Lawyers messed up Spanish insolvency

Author: | Published: 1 Nov 2009
Rules meant Llanera’s assets were allowed to decay

The Spanish insolvency system didn’t work when the credit crisis hit, largely because “it was written by lawyers”. The Italian system has been very speedy in its solutions, despite everyone being on the beach in August. And US bankruptcy judges are unfairly maligned, given that they are effectively in the job for life. These were some of the conclusions reached in an active exchange at the session ‘The new role of governments in restructuring’ this morning at the IBA annual conference in Madrid – even though it took place in the rather hot, dark and damp Ontario room on the ground floor.

The co-chair of the section (Insolvency, Restructuring and Creditors’ Rights), Carsten Ceutz, first explained that the room had no ventilation in order to keep out the noise. Then he...