Spain - The Art of the Pre-Pack

2024-01-01T18:14:00
Spain
Overview of restructuring tools, the most relevant amendments to the SIA, and alternatives for imple­menting a pre-pack sale
Spain - The Art of the Pre-Pack
January 1, 2024
The Spanish insolvency regime has undergone major recent changes that aim to build a framework that facilitates out-of-court restructuring to secure the viability of distressed debtors and provide for an expedited route to facilitate the emer­gence of insolvent companies.

Since the Covid-19 pandemic, the Spanish Insolvency Act (SIA) has been amended on two occasions.

  • In May 2020, the Spanish government approved the recast SIA, which attempted to harmonise, clarify and refine Spanish insolvency regulation. This increased the number of articles within the SIA from 242 to 755.
  • In September 2022, an amendment to the recast SIA entered into force. This amendment implemented the provisions of the EU Directive on Restructuring and Insolvency, and has strengthened pre-petition restructuring tools, making them more flexible and efficient, and expedited insolvency proceedings.
The amended SIA provides agents involved in restructuring with several tools to tackle insolvency at an early stage, which enables them to avoid lengthy value-eroding insolvency proceedings. The SIA now provides two new tools that allow the implementation of pre-packs sales: a prepackaged sale within a restruc­turing plan; and the possibility to implement a pre-pack sale.

This chapter provides an overview of the key restructuring tools, highlighting the most relevant amendments to the SIA, and analyses the alternatives for imple­menting a pre-pack sale within the new regime, assessing whether these new tools will be used in practice.

See complete chapter at: The Art of the Pre-Pack. Global Restructuring Review, Third Edition, 2023.
January 1, 2024