In what circumstances should a company consider filing for insolvency?

Mainly when it cannot meet its payment obligations as they fall due (current insolvency) or foresees it cannot do so soon (imminent insolvency). The earlier action is taken, the more restructuring options remain.

Are creditor actions suspended once insolvency is admitted?

Yes. Most individual enforcement actions are automatically stayed, giving the company a protection period to reorganise or liquidate in an orderly manner.

What is the difference between restructuring and insolvency proceedings?

Restructuring is out-of-court negotiation with creditors. Insolvency proceedings are court-supervised, used when negotiations fail or the situation is urgent. An out-of-court approach is always tried first.

Can a business owner face personal liability in insolvency proceedings?

If the court classifies the insolvency as culpable, directors may be ordered to cover the deficit from personal assets on a joint and several basis. This underscores acting at the first signs of financial difficulty.

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Restructuring & Insolvency

Legal support for debt restructuring, insolvency proceedings, continuity planning and creditor negotiations for financially distressed businesses.

Who Is This For?

SMEs facing cash flow difficulties and debt pressure
Companies needing to negotiate a debt restructuring plan with creditors
Companies or individuals in insolvency proceedings requiring legal representation
Companies wishing to use preventive restructuring mechanisms to avoid insolvency
Foreign creditors holding claims against Spanish companies

What We Cover

Financial distress assessment and early warning

Pre-insolvency debt restructuring plan design and negotiation

Preventive restructuring plan drafting

Full representation in insolvency proceedings

Creditor negotiation and settlement agreement drafting

Business continuity plan design

Legal arrangements for orderly company liquidation

Cross-border insolvency proceedings (EU Insolvency Regulation)

Frequently Asked Questions