Debt Collection in Spain

For any business or individual, debt collecting is sometimes a tedious necessity. In Spain, it can be very slow and, all too often, unproductive. You can maximise your chances of success by taking some basic and inexpensive precautions and planning ahead. This guide covers what to do and how to do it.

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This guide covers…

This guide is about how to collect your debts – money owed to you – in Spain. It covers money owed to you by local (Spanish) people and companies and debts owed by people and companies based overseas.

Whilst collecting debts is really only a particular type of court case, it so common and sufficiently different in the detailed processes involved that we thought it deserved a spacial guides.

This guide describes, in particular, the process in the area of Andalusia/Andalucía – which contains the Costa del Sol. See a map here. Please note that certain aspects of the law in Spain vary from one “autonomous community” (comunidad autónomalightbulb image - click here for more information on this subject to another.


Debt collection problems can kill a business. At best, they can divert a lot of time, effort and money that would be better spent on other things.

The Spanish are known for their relaxed attitude towards legally binding terms of payment. Even a new law in 2013 (making the maximum period for paying an invoice 60 days) has helped only a little. Actual payment terms commonly stretch to 80 or 90 days.

Large companies are no better than small ones, possibly worse.

Small foreign owned companies can be even more cavalier.

Even the Spanish government is known for being a late payer!

Liability to pay debts

Different types of people and companies have different responsibilities when it comes to paying their debts.

Liability for business debts is determined by legal structures:

Private individuals

Private individuals are fully responsible for their debts unless they are granted bankruptcy. Under the 2105 Second Opportunity Law, in order to be declared bankrupt a person:

  • Must have filed an insolvency procedure which concluded that outstanding debts & liabilities outstrip assets
  • Must not have been convicted of a catalogue of economic related crimes within the previous ten years
  • Must have tried reaching an out-of-court settlement with its lenders & creditors

Furthermore, the insolvency procedure must have concluded that the borrower is not guilty or at fault. They must be borrowers in good faithlightbulb image.

Sole Proprietor Businesses

Sole Proprietor Businesses (Empresario Individual or Autónomo) are small businesses managed by an individual and for which no commercial structure is necessary.

The owner is liable for all business debts.


Two or more individuals may share ownership of a business by way of a partnership (Sociedad Colectiva). The partners will be jointly and individually liable for the debts of the business.

Limited Liability Partnerships (Sociedad Comanditaria) offer limited liability to the partners.

Private Limited Liability Companies

Private Limited Liability Companies (Sociedades de Responsabilidad Limitada, SL or SRL) and New Enterprise Limited Companies (Sociedades Limitadas Nuevas Empresas) can really only be chased as a company, however wealthy their shareholders might be. The shareholders’ liability is limited to the amount of their contribution to the company.

Public Limited Liability Companies

Public Limited Liability Companies (Sociedades Anónimas, SA) can also really only be chased as a company. The shareholders’ liability is limited to the value of their shares.

Representative Offices

Foreign companies may operate in Spain through Representative Offices. There is no limitation to the liability of the foreign parent company for the debts of its representative office. However, depending upon where the parent company is based, debts may be more complicated to collect as they can involve international enforcement action.

Avoiding debts

Debts can never be completely avoided but they can be minimised by some common sense and inexpensive steps.

Know your customers

As a result of the laid back attitude to payment, your Spanish customers feel less social pressure to pay your invoices on time than they might in some other countries. So it is worth being careful who you do business with.

Unfortunately, except for companies listed on the stock exchange, little financial information about Spanish companies is publicly available.

Businesses do have an obligation to publish financial reports in the Mercantile Register, but the information is often not reliable, Failure to publish can, however, allow some pressure to be applied to the debtor as a lack of publication may lead to striking the company off the Register.

Debt collection agencies can offer credit ratings on potential customers. This can be worthwhile if large sums are likely to be involved.

Good contracts

Good, well drafted, contracts can make it much easier to collect your debts.

