Understanding the CISG is essential for any company or professional involved in cross-border trade, as it may determine the applicable law to their sales contracts and, ultimately, how potential disputes will be resolved.

1. What is the Vienna Convention (CISG)?

The CISG is an international treaty that establishes a uniform set of rules for contracts for the international sale of goods. Its main purpose is to facilitate international trade by providing a common legal framework, thus avoiding the need to determine which national law governs a contract. Currently, over 90 countries are parties to the Convention, including Spain.

2. When does the CISG apply?

The CISG applies automatically to contracts for the sale of goods between parties whose places of business are located in different States that are Contracting States to the Convention. It may also apply when the private international law rules of the forum lead to the application of the law of a Contracting State, even if one of the parties does not have its place of business in a Contracting State. However, some countries have made reservations regarding this basis of application, so its applicability must be assessed on a case-by-case basis.

It is essential to note that the parties may exclude the application of the CISG, in whole or in part, or modify its effects, through an express clause in their contract. If they do not do so, the Convention will apply by default.

3. What matters are governed by the CISG?

The CISG covers the following key aspects of contracts for the international sale of goods:

• Formation of the contract: It governs the offer, acceptance, and the moment the contract is concluded.
• Obligations of the seller: It includes the delivery of the goods, their conformity with the contract, and the obligation to transfer ownership.
• Obligations of the buyer: It encompasses payment of the price and taking delivery of the goods.
• Passing of risk: It determines when the risk of loss or damage to the goods passes from the seller to the buyer.
• Breach of contract and remedies: It establishes the consequences of breach and the parties’ rights, such as avoidance of the contract, damages, or specific performance.

It is important to note that the CISG does not govern the validity of the contract or the effects of the contract on the property in the goods (except for the passing of risk), nor does it regulate liability for death or personal injury caused by the goods. These aspects are governed by the applicable national law.

4. Advantages of applying the CISG

Applying the CISG offers several advantages:

• Uniformity and predictability: It provides a clear and uniform set of rules that reduce legal uncertainty and the costs associated with determining the applicable law.
• Neutrality: As an international treaty, it avoids the application of one party’s domestic law, which can be perceived as more fair and balanced.
• Flexibility: It allows the parties to adapt their contractual terms to their specific needs, provided that they do not contravene the fundamental principles of the Convention.
• Promotion of trade: By simplifying the legal framework, it facilitates international transactions and reduces trade barriers.

5. How does the CISG affect contract drafting?

Since the CISG applies automatically unless expressly excluded, familiarity with it is essential when drafting international sales contracts. Here are some key considerations:

• Exclusion clause: If the parties wish for a specific national law to apply instead of the CISG, they must include a clear and explicit clause in the contract. For example: “This contract shall be governed by Spanish law, with the express exclusion of the United Nations Convention on Contracts for the International Sale of Goods (CISG).”
• Consistency with the CISG: If the parties intend for the CISG to apply, it is advisable that the contractual clauses be compatible with its provisions to avoid contradictions.
• Contracts with non-signatory parties: If one of the parties is located in a country that is not a Contracting State to the CISG, the choice of the applicable law becomes even more relevant.

6. Conclusion

The Vienna Convention (CISG) is a fundamental pillar of international trade, providing a harmonized legal framework that simplifies cross-border transactions. For any company operating internationally, understanding its principles and knowing how it affects sales contracts is crucial to avoid surprises and ensure a smooth and secure commercial operation.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada Vienna Convention (CISG): What is it and how does it affect your international contracts? se publicó primero en Gamero & Bravo Abogados.

Whether we are talking about ad hoc arbitration or institutional arbitration, understanding how this tool works and how to draft it properly is essential to protect our interests.

Let’s take a detailed look at what an arbitration clause is, why it should be included in contracts, what it must contain, and how to draft it properly, using practical examples and references to the ICC Rules, one of the most recognised internationally.

1. What is an arbitration clause?

An arbitration clause, also known as an arbitration agreement, is a provision included in a contract that establishes that any dispute arising between the parties shall be resolved through arbitration, instead of resorting to ordinary courts.

Unlike other methods such as mediation, the decision issued in an arbitration proceeding has binding and enforceable effect on the parties, just as a judicial ruling does.

Thus, this clause defines the parties’ prior agreement to submit to arbitration in the event of a dispute, which means that the parties agree not to bring such disputes before the ordinary courts, except in the legally established cases such as judicial assistance, interim measures, or the challenge of the arbitral award.

2. Types of arbitration: Ad hoc vs. Institutional

There are two main types of arbitration: ad hoc arbitration and institutional arbitration. Both options have advantages and disadvantages, but the important thing is that the arbitration clause clearly specifies which route the parties have chosen.

2.1 Ad hoc arbitration

This type of arbitration is not administered by any specific institution. The parties are responsible for organising the entire procedure, from selecting the arbitrators to establishing the procedural rules.

This form offers greater flexibility and can be more economical, but it also entails certain risks, especially if every procedural aspect has not been properly addressed in the arbitration clause. It is essential for the parties to include supplementary procedural rules (for example, the UNCITRAL Rules), as the absence of an organising entity may lead to delays or disputes on how to proceed if procedural disagreements arise.

