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2023 starts with many key legal issues and dates to be marked on the calendar in different areas of law. The regulatory changes that have been taking place in the last weeks of 2022 will mark the actions of companies in their legal strategies.
Some of the legal dates and key milestones that our expert lawyers predict are still up in the air, while others that have already materialized will create new scenarios that will have to be regulated.
In this article we gather the main legal issues and dates for 2023 that our executives and partners in the areas of labor, tax, public-regulatory, environmental, bankruptcy, commercial and banking law recommend to follow, with their opinions on these matters.
Key Legal Issues in 2023
Assessment by Enrique Ceca, partner of the labor department, about key legal issues in 2023 in labor law:
The year 2022 has come to an end and Agenda 2023 is full of new developments that force companies to be more alert than ever to comply with all the requirements that are coming up in this new financial year.
There is no doubt that the protocolisation seems to be the best solution to deal with many of the matters that are affected by recent and future legislative changes. In particular, companies should consider starting with the implementation of (i) sexual violence prevention protocols, (ii) whistleblowing procedures, (iii) sustainability and good governance policies, and (iv) diversity management plans.
Finally, the enormous impact of the current economic situation on salary negotiations for the coming year, as well as on the pension system, should not be forgotten.
His milestones for the year:
- Implementation of protocols for the prevention and reporting of sexual violence in the light of the new "only yes is yes" law (during 2023).
- A step beyond equality: Diversity management plans (during 2023).
- What changes will the Trainee Statute bring for companies (during 2023).
- The Spanish law transposing the Whistleblowing Directive is coming (during 2023).
- The problem of salary revisions in the face of economic uncertainty caused by inflation (during 2023).
- Is 2023 the year of sustainability and ESG obligations (during 2023).
- Has the Startups Act provided a solution to the countless doubts about the provision of remote services abroad? (from January 1st, 2023).
- New pension measures (from January 1st, 2023).
Assessment by Javier Fernández Cuenca, partner of the tax department, about key legal issues in 2023 in tax law:
Everything indicates that the main tax measures, or at least the costliest for taxpayers in general, are already being taken at the end of 2022. The 2023 elections will foreseeably provide an incentive not to take more, or to take beneficial measures. Therefore, I believe that the main challenge facing tax advisors in 2023 will be managing the application of the new tax figures that are being created at the moment, which will undoubtedly generate litigation in the medium term.
In particular, the new tax on large fortunes will pose a planning challenge for family groups, especially those located in the autonomous communities that subsidize Wealth Tax and Inheritance and Gift Tax. There is no doubt that the refund of this tax will be massively demanded by taxpayers, as its creation is more than questionable.
The key legal issues for 2023:
- Penalization of savings, increasing their taxation, further reducing the tax benefits of PPs and creating the tax on large fortunes (in force since December 29th, 2022).
- Creation of new taxes, such as taxes on energy, banking, as well as plastics and waste (in force since December 29th, 2022).
- Collision of the government with the Autonomous Regions with competitive approaches to Wealth Tax and Inheritance Tax.
- Limitation to the tax efficiency of the tax consolidation regime only for 2023, through the deferral to 10 years of the compensation of losses of loss-making companies, included in Law 38/2022, of 28 December.
- Cultural sector: possible relaxation and improvement of tax incentives for investments.
- Extension of the scope of application of the IRNR to persons with foreign companies whose main asset is real estate in Spain.
- Relaxation of the application of the special regime known as the "Beckham Law" from 2023 onwards.
- Introduction of special features in the tax regime for stock options in start-up companies and classification of the carried-interest paid by venture capital management entities as remuneration for work (in force since December 28th, 2022).