They can make sure that payment periods are agreed and recorded. They can also lay down processes for dealing with any disputes that can, too often, be used as an excuse for late or non-payment.

They can also provide for substantial interest for late payment.

Retention of title clauses

If you supply valuable goods, think about using retention of title clauses. These mean that you remain the owner of the goods until you are paid – and can recover possession of them if you are not.

They are seldom used in Spain – though permitted – as the formalities involved are a little onerous. The contract must be signed in front of a notary and then registered.

Interest on late payments

Your contract should specify a maximum period for payment of your invoice. If nothing is agreed, it is 30 days. The maximum permitted by law is 60 days.

After the due date, you are entitled to interest at the rate specified in your contract or, if none is mentioned, at Euribor + 8%: an attractive rate if you ever get paid.

Immediate Action

The legal process in Spain is slow. Cases can take up to two years to go through the courts: more if the party appeals, as the majority do.

As a result, taking effective action yourself is essential and cost efficient.

  • Call your customer and ask why no payment has taken place;
  • If you unable to resolve the matter informally, check whether your contract provide for any resolution process. If it does, use it. This is usually quicker and cheaper than going to court
  • Send a demand letter by registered post (“burofax”).
  • Be aware that your Spanish debtor may try to play for time. It is so in every country. Pursue payment, but don’t delay taking further action if it is not forthcoming quickly.

Unconventional debt collection

In Spain there are a number of companies who use unconventional means to put pressure on debtors. You may or may not be comfortable with this.

The cobrador del frac (the frock-coated debt collector), is a peculiarly Spanish institution. It is a simple and powerful device. If you see a man dressed in a black frock coat and top hat, carrying a black brief case standing outside an office, a house or next to someone’s table in a restaurant, you know that person has not paid their debts. In effect, they are being named and shamed.

All the person has to do is stand there. They never speak to the subject. They never do more than hand the debtor a business card.

The cobrador del frac has offices throughout Spain. See their website.

Mainstream debt collection agencies

The slowness of the court system means the use of conventional debt collection agencies is widespread.

They use regular contact with the debtor – by letter, email and phone – to negotiate a payment and ensure that it is made.

See for example, here.

Collecting debts from people and companies in Spain

Phase 1: amicable solutions

As we have already said, the judicial process in Spain is very slow, so it is usually a good plan to make concessions at the amicable stage in order to avoid legal action. Some guaranteed money now is better than the possibility of more money in a couple of years’ time!

Before starting legal proceedings against a debtor, check whether it has any assets.  If the debtor has no assets you will not recover anything and be wasting your money and your time.

If the debtor has assets (a car, a boat, a bank account, a house etc) you may want to put a charge on them. If you succeed in doing this you will have priority over any unsecured creditors.

In addition, check the debtor’s solvency status. If insolvency proceedings have been started it becomes impossible to enforce a debt.

Phase 2: going to court

Types of court case

If the debt is clear, of a certain amount and undisputed, fast-track proceedings may be available.

  • The ‘juicio cambiario’ (bill of exchange case) is for the recovery of debts documented by a promissory note, cheque or bill of exchange. The process is very short by Spanish standards (only about nine months).
  • The ‘juicio verbal’ (oral court case) can be started for all claims below EUR 6,000.
  • The ‘juicio monitorio’ (money payment case) only requires common commercial documentation such as invoices and delivery notes to prove the case. The juicio monitorio was originally created for claims up to EUR 250,000 but this limit has now been removed.
  • The ‘monitorio notarial’ (notarial money claim) allows, since 2015, a claim for payment to be made through a notary, rather than the court.
    • If the debtor acknowledges the debt (or fails to appear within 20 days from the notice of claim), the debt is proved and the process then becomes one of attachment proceedings against the debtor’s goods. These attachment proceedings must always be done through the court.
    • If the buyer doesn’t acknowledge the debt, the process becomes a juicio ordinario (ordinary court case).

Failing an applicable accelerated procedure, and provided the debt if for more the €6,000, ordinary legal action (juicio ordinario) would usually commence when amicable attempts at collection have failed.