2.2 Institutional arbitration

This is managed by a specialised entity, such as the ICC, the Madrid Court of Arbitration, or the International Centre for Settlement of Investment Disputes (ICSID). These institutions have pre-established rules and administrative structures that support the procedure.

Although it may involve slightly higher costs, it offers a guarantee of order, efficiency and professionalism. Furthermore, the institutions act as a neutral support, helping to resolve procedural conflicts.

3. Why include it in my contract?

The main reason to include an arbitration clause in a contract is efficiency. Arbitration can be faster than ordinary court proceedings, and it offers confidentiality—something highly valued in commercial disputes.

Another advantage is specialisation: arbitrators are often experts in the subject matter of the contract, which allows for more in-depth technical analysis in a specific sector than a generalist judge might provide.

Moreover, if the contract has an international dimension, an international arbitration clause helps avoid jurisdictional conflicts between courts of different countries, offering greater legal certainty.

The arbitral award, in turn, is enforceable in most countries thanks to the 1958 New York Convention, which facilitates its enforcement.

4. What should an arbitration clause contain?

A model or well-drafted arbitration clause should contain at least the following elements:

• Clear agreement of the parties to submit to arbitration.
• Type of arbitration: institutional or ad hoc.
• Chosen arbitral institution, if applicable.
• Seat of arbitration, that is, the place where the award will be deemed legally issued and whose procedural law shall govern the procedure (lex arbitri).
• Language of the arbitration.
• Number of arbitrators and method of appointment.
• Procedural rules applicable to the arbitration (especially in ad hoc arbitration).
• Law applicable to the substance of the dispute, either in the arbitration clause or in the main contract. If the lex arbitri differs from the substantive law, it is advisable to expressly establish the law applicable to the arbitration agreement itself, in accordance with the “principle of separability.”

It is important to avoid ambiguities, because a poorly drafted clause can become ineffective and provoke additional disputes. Therefore, each element must be clearly defined.

5. How to draft an arbitration clause?

5.1 Common errors when drafting an arbitration clause

One of the main errors when drafting an arbitration clause is being vague or overly generic. For example, phrases such as “the parties shall submit to arbitration” without defining the scope of the clause may create uncertainty regarding the procedure and, consequently, disputes over how the arbitration should be carried out or what matters are subject to arbitration.

Another common error is failing to designate the seat of arbitration, since the seat determines not only the physical location but, more importantly, the procedural law applicable to the arbitration and the jurisdiction that may review the validity of the final award. Likewise, the language of the arbitration is often omitted, which is crucial, especially in international contracts, to avoid misunderstandings and unforeseen translation costs.

Similarly, failing to define the number of arbitrators or the method of appointment is also a risky omission. For example, in complex disputes, it may be necessary to have a tribunal of three arbitrators instead of a sole arbitrator, and this should be clearly stated.

5.2 When is an arbitration clause invalid?

An arbitration clause may be declared invalid for various reasons. The most obvious is if it breaches public policy provisions or contradicts mandatory rules of the country whose law governs the contract.

It may also be invalid if it lacks essential elements such as the clear consent of the parties, or if the subject matter of the dispute is not arbitrable (e.g., criminal or family matters in many countries).

In addition, a poorly drafted or contradictory clause may generate such a degree of ambiguity that a court could declare it unenforceable.

Another aspect to consider is the compatibility between the arbitration clause and the main contract. However, pursuant to the “principle of separability” recognised in Article 22.1 of the Spanish Arbitration Act, the arbitration clause may survive even if the main contract is declared null and void, unless such nullity also affects the clause itself.

6. Conclusion

The drafting of an arbitration clause in a contract should not be taken lightly, as it is a strategic decision that can significantly impact how future disputes are resolved. If a party wishes to ensure legal certainty, resolve disputes more quickly, and maintain confidentiality and control over the process, including an arbitration clause is essential. It is therefore advisable to seek sound legal advice on arbitration matters to safeguard the interests of a project or contract—especially if international in scope—both now and in the future.

La entrada The Arbitration Clause in Contracts: What Factors to Consider and How to Draft It Correctly se publicó primero en Gamero & Bravo Abogados.

One of the most relevant is the proportional appointment system of directors, provided for in Article 243 of the Ley de Sociedades de Capital (LSC, Spanish Companies Act), whose purpose is to facilitate the representation of minority shareholders on the Board of Directors of Sociedades Anónimas (S.A., public limited companies). In the case of Sociedades Limitadas (S.L., private limited companies), this mechanism does not apply by default and is only possible if it has been expressly agreed in the company’s bylaws.

What is a Board of Directors?

The Board of Directors is a collegiate management and representative body of the company, whose existence must be provided for in the bylaws. It is more common in Sociedades Anónimas, where its regulation is more detailed, whereas in S.L.s simpler forms of management are more frequently used (sole director, joint or several directors).

The members of the board (directors) are appointed by the general meeting of shareholders. In S.A.s, the board itself may also provisionally appoint new directors to fill vacancies through the mechanism of co-option (Art. 244 LSC).

