{"id":4255,"date":"2015-04-09T10:00:01","date_gmt":"2015-04-09T10:00:01","guid":{"rendered":"http:\/\/www.asociacion-eurojuris.es\/en\/?p=4255"},"modified":"2020-04-11T07:22:43","modified_gmt":"2020-04-11T07:22:43","slug":"the-liquidation-of-companies-in-spain","status":"publish","type":"post","link":"http:\/\/www.asociacion-eurojuris.es\/en\/the-liquidation-of-companies-in-spain\/","title":{"rendered":"The liquidation of companies in Spain"},"content":{"rendered":"

Due to the economic and financial crisis in Spain, many companies declared bankruptcy<\/a> in the past few years. Notably, Spanish subsidiaries of solvent German parent companies seem to prefer the legal option of company liquidation.<\/p>\n

The important characteristics of company liquidation are mainly the termination of legal relationships with third parties and, if the case arises, splitting the company\u2019s assets among the associates in order to terminate the company.<\/p>\n

The Law on Corporations (\u201cLey de Sociedades de Capital\u201d, aka \u201cLSC\u201d) provides for\u00a0 dissolution, liquidation and termination.<\/p>\n

Generally, dissolution is a decision by the shareholders\u2019 meeting to initiate the liquidation process.<\/p>\n

The causes for dissolution as stated in the provisions of the LSC include:<\/p>\n

a) Failure to achieve the company\u2019s purpose or its clear impossibility, or the deadlock of the company\u2019s governing bodies so that continuation is impossible.<\/p>\n

b) Losses that reduce the company\u2019s assets to an amount lower than half the company\u2019s share capital, unless the company\u2019s share capital increases enough that filing insolvency is not necessary.<\/p>\n

c) Reduction of the company\u2019s share capital to an amount lower than the legal required minimum of 3,000\u20ac for limited liability companies.<\/p>\n

Notwithstanding the above, the company can also be dissolved through a simple decision by the general meeting.<\/p>\n

The consequences of such a decision are among others:<\/p>\n