August 9, 2020

Contests of creditors up 14% and are baited in small businesses

The number of companies that declared themselves in bankruptcy proceedings – old suspension of payments – in the third quarter of the year was 963, 14% more than in the same period of 2018, and, of these, more than one fifth were small businesses, according to the provisional data provided today by the INE.

Among the data collected by the Bankruptcy Procedure Statistics, which until the end of the year does not provide the accumulated figures for the whole year, of that thousand of companies in question almost 22% was dedicated to small businesses, which anticipates and economic slowdown.

The total number of bankrupt debtors, which includes individuals without business activity and companies, was 1,384, 9.1% more than a year earlier.

By type of contest, 1,303 were volunteers (10.6% more than in the third quarter of 2018), and 81, necessary (10.0% less); by type of procedure, the ordinary ones increased 16.2% and the abbreviated ones, 8.4%.

Of the 1,384 bankrupt debtors registered in the third quarter, 963 were companies (natural persons with business activity and legal persons), and 421 natural persons without business activity, representing 69.6% and 30.4%, respectively, of total debtors.

83.9% of the companies in question were limited liability companies, and 33.9% were in the lowest tranche of turnover (up to 250,000 euros).

With regard to the activity carried out by the bankrupt companies, 21.7% were engaged in commerce, and 14.1%, in construction.

According to the number of employees, 56.0% had fewer than six employees, and of these, 28.2% had none.

The INE also takes into account the age of the companies in question, and their data reveal that 23.3% were 20 years old or older, and 21.6% were four years old or less.

Of the latter, 23.6% corresponded to the commerce sector; and of the companies bankrupt with 20 or more years of age, 50.9% of the bankrupt companies were engaged in commerce, industry and energy.

In a note, the INE reveals that Catalonia and the Community of Madrid accounted for 43.1% of the total debtors bankrupt in the third quarter of 2019, and highlights that Asturias had the largest annual drop in the third quarter (-37.1 %) and Extremadura, the largest increase (350.0%).

By autonomous communities, in Andalusia there were 146 bankrupt debtors, 61 in Aragon, 22 in Asturias, 38 in the Balearic Islands, 26 in the Canary Islands, 11 in Cantabria, 56 in Castilla y León, 41 in Castilla La Mancha, 374 in Catalonia, 185 in the Valencian Community, 18 in Extremadura, 59 in Galicia, 223 in Madrid, 33 in Murcia, 18 in Navarra, 62 in the Basque Country and 9 in La Rioja.

. (tagsToTranslate) contests (t) creditors (t) up (t) small (t) trade

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