What is the proportional appointment system?

Article 243 LSC grants minority shareholders of an S.A. the right to appoint directors if they group together a number of shares equivalent to the capital required to obtain a seat on the board, according to a proportional formula.

Its operation is as follows:

Shareholders may pool their shares until they reach at least the percentage of the share capital resulting from dividing the total capital by the number of board members. Once this threshold is reached, they are entitled to directly appoint a number of directors proportional to the capital they represent.

Example:

In an S.A. with share capital of 500,000 euros and a board of 10 members, the threshold to appoint one director would be 50,000 euros (500,000 / 10).

A group of shareholders that aggregates that amount may appoint one director. If they reach 100,000 euros, they may appoint two.

The law does not require a minimum number of directors to apply this system, but its practical effectiveness increases in larger boards, where the capital needed to appoint a representative is lower.

This mechanism ensures pluralism in management, allowing minority shareholders to access key information, participate in strategic decisions, and exercise more effective oversight over management.

What rights does a minority shareholder have?

Minority shareholders have a set of rights recognised by the LSC, aimed at balancing power within the company and preventing abuses by the majority shareholder. Among the most relevant:

• Right to information (Arts. 196 and 197 LSC): access to documentation to be submitted to the meeting and, in some cases, to additional information relevant to the company’s management.
• Right to request the convening of a general meeting (Art. 168 LSC): provided they represent at least 5% of the share capital, both in S.L.s and S.A.s.
• Right to request the appointment of an auditor by the Mercantile Registry (Art. 265.2 LSC): when the company is not subject to mandatory audit and a 5% minority requests it.
• Right to bring a corporate liability action (Art. 239 LSC): when directors breach their legal or statutory duties.
• Right to challenge corporate resolutions (Arts. 204 et seq. LSC): when they are contrary to the law, the bylaws or harm the corporate interest in favour of majority shareholders or third parties.

What happens when the minority is blocked?

In practice, it may happen that the minority shareholder, despite these rights, suffers systematic blocking by the majority. Common examples include:

• Unjustified refusal to provide relevant information.
• Repeated exclusion from dividend distribution.
• Difficulties in exercising their right to proportional representation (in S.A.s).
• Adoption of resolutions harmful to the corporate interest.
• Approval of transactions for the exclusive benefit of the majority shareholder.

In such situations, the minority shareholder has legal and corporate actions available to protect their rights. Among others, they may demand judicial access to information, challenge harmful corporate resolutions, bring liability actions against directors, or even judicially claim the recognition of their right to appoint directors under Art. 243 LSC.

Conclusion

The proportional appointment system of directors is an essential instrument to strengthen balance and transparency in the management of Sociedades Anónimas. Although it does not apply automatically to Sociedades Limitadas, it can be provided for in the bylaws to offer minority shareholders an effective avenue of representation. Having a seat on the board not only enables oversight but also strengthens the minority shareholder’s bargaining power in strategic decisions. Acting with knowledge and professional support is key to enforcing these rights and avoiding internal conflicts escalating into litigation that is difficult to reverse.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada Board of Directors: How does the proportional appointment system of directors for minority shareholders work? se publicó primero en Gamero & Bravo Abogados.

What is an appeal before the CAS?

The CAS may act as an appellate tribunal for decisions issued by sports federations, leagues, Olympic committees, or other sporting bodies. In these cases, parties may file an appeal in accordance with the CAS Code of Sports-related Arbitration, within 21 days of receiving the reasoned decision.

Such appeals aim to review the legality of the decision, its consistency with applicable regulations, and compliance with due process. Appeals may involve misapplication of sports rules, errors in evidentiary assessment, or procedural violations.

Who can appeal?

Any party affected by a sporting decision that recognises CAS jurisdiction may file an appeal, including:

• Athletes sanctioned for doping or disciplinary offences;
• Clubs subject to sporting or contractual sanctions;
• Federations contesting decisions by international or supranational bodies;
• National Olympic Committees;
• Licensed agents or representatives with standing to appeal.

CAS appeal procedure

The appeal process involves several stages:

1. Notice of appeal: Filed within 21 days, identifying the parties, the contested decision, and the scope of the appeal.
2. Appeal brief: A formal submission detailing the legal grounds and evidence.
3. Appointment of arbitrators: According to the CAS Code.
4. Oral hearing or written proceedings: Depending on the complexity of the case.

Costs of the procedure

Proceedings before the CAS may be:

• Free of charge in certain cases (e.g. amateur doping matters), pursuant to Article R65 of the CAS Code;
• Standard proceedings, with a CHF 1,000 filing fee, plus arbitrators’ fees, legal representation, and procedural costs.

Estimated duration

In general, a CAS appeal is resolved within 90 to 180 days. Expedited procedures are available for urgent cases, such as during ongoing competitions.

Appeals against CAS awards: Review by the Swiss Federal Tribunal

In principle, CAS awards are final. However, under Article 190(2) of the Swiss Private International Law Act, it is possible to file a motion to set aside the award before the Swiss Federal Tribunal. This is not an appeal on the merits, but a review limited to fundamental procedural guarantees:

• Improper constitution of the arbitral tribunal;
• Lack of jurisdiction;
• Decision beyond the scope of the request for relief;
• Violation of the right to be heard;
• Incompatibility with Swiss public policy.

