Restructuring: A real lifeline

There is a lack of knowledge about restructuring plans in Spain. The keys to their success according to experts in insolvency law

Pictured: Pérez-Llorca partner, Javier García Marrero; Cuatrecasas partner, Rosa M. Gual; RSGM Abogados partner, Alejandro Rey; Bird & Bird partner, Alfonso Carrillo Cano and Herbert Smith Freehills partner Javier de Carvajal Cebrián.

by julia gil

Currently, in Spain, there are not even 200 active restructuring plans submitted for approval. “We must certainly consider this an insufficient number,” explains the founding partner of RSGM Abogados, Alejandro Rey, “if we take into account that, in September 2022, with the entry into force of the new Insolvency Law, we were all predicting a much higher number.”

The year 2023 was marked by very resounding cases in the field of financial restructurings such as Celsa, Naviera Armas, Xeldist, Telepizza or Ezentis. However, Rey warns about the lack of knowledge that exists among the business community and the poor concept of insolvency law which “means that, to date, the tools that insolvency law brings to the table are viewed with a certain reluctance among a large part of the business community” and because, among business operators, these are seen as solutions to be used as a “last resort”. It is for this reason that it is necessary to understand in depth the purpose of these plans and when to evaluate their application.

Why are so few plans active in Spain?

This can be understood a little better if we go back to the fact that, previously, there was only the figure of refinancing agreements. However, this situation changed when the new law 16/2022 of September 5 introduced the figure of restructuring plans. However, this raised “numerous initial doubts as to certain questions of practical application”, according to the partner of the litigation and arbitration practice of Herbert Smith Freehills, Javier de Carvajal Cebrián. “Today, we already have relevant jurisprudential resolutions of Provincial Courts and, increasingly, more and more use is being made of this pre-bankruptcy tool, not only by large companies but also by medium-sized companies, which is proving to be really useful in trying to overcome the economic difficulties of companies”.

In countries such as the United Kingdom, the figure of restructuring plans was introduced by the Corporate Governance and Insolvency Act of 2020. “They are a few years ahead of us,” explained the partner of the English firm, De Carajal. “Initially their adoption was slow, but once the process was understood their use increased, although there they are used for more complex restructurings and coexist with schemes of arrangement.” And, although there are some differences depending on the jurisdiction, the partner makes it clear that the basis is shared.

Eligible companies


Julia Gil