Credits arising under interest rate swap agreements are (i) insolvency credits, as they do not fulfil the requisite of functional synallagma dependent on reciprocal obligations, and (ii) subordinate, because they involve payment of credits arising due to interest.
These regulations contain two provisions clarifying the regime applicable to SAREB (Company Managing the Assets derived from the Banking Restructuring) in its capacity as creditor in insolvency proceedings.
Spain takes its first step towards securing international interests in mobile equipment.
Act 14/2013, of September 27, 2013, favoring entrepreneurs and their internationalization (the “Act”), introduces a wide range of reforms on insolvency, corporate, tax and labor matters. Regarding insolvencies, it takes a more flexible approach to the quorum of financial creditors required for court-sanctioned refinancing agreements and it regulates out-of-court agree-ments for payment as mechanisms for out-of-court negotiation with creditors.
REFINANCING AGREEMENTS
The Madrid Provincial Court (Section 28) ruling of December 7, 2012, and the Barcelona Provincial Court (Section 15) ruling of October 4, 2012, judged the insolvency categorisation of a credit the receivers had categorised as subordinate because they held that the creditor company belonged to the same corporate group as the insolvent company.6 In both cases, the provincial courts analysed the concept of group for the purposes of insolvency before and after the reform of the Insolvency Act introduced under Act 38/2011.
The Supreme Court clarified the insolvency categorisation for interest rate swap contracts, classifying them as insolvency credits, as they fail to meet the functional synallagma requirement, which establishes functional reciprocal obligations.
RENTA CORPORACIÓN: CENTRE OF MAIN INTERESTS IN SPAIN
On the advice of Cuatrecasas, Gonçalves Pereira, RENTA CORPORACIÓN REAL ESTATE S.A. (“Renta Corporación”) applied for a declaration of insolvency jointly with three of its Spanish subsidiaries (RENTA CORPORACIÓN REAL ESTATE ES S.A.U., RENTA CORPORACIÓN REAL ESTATE FINANCE S.L.U. and RENTA CORPORACIÓN CORE BUSINESS S.L.U.).
SUPREME COURT RULING NO. 44/2103, OF FEBRUARY 19, 2013: INSOLVENCY CLASSIFICATION OF FINANCE LEASE INSTALMENTS DEPENDS ON SPECIFIC PROVISIONS OF THE LEASE AGREEMENT
Supreme Court finds that where a finance lease agreement releases the lessor from liability for defects, credits resulting from payments due before the declaration of insolvency and for those falling due after it are insolvency credits
JUDGEMENTS NO. 541/2012, OF OCTOBER 23, 2012, BY THE ZARAGOZA BRANCH OF THE COURT OF APPEALS, NOS. 413/2011, OF DECEMBER 19, AND 18/2012, OF JANUARY 18, BY THE BURGOS BRANCH OF THE COURT OF APPEALS, NO. 132/2012, OF APRIL 10, BY THE RULING OF THE VALENCIA BRANCH OF THE COURT OF APPEAL, AND NOS. 210/2012 AND 211/2012, BOTH OF JULY 20, BY THE ALICANTE COMMERCIAL COURT
Guarantees granted by a group company for securing a loan used to repay the insolvent party’s personal debts are detrimental to the insolvency estate. Article 10 of the Mortgage Market Act refers solely to mortgages that are already part of an issue of mortgage securities.