Such grounds must be raised within 30 days from the notification of the award.

Conclusion

Filing an appeal before the CAS or seeking to set aside one of its awards is a highly specialised process. Understanding the applicable time limits, legal grounds, and procedural requirements is key to maximising the chances of success. Expert legal representation in international sports arbitration is essential in these situations.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada CAS: How to Appeal a Decision Before the CAS and When It Is Possible se publicó primero en Gamero & Bravo Abogados.

Many business owners are unaware that paying a director’s salary without following this procedure may be treated as a non-deductible gratuitous payment, with significant financial and legal consequences.

The question of how much a director should earn must also be addressed from a legal and market-based perspective. It is not merely about assigning a number, but about justifying the amount based on the level of responsibility, the size of the company, and alignment with market standards, always within the limits approved by the general meeting. It is also essential to apply the correct income tax withholding to avoid problems with the tax authority and ensure the process is legally sound.

What does a company director do?

A company director is responsible for the management and legal representation of the business. This includes signing contracts, representing the company before public authorities, and ensuring full legal compliance. The director plays a central role in guiding the strategic direction of the company and overseeing its daily operations.

This position entails not only leadership but also significant legal and financial liability. In cases of mismanagement or legal breaches, the director’s personal assets may be at risk. The position may be unpaid or remunerated, but if the remunerated nature of the role is not expressly set out in the company’s articles, any payment will be invalid under commercial law and non-deductible for tax purposes.

Types of governance structures in a private limited company

A private limited company in Spain may be managed under various governance models:

• Sole director: One person holds all management and decision-making powers. This is the most common model for small businesses.
• Joint and several directors: Two or more directors may each act independently on behalf of the company.
• Joint directors (acting jointly): Two or more directors must act together to bind the company, increasing internal control but slowing down operations.
• Board of directors: A collegiate body with at least three members, which makes decisions by majority and may delegate executive functions to one or more managing directors.

Each model has different implications for decision-making and director remuneration, which must always comply with the articles of association and resolutions of the general meeting.

How much does a director earn?

There is no standard answer. The director’s remuneration depends on the company’s size, the scope of responsibilities, the time commitment required, and — most importantly — what is provided in the articles and approved by the shareholders.

The amount must be reasonable and proportionate to the responsibilities and the company’s financial situation.

Special attention must be given to retired directors. In general, receiving remuneration for an active directorship is incompatible with claiming a retirement pension, except in limited situations such as “active retirement.” A prior legal analysis is essential to avoid losing pension entitlements or incurring penalties.

How should director remuneration be structured?

This is one of the most complex and error-prone areas. Director remuneration is not a matter of free choice; it is subject to legal and judicial requirements.

1. The “link theory”: always a commercial relationship

When a person is appointed as a company director, their relationship with the company is legally considered commercial, not employment-based. If the same person also performs executive or managerial functions, Spanish case law (the “link theory”) considers that the commercial relationship overrides and absorbs any employment relationship.

Practical effect: All payments received, whether for directorship or management functions, are treated as director remuneration and must follow commercial law requirements. It is not legally valid to receive a salary under an employment contract for managerial duties while also being paid separately as a director.

2. Tax and social security treatment

• Income tax (IRPF): The director’s remuneration is subject to a flat-rate withholding: generally 35%, or 19% for companies with a turnover under €100,000 in the previous year.
• Social security: A director who exercises effective control and management of the company (often through shareholding) must be registered under the self-employed social security regime.
• No invoicing allowed: A director cannot invoice the company for their management or executive services. This practice is considered irregular by the tax authorities.

Articles of association and legal requirements

Two key conditions must be met for director remuneration to be valid and tax-deductible:

• Articles provision: The articles of association must clearly state that the role is remunerated and specify the method of remuneration. Generic or vague clauses are not sufficient.
• Shareholder approval: The general meeting must approve, each year, the maximum total amount that the company may pay to its directors. Without this resolution, any payment may be classified as a non-deductible gratuitous benefit.

How to check if someone is a company director

The official way to confirm whether a person is a registered director is to request a company extract from the Companies Registry in the province where the company is domiciled. For the appointment to have legal effect against third parties, it must be properly registered.

The appointment should also appear in the company’s incorporation deed or in the minutes of a shareholders’ meeting. This is especially important since, as noted above, directors can face personal and even unlimited liability in certain situations.

Conclusion

Director remuneration is a key element of corporate governance. Ensuring transparency, strict compliance with the company’s articles and shareholder resolutions, and proper structuring under commercial law is critical — not only for legal and tax validity, but also for the company’s financial integrity and professional standards.

In today’s increasingly regulated environment, it is essential to understand the applicable tax and social security rules, as well as the personal liability directors may face. Early legal advice is the best way to avoid penalties, protect the director, and strengthen the legal and financial health of the company.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada Director’s Remuneration in a Spanish Private Limited Company se publicó primero en Gamero & Bravo Abogados.