- Tax reductions, especially in VAT, aimed at protecting the most vulnerable groups in society:
- Reduction to 5% of the VAT rate applicable to the supply of natural gas and extension of this rate for the supply of electricity
- Reduction from 4% to 0% for certain basic products in the shopping basket, and from 10% to 5% for oils and pasta
Insolvency and restructuring Law
Assessment by José Carlos González, partner of the bankruptcy department, about key legal issues in 2023 in insolvency and restructuring law:
2023 will be the litmus test for the insolvency reform approved in September 2022 and which meant the transposition of the Restructuring and Insolvency Directive of 2019, not only because it will be when a relevant part of it comes into force (that applicable to micro-companies) and also when its essential regulatory development will hopefully see the light of day, but also because, due to the foreseeable economic recession that we will suffer in the first half of the year, the exponential increase in insolvency proceedings that we have already seen in the last quarter of 2022 will continue and, above all, the use of the two new instruments that Law 16/2022 has brought us: the new restructuring plans and the accelerated sales of production units ("insolvency prepack").
We will have to see how this increase is managed by our already overcrowded Commercial Courts and to what extent the new telematic mechanisms that are due to come into operation at the beginning of 2023 (liquidation portal, filing of forms and their management, etc.) will help or not in this process.
Certainly, some of the defects and shortcomings of this reform - which many specialists have already pointed out - will be revealed and, therefore, I suspect that we will soon see some specific reforms to correct the most serious ones (the first has already been approved in Royal Decree-Law 20/2022, of 27 December 2022).
The key legal issues for 2023:
- Entry into force of the special procedure for micro-enterprises (from January 1st, 2023)
- Regulatory development of the Insolvency Reform: statute of the Insolvency Administration, liquidation portal, etc.
- Foreseeable increase in restructurings and insolvency proceedings due to the economic recession (1st half of 2023)
- Extension of the accounting or corporate moratorium: 2020 and 2021 losses will not be taken into account until the end of 2024.
- Processing of a new Proposal for a Directive on insolvency to harmonize matters such as pre-pack, creditors' committees, etc.
Public and regulatory law
The Civil Service Law for the General State Administration has just been made public. At the same time, the progress of the stabilisation processes for interim staff will increase judicial conflict.
Subsidies and public procurement will be marked by the urgency of an election year. The aim will be to close files at all costs, which will increase conflict.
In terms of ESG, the Due Diligence Directive will impose obligations on companies to monitor their human rights, environmental and good governance impacts.
The key legal issues for 2023:
- Civil Service: The State Civil Service Law and the implementation of the process of consolidation of temporary public employment.
- Public subsidies: urgent completion of the delivery and justification of the implementation of Community subsidies.
- Public procurement: the election year adds budgetary difficulties and the need to exhaust current contracts.
- ESG: obligations on companies in the areas of human rights, environment and good governance.
Banking and finance law
Assessment by José Ramón Couso, partner of the banking and finance department, about key legal issues in 2023:
The national banking sector has continued to grow in strength in 2022 and slightly reduced its NPL ratio despite the uncertainty caused by the invasion of Ukraine, the increase in inflation, the Euribor and the energy crisis.
The new legislative scenario introduced by Law 16/2022 opens up new possibilities in 2023 for bank creditors to reach out-of-court solutions with companies in difficulty to situations of current, imminent and even potential insolvency.
In 2023, banks face the great challenge of making a decisive contribution, in these restructuring processes, to maintaining the business fabric, jobs and avoiding the loss of value resulting from legal proceedings which, to date and in practice, have involved the liquidation of companies.
The role of banks is fundamental in making companies viable, differentiating liquidation situations from specific liquidity situations. On the other hand, legislative adjustments are constant, as evidenced by the recent Royal Decree Law 20/2022, of 28 December, which facilitates the management of negotiation processes by banks, in their capacity as financial creditors in ordinary financing and ICO.
Progress in measures to protect the most vulnerable families has become evident in 2022 with the signing of a new Code of Good Practices by the vast majority of banks, set out in Royal Decree-Law 19/2022, of 22 November, to alleviate the rise in interest rates on mortgage loans on primary residences.
A European regulation that will enter into force in March 2023, EU Regulation 2022/858 of 30 May 2022 on a pilot scheme for market infrastructures based on decentralised registry technology, will lead to a substantial amendment of the Securities Markets Act and the Capital Companies Act.
