The global health crisis caused by the COVID-19 pandemic has led to major disruption of the economy and social welfare in Spain.
The lockdown measures keeping the population at home and closing down businesses under the state of emergency declared in Spain on 14 March, followed by the process of lifting restrictions and current uncertainty, with cases rising, have had a major impact on demand, production and investment decisions throughout the economy.
The situation has led the Spanish Government to adopt various measures to support the sectors and people most affected, making the jobs market more flexible and relaxing compliance with legal obligations.
The state of emergency has been declared twice, through (i) Royal Decree 463/2020 of 14 March 2020, which came into force on the same day ("RD 463/2020"); and (ii) Royal Decree 926/2020 of 25 October, coming into effect the same day (“RD 926/2020”).The first state of emergency (March) was initially declared for 15 calendar days, up to 29 March 2020. The Government requested six extensions, up to 21 June, when Spain entered into what is popularly known as the “new normality”. On 25 October 2020, in response to worsening infection rates, Spain’s Government declared a second state of emergency, in which the governments of its autonomous regions are playing a greater role. It is due to end on 9 May 2021.
This page features a collection of our insights on some of the key issues affecting businesses in Spain, split in different areas, to guide our clients in navigating across the uncertainties of the current situation. We hope you find it useful.
As it is an evolving situation, we will be updating each section regularly.
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One of the Government's priorities in economic matters has been to protect and support businesses in order to minimise the impact of the crisis and to be able to recover activity as soon as possible once the crisis is over. We highlight below the main measures taken to date.
With more diagnoses of Covid-19 occurring daily in Spain, employers should prepare for how they will respond. Here we identify the measures taken by the Government to strengthen worker protection and maintain employment.
The general halt in the economy and the uncertainty as regards how long the Covid-19 crisis will last are causing economic actors major concerns about their contracts and obligations.
This section provides an overview of the series of measures approved by the Government to enable the governing bodies (of both listed and unlisted) companies to operate during the Covid-19 situation and to comply with other corporate obligations in a more flexible way; and of the new system of control of certain foreign investments.
Private finance: the specific case of facility agreements. Borrowers and lenders on loan financings should consider certain commercial, practical, and legal issues that may arise from Covid-19.
Each organisation should have in place a crisis management policy to ensure that key employees and management are familiar with its operation.
As Covid-19 continues to spread across the country, each organisation should ensure it has in place a robust organisational resilience plan which addresses the following issues.