This article examines how foreign judgments and arbitral awards are recognised and enforced in Spain, distinguishing between arbitral awards, judgments from EU Member States, and those from third countries.

What is an arbitral award and how is it enforced in Spain?

An arbitral award is the decision that concludes an arbitration proceeding, rendered by one or more arbitrators appointed by the parties. According to Article 43 of the Spanish Arbitration Act (Law 60/2003, of 23 December), final awards have the same enforceability as a final court judgment.

Enforcement of domestic arbitral awards

If the award was issued in Spain, it is enforced under the rules established in the Spanish Civil Procedure Act (Ley de Enjuiciamiento Civil, or “LEC”). The enforcement process begins before the Court of First Instance of the place where the award is to produce legal effects, through the filing of an enforcement petition accompanied by the original or an authenticated copy of the award.

Enforcement of foreign arbitral awards: the exequatur process

To enforce an arbitral award issued outside Spain, prior judicial recognition is mandatory through the exequatur procedure, governed by:

• The 1958 New York Convention.
• Article 46 of the Spanish Arbitration Act.
• Supplementarily, the Spanish Civil Procedure Act.

Phase 1: Recognition (Exequatur)

Recognition must be requested before the Civil and Criminal Chamber of the High Court of Justice (Tribunal Superior de Justicia, or TSJ) of the Autonomous Community where the award is to take effect (Article 8.6 of the Arbitration Act).

Phase 2: Enforcement

Once recognised, the award may be enforced before the competent Court of First Instance (Article 545.3 LEC), as if it were a judgment rendered by a Spanish court.

What is the exequatur?

The exequatur is the judicial procedure by which Spain recognises the legal effectiveness of decisions issued by foreign courts or arbitral tribunals. Its purpose is to ensure that such decisions respect public policy, reciprocity, and fundamental rights, in accordance with the requirements of the Spanish legal system.

How are foreign court judgments recognised and enforced in Spain?

The applicable procedure depends on whether the judgment originates from an EU Member State or a third country.

Judgments from EU Member States

Regulation (EU) No. 1215/2012 (Brussels I bis) abolished the exequatur requirement between EU Member States. Judgments from other EU countries are automatically recognised and can be directly enforced in Spain as if they were national judgments.

Judgments from non-EU countries

In these cases, the exequatur procedure is required under Law 29/2015, on international legal cooperation in civil matters, unless a bilateral treaty exists that exempts the judgment from this requirement.

Who is responsible for handling the exequatur procedure?

How long does the process take?

The duration of the procedure depends on:

• Whether an exequatur is required.
• Whether there is opposition.
• The workload of the competent court.

Estimated average: between 6 months and 1 year for the exequatur. Enforcement thereafter is usually processed more swiftly.

Conclusion

Both foreign arbitral awards and court judgments can be enforced in Spain, provided that the appropriate legal procedures are followed. Proper identification of the applicable regime (direct enforcement or via exequatur), thorough preparation of the required documentation, and the involvement of experienced legal professionals are essential to ensure the enforceability of foreign decisions within Spanish jurisdiction.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada How to Enforce an Arbitral Award or a Foreign Judgment in Spain se publicó primero en Gamero & Bravo Abogados.

Nevertheless, its exercise is regulated by law to ensure it is used legitimately and not abusively, thereby also safeguarding the corporate interest.

Below, we analyse the scope of this right, its legal framework under the Spanish Companies Act (Ley de Sociedades de Capital, “LSC”), and the circumstances under which it may be restricted or exempted.

What Is the Shareholder’s Right to Information?

The right to information is an essential entitlement recognised by law, enabling shareholders to access certain information regarding the operation of the company in which they hold an interest. Its legal basis lies in Article 93(d) of the LSC, which includes it among the core rights of shareholders.

Although Article 93 LSC enshrines this right, its specific content, scope, and the manner and timing of its exercise are governed by other provisions of the Law, mainly those relating to the calling and holding of general meetings (Articles 196 and 197 LSC) and the right to examine documentation concerning the annual accounts (Article 272 LSC). It is therefore not an abstract right to request any information at any time.

This right is particularly significant for minority shareholders, as it provides a tool for overseeing management and ensuring that directors act diligently and loyally, in accordance with the law and the company’s articles of association.

What Is the Legal Framework for the Right to Information at the General Meeting?

The primary regulation of the right to information in the context of general meetings is found in Articles 196 and 197 of the LSC, with differences depending on the type of company:

• Article 196 LSC (Private Limited Companies – S.L.):

“Shareholders may request in writing prior to the meeting, or orally during the meeting, such reports or clarifications as they deem necessary regarding items included on the agenda.

The administrative body is required to provide the information, unless, in its judgement, disclosure of such information could be detrimental to the company’s interests (this exception does not apply if the request is supported by shareholders representing at least 25% of the share capital).”

• Article 197 LSC (Public Limited Companies – S.A.):

“Shareholders may request information or clarifications regarding items on the agenda, or submit written questions in advance: up to the seventh day prior to the scheduled date of the meeting. The directors must respond in writing by the date of the meeting.