Finally, one of the challenges that the banking sector will have to continue to take on and lead is the financing of business projects for the European Next Generation funds whose disbursement is still pending.
The key legal issues for 2023:
- Management of novations and adaptations of mortgage operations to the rise in EURIBOR in the face of an increase in delinquency.
- Application of the Code of Good Practices and potential modifications that may be made with sectoral or conventional moratoriums.
- Restructuring plans in "banking pools" with multidisciplinary teams (legal, economic-financial and business strategy) and promotion of the figure of the "restructuring expert".
- Fitting in of corporate operations: capitalization of bank financing, sale of production units, bank participation in the control or business management of accredited companies.
- Development of debt issuance (bonds) with blockchain technology for a future secondary market for tokenized securities.
- Transposition of Directive (EU) 2021/2167 on credit managers and buyers to improve conditions for the sale of bad loans by banks to third parties.
- Implementation of environmental, social and corporate governance or sustainability criteria.
Data protection and digital law
Assessment by Ramón Mesonero-Romanos, partner of the data protection and digital law department, about key legal issues in 2023:
Europe has been developing regulations that favor digital transformation at all levels, proof of which are the regulatory advances in "Digital Services", where measures are increasingly being applied to guarantee the security of online users, without affecting the growth of innovative companies.
All these digital movements mean that more and more data is becoming available, and the trend is clear: to enable greater sharing and re-use of data across sectors and countries, as embodied in the new Data Governance Regulation; as well as fair access to and use of data (Data Regulation).
The key legal issues for 2023:
- Data Governance Regulation 2022/868 will enable greater exchange and re-use of data in the EU.(as of September 24, 2023)
- Digital transformation of the European public sector: Interoperable Europe Act (no date)
- European Digital Identity: identification and authentication through a personal digital wallet stored in the mobile phone (no date)
- A DPD will be required for those entities obliged to have an internal communications system (whistleblowing channel) (no date)
- Digital Services: Digital Services Regulation (as of February 17, 2024) and Digital Markets Regulation (as of May 2, 2023)
- Twelfth edition of the Nice Classification WIPO defines NFTs and places them in international class No. 9.(as of January 1, 2023)
- New competences of the SPTO in nullity and revocation of trademarks in application of Royal Decree-Law 23/2018 (as of January 14, 2023)
Environment and energy law
New circular economy obligations appear for the industrial sector, such as eco-design, marking and labelling obligations, the obligation to organise the separate collection and management of certain waste, such as industrial packaging, through extended producer responsibility systems, or information and notification obligations or registration in the Register of Product Producers.
In addition, on 1 January 2023, the Landfill Waste Tax and the Special Tax on non-reusable plastic packaging, which is levied on the manufacture of single-use packaging, enter into force. Although, throughout 2022, we have pointed out, in various webinars organised for the sector, the tax complexity of the latter tax, in the end its requirement has not been suspended as repeatedly demanded by the affected parties.
The Due Diligence Directive is expected to be approved in 2023, the proposal of which requires certain obligations on large companies in order to control their adverse impacts in terms of human rights, the environment and good governance.
Finally, in relation to energy, key issues such as the detrimental effects that could arise for developers, the expiry, on 25 January, of access and connection permits in the event of non-issuance of environmental declarations, will be key. We will also be keeping an eye on the regulatory regime for hydrogen and the extension of the deadlines for aid to renewable energies until September 2023.
His milestones for the year:
- Circular economy, following the approval, in 2022, of Law 7/2022 on waste and Royal Decree 1055/2022 on packaging and packaging waste, there are many new developments for the industrial sector.
- Environmental taxation, on 1 January 2023 two new environmental taxes will come into force. (as of January 1, 2023)
- Sustainability, we expect important regulatory developments, many of them binding for large companies, in environmental, social and corporate governance (ESG) aspects.
- Energy, given the diversity and breadth of open fronts in this area, we will be watching closely.
Our expert lawyers in each area can help you in your annual planning based on these new trends and regulations, as well as with any other related problems you may have. Feel free to contact us here.