Recovering overdue commercial debt in Spain: the efficient approach

A service company — advisory firm, contractor, logistics provider, retailer — that has delivered its work and is not being paid is not facing a minor inconvenience: it is facing real cash-flow deterioration that, if allowed to accumulate, can threaten the viability of the business. Data from the Bank of Spain consistently show that average payment terms in the Spanish private sector significantly exceed the 60 days agreed by law, with SMEs bearing the brunt of late payment. Commercial debt is not an exceptional risk — it is a structural one that demands an organised, timely legal response.

Late payment as a legal problem, not just a financial one

When a client fails to pay an overdue invoice, the debt does not simply disappear: it prescribes. Article 1964 of the Spanish Civil Code, as amended by Law 42/2015, sets a five-year limitation period for personal actions to enforce obligations. For commercial debts between businesses, shorter periods may apply under the Commercial Code. Waiting too long means losing the right to claim.

The first principle governing debt recovery is therefore urgency. The earlier the proceedings begin, the greater the probability of recovery: the debtor has less time to reduce solvency, transfer assets or enter insolvency proceedings that would stay individual enforcement.

Available procedures: choosing the right route

There is no single path for claiming an overdue debt in Spain. The choice depends on the amount, the documentation available and the debtor's financial position. The main options are:

Payment order procedure (proceso monitorio) — Articles 812 et seq. LEC

The most efficient procedure for monetary, overdue and enforceable debts of any amount, provided there is documentation: invoices, contracts, delivery notes, emails, bank statements. There is no minimum or maximum threshold.

The creditor files a petition at the Court of First Instance (Juzgado de Primera Instancia) of the debtor's domicile. If the documentation is adequate, the court issues a payment order giving the debtor 20 working days to pay, prove payment or file an objection. If the debtor does not act within that period, the court issues an enforcement order directly — without a prior trial.

Under the Civil Procedure Act (Law 1/2000, as amended by Law 37/2011), no lawyer or procurator is required for claims up to €2,000. Above that, or where the matter is complex, legal representation is mandatory.

Realistic timeline: 3–6 months from filing to enforcement order if the debtor does not object. In the event of opposition, the matter proceeds to verbal proceedings (up to €6,000) or ordinary proceedings (above that).

Verbal proceedings (juicio verbal) — up to €6,000

For claims up to €6,000. More agile than ordinary proceedings, typically resolved in 6–12 months in the courts of the Región de Murcia.

Ordinary proceedings (juicio ordinario) — above €6,000

For claims exceeding €6,000. The most comprehensive procedure, with a preliminary hearing (audiencia previa) and oral trial. Estimated first-instance timeline: 12–24 months depending on court workload.

Direct enforcement of executive titles

If the creditor holds an executive title — a notarial deed, a judgment, an arbitral award or a notarised credit policy (póliza intervenida) — enforcement may begin directly without prior proceedings under Article 517 LEC. A notarised credit policy is particularly valuable for companies with recurring contractual relationships with the same client.

Precautionary measures: preventive attachment

Where there is a risk that the debtor may dissipate assets before judgment, the creditor may apply for preventive attachment (embargo preventivo, Article 727.1 LEC). The court may grant this inaudita parte — without hearing the debtor first — making it an effective pressure tool when debtor insolvency appears imminent.

Law 3/2004: the commercial creditor's statutory rights

Law 3/2004 of 29 December on combating late payment in commercial transactions, transposing EU Directive 2011/7, grants the creditor automatic rights from the moment of default:

• Automatic default interest: at the ECB reference rate plus 8 percentage points. For the first half of 2025, with the ECB reference rate at 4.40 %, the statutory default rate for commercial transactions stands at 12.40 % per annum.
• Minimum compensation for recovery costs: €40 per unpaid debt, automatically, without needing to prove the loss (Article 8 of Law 3/2004). For debts above €1,000, the creditor may additionally claim reasonable recovery costs.
• Maximum payment period: 60 calendar days for business-to-business transactions. Contractual terms exceeding this may be declared abusive.

These rights apply automatically even if not stipulated in the contract. Many businesses are unaware of them and do not claim them.

The adapted plan: why not all debts are managed the same way

A company with €20,000 outstanding across six different clients does not face a single problem: it faces six problems with different risk profiles. Each requires a different decision:

• Solvent debtor making excuses: immediate payment order (monitorio). The debtor's solvency makes recovery highly probable.
• Debtor with proven liquidity difficulties: structured payment plan with debt acknowledgment and collateral — bank guarantee, retention of title, mortgage. Negotiate before litigating.
• Uncertain solvency: apply for preventive attachment before initiating the main claim. This secures future enforcement.
• Insolvent debtor or one in insolvency proceedings: file the credit in the insolvency procedure. Standard civil proceedings are stayed once insolvency is declared.
• Small debts with high procedural costs: cost-benefit analysis. For debts below €300, the cost of proceedings may exceed the amount at stake.

Designing a recovery strategy means prioritising by solvency, amount and age of the debt, and selecting the most effective and cost-efficient route for each case.

How we help with debt recovery and unpaid invoices at RCM Legal

The main difficulty in managing unpaid invoices is rarely a lack of documentation — it is the delay in acting. Bank of Spain data show that the recovery rate for debts over 180 days old is significantly lower than for those under 60 days. Every month without action, the debtor consolidates their position, may transfer assets or enter insolvency proceedings that block individual recovery.

At RCM Legal we design a tailored recovery plan for each client's portfolio: we assess the solvency of each debtor, prioritise by recovery probability, prepare formal demand letters with certified proof of delivery, select the most efficient procedural route — monitorio, verbal or ordinary proceedings — and manage precautionary measures where insolvency risk is imminent. We work on results-linked fees wherever the structure of the matter permits. If your company has overdue invoices that are not being paid, tell us about the situation.