During the meeting, shareholders may orally request information or clarifications regarding the same matters. If it is not possible to respond at that time, the directors must do so in writing within seven days following the conclusion of the meeting.

Refusal to provide information is more restricted in S.A.s: it is only permitted if the information is unnecessary for the protection of the shareholder’s rights, if there are objective reasons to believe it could be used for purposes unrelated to the company, or if its disclosure could harm the company or its affiliates (Article 197.3 LSC). Refusal is not permitted if the request is supported by shareholders holding at least 25% of the capital (or the lower percentage set by the articles, with a minimum of 5%).”

It should be noted that the LSC does not recognise a general right to inspect documents in S.A.s similar to that which may exist in S.L.s under certain conditions (Article 272.3 LSC regarding supporting documents for the annual accounts).

When Can the Right to Information Be Exercised?

The right to information is mainly exercised in the following legally established contexts:

• Before and during General Meetings: As detailed above, shareholders may request information and clarifications on specific agenda items, in accordance with Articles 196 and 197 LSC.
• Approval of Annual Accounts: Article 272 LSC grants any shareholder the right to obtain, free of charge and immediately from the time of the meeting notice, the documents submitted for approval (accounts, management report, audit report if applicable). In addition, in S.L.s, shareholders holding at least 5% of the capital may examine supporting documentation for the accounts at the company’s registered office.
• Other cases: Outside these scenarios, access to specific information or documentation (e.g. detailed accounting, specific contracts, etc.) is not automatic. If a shareholder believes they require further information, for instance in the event of well-founded suspicions of irregularities or to assess specific transactions, they must request it from the administrative body. If the board refuses (arguing, for example, detriment to the corporate interest or lack of standing), the shareholder may seek judicial relief to assess the appropriateness of the request, provided they can demonstrate a legitimate interest and the relevance of the information.
• The specific right to request an audit (Article 265.2 LSC): It is important not to confuse the right to information with the right granted to shareholders holding at least 5% of the share capital in companies not required to have their accounts audited. These shareholders may request the Commercial Registrar of the registered office to appoint an auditor to review the accounts for a specific financial year, provided no more than three months have elapsed since the financial year-end. This is a specific and independent action, distinct from the general right to information.

When Is the Exercise of the Right to Information Considered Abusive?

The exercise of the right to information is limited by the corporate interest and the principle of good faith. It is considered abusive when a shareholder uses it for purposes other than those provided by law, such as:

• Making repeated, excessive or indiscriminate requests with the aim of obstructing management;
• Seeking access to sensitive information (industrial secrets, commercial strategies) for purposes unrelated to the company, such as providing it to competitors;
• Using the right as a tool for coercion or blackmail against management or other shareholders.

In such cases, the board may refuse the requested information, providing justification based on the protection of the corporate interest (Articles 196.2 and 197.3 LSC). The burden of proof for the abusive nature of the request or the harm to the corporate interest lies with the board if the shareholder challenges the refusal. Whether abuse has occurred is a matter of judicial assessment and depends on the specific circumstances.

Considerations Regarding Related-Party Transactions and the Duty of Loyalty

At times, the right to information is exercised to monitor transactions that may involve conflicts of interest, such as a transaction between the company and one of its directors. In such cases, beyond the shareholder’s right to information, specific rules come into play, such as:

• The directors’ duty of loyalty (Articles 227 et seq. LSC), which requires them to prioritise the corporate interest over their own;
• The prohibition on participating in the deliberation and voting of resolutions in which a conflict of interest exists (Article 228.c LSC);
• The rules governing related-party transactions, which are particularly stringent in listed companies (Article 529 vicies et seq. LSC).

The right to information allows shareholders to obtain data to verify that such transactions are conducted on arm’s length terms and in compliance with directors’ fiduciary duties.

Conclusion

The right to information is an essential tool for shareholders, but its exercise is defined and limited by the Spanish Companies Act. It is crucial to understand the procedures, timing, and limits established in Articles 196, 197 and 272 LSC to exercise it legitimately and effectively, and to distinguish it from other mechanisms such as the request for an audit under Article 265.2 LSC.

In case of doubts about its scope or if the company refuses to provide information, it is advisable to seek specialised legal advice in Madrid to assess the appropriate course of action.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada The Shareholder’s Right to Information Under Spanish Law: Scope, Limitations, and Legitimate Exercise se publicó primero en Gamero & Bravo Abogados.

Today, we explore how CAS’s ordinary and appeal procedures function, providing a practical guide for sports entities and legal professionals working in this field.

What is the Court of Arbitration for Sport (CAS)?

CAS was established to ensure a dispute resolution system tailored to the sports sector, with a focus on neutrality, speed, and efficiency. It has jurisdiction over contractual and disciplinary disputes involving federations, clubs, athletes, coaches, and agents.

This tribunal has become the preferred conflict resolution mechanism for most international sports federations, including FIFA, the International Olympic Committee (IOC), and other regulatory bodies. This is due to its ability to deliver specialized and binding decisions in the context of sports-related disputes, ensuring an efficient process separate from national courts.

Awards issued by CAS are final, binding, and internationally recognized under the 1958 New York Convention, which ensures their enforceability in over 170 countries.

