceerd. De consultatieperiode is op 28 augustus 2016 gesloten. Met het Consultatie Wetsvoorstel beoogt de minister het wettelijk kader voor herstel en afwikkeling van verzekeraars te versterken.