The COMI (Center Of Main Interest) in insolvency law in Spain

FERSINT CENTRAL EUROPE KFT UNIPERSONAL, Ltd, a Hungarian company, filed for insolvency at the Commercial Court of Bilbao (Spain) together with two Spanish companies of the same group [Commercial Court No. 1 of Bilbao 4 May 2009, Resolution 292 / 2009]. The company filed for the insolvency proceedings in Spain arguing that its COMI was located in Bilbao because the Hungarian company was created to market products developed in the Hungarian factory, which was never built. At that time, the company was led by the parent company in Bilbao.

The judgment established that, pursuant to Art. 3 para 1 of the EIR, COMI was located in Bilbao based on three criteria:

  • 100% of the capital was owned by a Spanish company, which was declared insolvent at the Commercial Court No. 2 of Bilbao.
  • The social administrator had his residence in Bilbao.
  • The commercial relationships, as evidenced by the documentation submitted as part of the application, were undertaken in Bilbao.

This decision is a clear example of the interpretation of COMI for companies in the Spanish jurisdiction.

A creditor of Mr. Hugo, who was of German nationality but resident in Spain (Benissa, Alicante), filed for his insolvency before the Spanish Commercial Court of Alicante [Commercial Court No. 1 of Alicante 16 June 2008, Resolution 149 / 2008]. Mr. Hugo objected to the jurisdiction of the Spanish Court stating that the German courts were competent because he had German nationality. The judgment established that, in accordance with Art. 3 para 1 of the EIR, Mr Hugo’s COMI was located in Alicante.

If the insolvency proceedings are related to a natural person, the COMI shall be considered to be located in his place of residence. In the case analyzed, it was shown that:

  • Mr. Hugo had his residence in Benissa, as evidenced by the power of attorney of Mr. Hugo.
  • Some notifications regarding a lawsuit filed against Mr. Hugo were provided in Benissa to an employee of the debtor.
  • The notification of the writ of insolvency was also delivered in Benissa.
  • Mr. Hugo had a bank account at a bank of Benissa.
  • Mr. Hugo had a telephone line in Benissa.
  • Mr. Hugo’s wife said in a prior judicial proceeding followed in Germany that her residence was in Benissa. Since no legal separation had been confirmed, it must be assumed that he had the same residence as his wife.
  • There was a negative certification of residence of Mr. Hugo established in Germany.

This is an uncommon judgment in Spain since it relates to the insolvency proceedings of a natural person. The special value of this judgment lies in the deep study undertaken by the Court about the facts that should be taken into account in order to determine the COMI of a natural person according to the EIR.