Debt collection in Spain – Finance and Banking


UK: Debt collection in Spain

To print this article, all you need to do is be registered or log in to

Despite Britain’s exit from the EU, the latest statistics released by the government on current trade with Spain show that the value of goods and services traded between Britain and Spain over the past four quarters amounted to £34.2 billion. Spain is the 9 of Great Britainand the largest trading partner with UK companies exporting £13.1 billion worth of goods and services to Spain at the end of the third quarter of 2020.

Trading across borders should be supported by strong contracts incorporating a series of clauses to protect the business, including jurisdiction clauses and alternative dispute resolution (ADR) clauses in the event of a contentious issue, allowing you to pre-select the jurisdiction and to require the use of some form of ADR to solve a problem. This gives you some control over a dispute, defining how it should be handled and also removes any element of surprise, such as your business partner litigates in an unusual jurisdiction.

The contract should also ensure that the settlement terms related to the payment of invoices are fair but strict. Cash flow is the lifeblood of any business, outstanding debt can falter even the most successful businesses.

In the event of an unpaid invoice owed by a Spanish customer and you find yourself faced with the collection of a debt in Spain, you must always try to implement ADR, either mediation or arbitration if you have integrated ADR clauses in your contract.

Gonzalo Butori, a partner based between the London and Barcelona offices, commented “even if you have not included ADR clauses in your contract, you should approach your debtor with an offer of mediation or arbitration to resolve the problem. Being seen to try to find a solution before filing a lawsuit will show that you are making every reasonable effort to resolve the dispute without resorting to expensive and time-consuming litigation,” Gonzalo added. “Furthermore, resolving the dispute through a negotiated settlement has a better chance of preserving the business relationship. should they prove unsuccessful or impossible, there are a range of options open to the courts to reach a settlement.”

If it seems there is no choice but to take legal action, your debtor should receive a letter before action (LBA) setting out the debt and requesting payment within a number of days – usually seven or ten are – and stating that at the expiration of this period a claim will be issued by the court. The claim form will invite your debtor to pay the outstanding amount or file a defence. If your debtor files a defence, the case will be heard in court where both parties will present their case through their legal representative to the judge and the judge will decide the case.

If the judge decides in your favor and the debtor has still not paid the unpaid invoice, the litigation and dispute resolution lawyers of Giambrone & Partners will guide and advise you on the best option to recover your debt, which may include, among other actions, sending bailiffs to remove the debtor’s property up to the amount still due, issuing a third-party debtor order or, in some cases, an attachment order.

Gonzalo has acted in a wide range of international and domestic commercial litigation. He regularly appears at mediation and arbitration hearings.


He has acted as co-counsel in international commercial disputes under ICC Rules as well as in other Alternative Dispute Resolution (ADR) proceedings.

Gonzalo is recognized for his focus on client resolution as well as his strong ability to pursue his clients’ best interests. He has participated in a number of cross-border transactions involving various EU jurisdictions and achieved very successful results for his clients. He specializes in conflicts of laws and jurisdiction.

Gonzalo also runs the Latin America LATAM Desk in London, where the focus is on assisting South American businesses and individuals with interests in the UK on a variety of issues, including contractual disputes as well assistance to companies wishing to enter new markets. In addition to being admitted to practice in England and Wales as a Registered Foreign Lawyer (RFL), Gonzalo is admitted to practice as an Abogado, a qualified Spanish barrister in Spain, as well as Avvocato Stabilito in Italy and divides his time between London, Barcelona and Naples offices.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

POPULAR ARTICLES ON: UK finance and banking

Default interest – An unenforceable penalty?

DMH Standard

In the Matter of Ahuja Investments Limited v Victorygame Limited [2021] EWHC 2382 (Ch), the court held that a default interest clause in a loan agreement was a penalty clause and therefore unenforceable.

Regulatory overview

Proskauer Rose LLP

The Financial Conduct Authority (“FCA”) has issued Handbook Notice 96 which describes the changes to the FCA Handbook. This includes changes to technical standards on transaction reporting and the EU exit passport regulation.

Source link


About Author

Comments are closed.