CAS Proceedings

CAS regulations establish two main procedures:

1. Ordinary Procedure

This mechanism is designed to resolve contractual or commercial disputes within the sports sector, such as conflicts between clubs and players, sponsors, or broadcasting rights.

Key characteristics of the ordinary procedure:

• Initiation: The parties must have an arbitration agreement designating CAS as the competent forum.
• Filing of the Arbitration Request: The process begins with a request detailing the parties, facts, and claims.
• Tribunal Composition: The case is heard by one or three arbitrators selected from CAS’s official list.
• Hearing: Both parties can present evidence, witnesses, and arguments.
• Final Award: Typically issued within six months, the decision is binding and enforceable internationally.

2. Appeal Procedure

Used to challenge disciplinary or administrative decisions made by international and national sports federations.

Key aspects of the appeal procedure:

• Filing Deadline: Appeals must generally be submitted within 21 days of receiving the decision being challenged.
• Case Presentation: The appellant must specify the grounds for the challenge and provide relevant evidence.
• Resolution: After an exchange of written submissions and a hearing, CAS issues an award within a short period, typically within three months of the hearing.

Advantages of Submitting Disputes to CAS

CAS has established itself as the best option for resolving sports disputes due to the following advantages:

• Neutrality: It provides an impartial forum free from potential influences of national jurisdictions.
• Speed: Procedural timelines are designed to ensure timely decisions.
• Expertise: Arbitrators are specialists in sports and commercial law.
• Confidentiality: Proceedings protect the privacy of the parties unless otherwise agreed.
• Global Enforceability: CAS awards are recognized in jurisdictions worldwide.
• FIFA and IOC Recognition: The main sports organizations rely on CAS for conflict resolution, reinforcing its authority and prestige.

Conclusion

The Court of Arbitration for Sport is a fundamental pillar for the resolution of sports disputes globally. Its specialized structure and procedures tailored to the sports context make it a reference model in international arbitration. For clubs, federations, and athletes, understanding how CAS operates is essential to safeguarding their interests and ensuring fair and enforceable decisions.

If you need legal advice or representation before CAS, we recommend consulting a specialized legal team in CAS procedures in Madrid to ensure a strong and effective defense before this international sports arbitration tribunal.

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada CAs or Court of Arbitration for Sport: A Key Institution in International Sports Dispute Resolution se publicó primero en Gamero & Bravo Abogados.

What is a Memorandum of Understanding?

A Memorandum of Understanding, also known as an MOU, is a formal agreement between two or more parties outlining mutual intentions to collaborate on a project or initiative. Although generally not a fully binding contract, it can include clauses that create specific legal obligations, such as those related to confidentiality, exclusivity, or dispute resolution. The MOU sets forth the general terms and objectives of the collaboration, serving as a guide for future formal negotiations.

When Should Memorandums of Understanding Be Used?

An MOU is utilized in situations where:

• There is a desire to define a preliminary relationship between the parties without the obligation of a complete binding contract.
• It is necessary to define basic expectations and responsibilities, such as in collaborative projects between companies or joint research agreements.
• The aim is to establish a foundation for future negotiations, allowing the parties to assess the project’s feasibility before formally committing.

Example: A university and a company may use an MOU to define the scope of a joint research project before signing a more detailed contract.

Advantages and Disadvantages of a Memorandum of Understanding

Advantages:

• Initial Clarity: Allows all parties to understand expectations without fully committing to the project.
• Facilitates Negotiation: Serves as a reference framework for future discussions.
• Flexibility: Since the parties may agree to not make it fully binding, it can adapt to the project’s changing needs.

Disadvantages:

• Not Always Binding: Parties may decide not to proceed without significant legal repercussions, unless clauses that create enforceable obligations, such as confidentiality or exclusivity, have been included.
• Ambiguity: If not drafted correctly, it can lead to misunderstandings about responsibilities.
• Less Legal Weight: Provides less security compared to a complete contract if a party fails to comply with the agreement.

Differences Between a Memorandum of Understanding and a Memorandum of Agreement

The Memorandum of Understanding (MOU) is often confused with the Memorandum of Agreement (MOA). Although both documents are similar, they have key differences:

The MOA is more common when the parties have reached an advanced level of negotiation and are ready to detail binding terms. The essential difference lies in that an MOU focuses on establishing a general intention without broad commitments, while an MOA can include detailed terms that the parties consider binding.

How to Draft a Memorandum of Understanding

To draft an effective Memorandum of Understanding, it is essential to follow a clear structure covering the agreement’s basic aspects:

1. Heading: Include the title “Memorandum of Understanding” and the parties involved.
2. Introduction: Describe the purpose of the MOU and the nature of the agreement.
3. Terms of the Agreement: Detail each party’s responsibilities, roles, and obligations.
4. Duration: Specify the MOU’s term and the conditions for its termination.
5. Additional Clauses: Include sections on confidentiality, dispute resolution, and future revisions.
6. Signatures: Ensure that the form of signature (handwritten, digital, or scanned) is valid according to the applicable law to avoid issues of validity or enforceability.

