Depositphotos_12884114_s-2019Anyone who is a director of a Spanish limited company has certain legal obligations (which is why the director is required to accept the position) and is therefore liable for its acts and omissions when they in any way damage the company itself, its partners or creditors, the three most significant interests for which the Spanish juridical system provides greater levels of legal protection.

In relation to the protection of business partners, due to their more family-oriented and private character, it is in the case of limited liability companies that conflicts between partners and the administration must particularly be avoided.

The most frequent cases involve the failure of the directors to comply with the obligation to request the company’s dissolution or bankruptcy when the company is required to do so due to the closure of the business, cessation of business activity, or insolvency.

Spanish law imposes on directors joint and several liability for debts and social obligations following the legal cause for dissolution, if they fail to comply with the obligation to call a general meeting within a period of two months to adopt, where appropriate, the resolution to dissolve, as well as on administrators who do not request judicial dissolution or, as applicable, proceedings for provisional insolvency, within two months following the scheduled meeting, when said meeting has not been constituted, or from the day of the meeting when the resolution would have been contrary to the dissolution.

In these cases, creditors’ claims will be assumed to date subsequently to the legal cause for dissolution of the company and may therefore be the responsibility of the directors, unless the directors can show that they are of an earlier date.

Author: J. Escobedo

I am a member of the Tenerife Law Society since 1989 with a dedicated team for anyone who needs an immediate answer or long term solution to any practical or legal issues appertaining to any property or business investment in Spain. If you have decided to move to Spain to start a new life, whether that´s buying a property or a business, then you will definitely need the services of a good Spanish Lawyer who is fully conversant with Spanish protocol and who has a good command of the English language. I am based in the south of Tenerife and I am specialist in Property Law, Inheritance issues and taxes as well as Tenerife and Canarian law and a great deal more. ABOUT MY STAFF All my friendly and professional staff are fluent in English. We have been working for foreign clientes for over 30 years in Tenerife, providing legal advice and litigation services to all our clients investing throughout the whole of Spain and we pride ourselves on providing a high quality service to our clients in the form of clearer communication and advice.

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