The government plans to launch the call this week Law of Business Creation and Growth This will allow companies to start up with just 1 euro, will promote their growth and will establish measures to combat bad debts. His intention is to bring the draft to the Minister council so that it can start its public hearing process from there.
The main objective of the standard will be remove obstacles to the creation and viability of the company. And defaults are, precisely, one of the problems that often threaten their solvency by limiting or strangling their liquidity because the maximum legal term of the loans is not met. 60 days. It is also a particularly painful problem for SMEs and the self-employed, who allow large companies to take much longer to attend to their invoices for fear of deteriorating commercial relations. For this reason, they do not usually demand the legal compensations provided for in the regulation in case of non-compliance, such as recovery costs or indemnities, although they put pressure on their margins.
To combat the generalized non-compliance with this maximum period between companies, the regulations will deploy an incentive system for meeting payment deadlines and will implement electronic invoicing.
How to combat delinquency
On the one hand, the regulations foresee taking into account the term payments to be able to access public subsidies, by linking it with the fulfillment of the payment terms to its subcontractors. On the other hand, the generalization of electronic invoicing will help to make transparent the deadlines with which companies comply with their invoices.
It is also expected to increase transparency in payments and establishing a system of infractions and penalties or an extrajudicial conflict resolution system.
The regulations will also eliminate the requirement of having 3,000 euros to set up a company, reducing to a minimum of 1 euro the amount necessary to set up a Limited Company, and will allow the process to be solved electronically in just 10 days.
The law includes measures to diversify sources of financing and boost non-bank financing, on which the vast majority of companies depend, and to improve the business climate.
Precisely this week the Ministry of Economic Affairs and Digital Transformation has constituted the Sectorial Conference on Regulatory Improvement and Business Climate, which will be the body of direct dialogue between the Government, the autonomous communities and local corporations for cooperation in the field of economic regulation.
With this law, together with that of startups and the bankruptcy that the Ministry of Justice finalizes, the Government plans to cover the full range of measures to favor the entrepreneurship and tackling the problems that Spanish companies endure and which make it difficult for them to gain size, internationalize or even restructure the debt so that a crisis is not an almost corporate death sentence but rather a traversable obstacle.
The text of public consultation prior to thenteproject that will now take the Council of Ministers already recognized that “a larger company size would allow increasing productivity, resistance to potential crises and the ability to undertake the necessary investments to remain competitive in the context of the double digital and green transformation”, and pointed out that Spain ranks 30th in the report’s 190 ranking “Doing Business” from the World Bank on the business climate.
In addition, it pointed out that “the lack of an efficient procedure to deal with a restructuring of companies that guarantees their future viability it is pointed out as an element of legal uncertainty and vulnerability that hinders growth “, while excessive delinquency prevents many SMEs” from having solid balance sheets that allow them to address their growth. “
To reduce administrative burdens a reduction is also addressed, a substitution of certain authorizations or ex ante control systems of economic activity with responsible declarations.