Updated Tuesday, 23 November 2021 16:50
The debtors exemption from filing bankruptcy is extended until June 30, 2022
The First Vice President and Minister of Economic Affairs and Digital Transformation, Nadia CalvioMarta PerezEFE
The Government has again extended the bankruptcy moratorium until the June 30, 2022, which maintains that debtors who are in a situation of insolvency do not have the duty to request the declaration of insolvency for at least half a year or more.
As Law 16/2020 was extended -which initially maintained the moratorium until December 31, 2020 and was subsequently extended until December 31, 2021- the contest requests required presented by creditors.
The objective is that viable companies under normal market conditions have legal instruments that allow them keep your activity and employment and have an additional margin to restore your equity balance while the modernization of the Spanish bankruptcy regime is being processed , the Government explained this Tuesday after the meeting of the Council of Ministers.
But the extension of this bankruptcy moratorium involves two risks. On the one hand, it increases the probability that there is a judicial collapse when the obligation to present competitions is reestablished, since there will be a wave of entries in the courts that must be reconciled with those that were in process.
And, on the other hand, given that companies are not obliged to file for bankruptcy, some experts warn that they are not taking sufficient measures to guarantee their survival, thereby aggravating the risk that the number of zombie companies grows.
The latter has warned on numerous occasions the Bank of Spain. The bankruptcy moratorium, if it is prolonged in time, can contribute to a higher survival rate of unviable companies, which, in the absence of certain financial support measures (bank refinancing or new credit from their contractual counterparts), will disappear in a short period of time. In the economic literature, these companies are often referred to as zombie companies, has pointed out.
Once the moratorium expires, now in June 2022, you can expect a significant rise in the number of applications for competition.
The ease with which Commercial Courts are congested highlights the relevance of analyzing possible solutions that promote the restructuring of the debts of insolvent but viable companies in the medium term, facilitate the liquidation of unviable companies and reduce the duration of insolvency proceedings to avoid the depreciation of business assets and increase the credit recovery rates from creditors, asked the supervisor.
The Registry of Forensic Economists (REFOR) warns today that one of the main threats is a possible collapse in the Courts due to the accumulation of bankruptcy proceedings after the end of the bankruptcy moratorium on December 31, 2021 and due to the coexistence of live bankruptcies of the system that is still in force; in which both systems will coexist for a time .
Match this warning Manuel Gordillo, partner of the firm Abencys, who points out that in view of the number of competitions presented so far this year, it is evident that the bankruptcy moratorium is generating a sedative effect in companies in difficulty, supply them in a false sensation that the decision on the measures to be adopted for the survival of the business can be postponed indefinitely.
The bankruptcy moratorium is not helping to promote survival, quite the contrary, artificially postponing the solution to the problem. Many companies in difficulties, which should have already faced difficult measures but necessary for their survival, continue to worsen their condition and move away from a solution, he laments.
He is in favor of fixing requirements to qualify for this moratorium, and believes that there are many companies that have taken advantage of the extension of the bankruptcy moratorium, delaying the presentation of the bankruptcy by not being forced to do so. In this way, zombie companies are more and more recurrent in the business fabric that, in reality, although they appear active, they do not have the capacity to continue with their activity, he points out.
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