Legal action will usually start with a registered letter of demand. This has real no legal value but it does remind the debtor of their obligation to pay the debt plus late payment interest within ten days and it sometimes produces a payment. The debtor can also make a proposal to pay the debt by instalments.

If he does not respond, the creditor would file a claim with the District Court for the area and serve the debtor with a Summons.

The debtor is then given 20 days to file a defence. If he does, the parties exchange arguments, and a preliminary hearing is organised by the court prior to its making its decision. See our Guide to disputes & Court Cases in Spain for more information about how these progress.

Time limits

Commercial claims for transactions that occurred before October 2015 must be brought to court within 15 years. After that date commercial claims must be made within five years.

There is a three year limitation period on unpaid promissory notes and cheques.

Provisional measures

In exceptional circumstances, provisional measures – measures taken by the court before it has made a judgement about the case – may help to preserve the creditor’s assets pending a final decision.

Upon request, the courts may order a range of far-reaching provisional measures such as attachment of the debtors assets or some form of order to do (or refrain from doing) something.

To obtain provisional measures, it is necessary to show that the claim has a good chance of success and that these precautionary measures are necessary. In emergency situations, such as the immediate risk of the debtor disposing of assets, the court may take its decision without the debtor being present.


Decisions rendered by these courts may, within 20 days, be appealed to the Appeal Courts, which would review the case, taking both issues of law and fact into consideration.

The decision of that court may also be appealed in relation to points of law.

Enforcing court decisions

A judgement is enforceable as soon as it becomes final (i.e. when all appeals have been exhausted).

If the debtor fails to satisfy the judgement within 20 days, and upon request, the Court Clerk shall issue an order to start enforcement proceedings and shall contact financial institutions, public registries and any other relevant company or person so that they provide a list of any assets belonging to the debtor.

These assets shall then be attached in the following order:

  1. Cash or current accounts of any kind
  2. Credits and rights realisable immediately or in the short term, and entitlements, securities or other financial instruments that can be negotiated on an official secondary securities market
  3. Jewels and works of art
  4. Income in cash, regardless of its source
  5. Interest and other income of any kind
  6. Movable property or livestock, shares, titles or securities not capable of being negotiated, and company shares
  7. Real estate
  8. Wages, salaries, pensions and income from self-employed professionals and commercial activity
  9. Credits, rights and securities realisable in the medium and long term

The debtor may negotiate alternative arrangements or appeal the enforcement order within five days of delivery, however the appeal would not suspend the enforcement proceedings.

How long could legal action take?

The juicio cambiario should take about nine months.

The ‘juicio monitorio’ would often take about a year.

Obtaining a court decision under the ordinario proceedings would take about 18 months, but enforcement could at least double this time.

How much could this cost?

Court fees (tasas judiciales) depend on the type of procedure.

Your legal fees are likely to be much higher.

Collecting debts owed to you from people outside Spain

When the debtor company has assets in other EU Member States, a European Payment Order procedure facilitating the recovery of undisputed debts (under Regulation EC No 1896/2006) may also be triggered. In this case, the creditor may request a domestic court to issue an Order to Pay which will then be enforceable in all European Union countries (except Denmark) without the usual complicated and slow exequatur – the international enforcement claim.

When the debtor lives outside Spain you may, depending upon your contract, have to take proceedings in Spain – and then enforce the judgement in the other country – or bring the claim in another country.


Debts are best avoided but, if that can’t be done, you need to take action quickly.

To do this it helps if you have already decided which approach you will take and who you will use to do it.

Attempts at debt collection – before going to court – are usually worthwhile provided they don’t take too long and give the debtor the chance to dispose of his assets or claim bankruptcy.

You might also want to read

Collecting debt in Spain: Collection Profile (Euler Hermes) 

The payment behavior of Spanish companies remains poor, with payments often occurring in 70 to 80 days on average. Commercial credit (late payment) constitutes an underlying feature of commercial exchanges in Spain.

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