The General Council of Economists has shown dissatisfaction with the period of 15 business days established by the government for the public hearing of the Bankruptcy Law. In a statement, economists call it “ridiculous” that they can only make contributions to the reform from August 5 to 25.
From the Registry of Forensic Economists (Refor), a specialized body of the General Council of Economists of Spain in the matter of insolvencies, they point out that, for a law “of such depth”, it seems “not very serious that only 15 business days have been given to the public hearing process ”. In addition, they highlight that the period opens at a time when “Councils of Ministers are not even held for the summer holidays.”
The Government anesthetized the bankruptcies with the outbreak of Covid: since April it is not mandatory to present them nor can creditors demand them. The Ministry’s plan is, once the grace period has ended, in principle at the end of this year, that the European restructuring directive is ready. The companies will have a maximum term of 12 months for pre-bankruptcy, compared to the current four, and it will be easier to force creditors to accept restructuring agreements, among other measures.
During the state of alarm, and hand in hand with the official grace measures, the number of bankruptcy last year was 3,428, 5.6% less than in 2019, according to the College of Registrars. The objective is that, once it returns to normality, refocus the bankruptcy proceedings so that they serve to get companies going, and are not just the prelude to liquidation.
Valentín Pich, president of the General Council of Economists, despite understanding the “rush” of the Government to undertake the reforms committed to in the Transformation and Resilience Plan, considers that a reform such as bankruptcy, which affects the survival of companies, deserves a longer reflection period. They give the example of another rule that reaches great importance such as the draft Law on the Creation and Growth of Companies ”, whose term exceeds one month.
The reform is, in general terms, well valued by economists, as it promotes restructuring plans to try to avoid the largest number of liquidations, since the firms “are late” to the contest.