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In Spain, the enactment of successive royal decree-laws containing measures in the areas of labour, taxation, commercial and mortgages, among others, have sought to mitigate the negative effects of the health crisis on the social and business spheres. With respect to the latter, Spanish companies, accustomed during the last five years to operating in an environment of economic expansion, have witnessed the greatest drop in GDP since 2009, and have been forced to revise strategies and business plans in order to guarantee their continuity. Given the uncertainty about the coming months and the danger of possible resurgence, we believe it is necessary to analyse the degree of compliance with the various obligations that companies have to face.
In the corporate field, for example, we will have to review the company’s bylaws to ensure that meetings of governing bodies and general meetings are held remotely, that votes are delegated, etc. From the tax point of view, in the face of a possible scenario of a fall in demand, there should be a tendency to relax cash flow tensions with all the tools available (e.g. application for tax relief, management of tax deferrals and/or fractioning, search for new sources of financing, etc.). In the contractual field, it is the right time to review contractual obligations in the short and medium term and thus be able to design a strategy in the event of a possible breach (e.g. renegotiation of the clauses, resolution, withdrawal, inclusion of a “rebus sic stantibus” clause, etc). Likewise, at the labour law level, every company must adopt and update health and hygiene protocols that guarantee that the work of its employees can be carried out in safe and healthy conditions.
Finally, from the regulatory compliance point of view, we must not forget that the current process of digitalisation may facilitate the commission of illicit acts, and it is entirely advisable to draw up and adopt a compliance programme that identifies, monitors and manages the risks that may occur within the company.
In short, we are facing an unprecedented and uncertain situation capable of overcoming any contingency plan; but we must not forget that after each crisis new opportunities arise that allow us to create and generate value.
At Seegman we have prepared two documents that we believe are of interest to our clients in relation to the regulations published during the COVID-19 crisis. The first is a compilation of approved regulations, grouped by subject and ordered chronologically, which we have been updating and publishing periodically through our LinkedIn profile for our clients to access. This document is useful to see briefly all the relevant approved regulations. The second document is a more detailed summary of the different measures approved, grouped by subject and with a distinction between those that remain in force after the end of the state of alarm and those that were only in force during the same. This document is useful to have a greater detail of what is applicable in each area.