When Should MOUs Be Used in International Projects?

An MOU is particularly valuable in international projects where:

• Cultural and Legal Differences Exist: An MOU helps define clear expectations and mitigate potential cultural or legal misunderstandings, especially in jurisdictions with different legal systems.
• An Initial Evaluation Stage Is Needed: Before signing an international contract, the MOU allows parties to explore collaboration without formal legal commitments.
• Strategic Collaborations Are Established: Such as partnerships between companies from different countries where a mutual understanding is needed.

Example: A U.S. company and a European company might use an MOU to agree on the general terms of a business alliance before signing a definitive contract.

Conclusion

The Memorandum of Understanding (MOU) is a flexible and useful tool for establishing collaborations in various fields, such as joint research, strategic partnerships, or exploring new business opportunities. Although not always a fully legally binding contract, it can include specific obligations, such as confidentiality or exclusivity. It helps clarify expectations, define roles, and lay a solid foundation for future negotiations

ABOUT GAMERO & BRAVO ABOGADOS

Gamero & Bravo Abogados is a firm specializing in commercial law, commercial litigation, and arbitration, focusing exclusively on advising businesses. We offer strategic legal solutions tailored to sectors such as construction, real estate, finance, sports industry, and logistics, both in Spain and in international projects.

If you want to learn more about our services or need personalized legal advice, feel free to contact us at info@gamerobravo.com.

NEED HELP?

At Gamero & Bravo Abogados, we have a team of experts in resolving commercial disputes, designing complex contracts, and representing clients in international arbitrations. Write to us, and we will be happy to assist you.

La entrada Memorandum of Understanding: What is it? How are they drafted? se publicó primero en Gamero & Bravo Abogados.

In an increasingly globalized world, international expansion is a strategic necessity for many companies seeking to capitalize on new business opportunities in foreign markets. However, this process is not without its risks and challenges, particularly when it comes to resolving contractual disputes. The differences in legal, cultural, and economic systems between countries can significantly complicate the protection of commercial interests abroad. In this context, international arbitration emerges as an indispensable tool for investment protection and ensure legal stability in cross-border commercial transactions.

What is International Arbitration?

International arbitration is an alternative dispute resolution mechanism designed to avoid going to court. Instead of submitting their disputes to the jurisdiction of a national court, the parties to an international transaction agree to resolve their disputes through arbitration, in which one or more independent and neutral arbitrators make a final and binding decision, known as an arbitral award.

Unlike other systems like mediation, it is important to clarify that the arbitrator’s decision is binding and has the same effect that a court judgment, which can be enforced coercively.

One of the main advantages of international arbitration is the neutrality of the forum. Unlike litigation in national courts, where one party might perceive bias in favor of the national counterpart, arbitration allows the parties to select a neutral tribunal. This neutrality is particularly valuable in international contracts, where differences in legal systems, languages, and regulatory frameworks can create uncertainty.

Moreover, international arbitration is supported by a robust and recognized legal framework, such as the 1958 New York Convention, which facilitates the enforcement of arbitral awards in over 160 countries, providing legal certainty rarely found in national courts.

The Arbitration Agreement: The Cornerstone of the Process

The success of international arbitration largely depends on the strength and clarity of the arbitration agreement that the parties establish. This agreement, which can be included in a clause within the main contract or in a separate agreement, sets the foundation for how disputes will be resolved.

A well-drafted arbitration agreement is essential to ensure an efficient and fair process. Below are some of the most important elements that should be included in an arbitration agreement:

• Scope of Arbitration: It is crucial to clearly define the disputes that will be subject to arbitration. A clear scope of the arbitration agreement avoids ambiguities regarding its applicability to certain disputes.
• Number of Arbitrators and Selection Process: The parties must decide whether the arbitration will be conducted by a sole arbitrator or by a tribunal of three arbitrators. It may also be advisable to agree on a fair and transparent selection process, although this may be unnecessary if an arbitration rule is chosen that addresses this issue.
• Seat of Arbitration: The seat of arbitration determines the applicable procedural law and affects the ease with which the arbitral award can be enforced. It is crucial to choose a jurisdiction with a solid reputation for supporting arbitration that is neutral to both parties.
• Applicable Rules: The parties must specify the procedural rules that will govern the arbitration, whether those of a recognized institution or a set of ad hoc rules. Most reputable arbitration institutions have arbitration rules that facilitate the conduct of the proceedings for both the parties and the arbitrators.
• Language of Arbitration: It is important to agree on the language in which the arbitration will be conducted, as this can have a significant impact on the costs and accessibility of the process.
• Governing Law: The parties must agree on the substantive law that will govern the dispute, which can be the law of one of the countries of the parties involved or a neutral law.
• Confidentiality: Arbitration allows the parties to maintain the confidentiality of the process and the final decision, which should be guaranteed in a specific clause in the arbitration agreement. Most arbitration rules also establish the confidentiality of the arbitration.

The Arbitration Procedure and the Award

Once the arbitration process is triggered, it follows a series of steps designed to ensure a fair and efficient resolution.

• Commencement of the Procedure: The arbitration formally begins when a party files a request with the arbitration institution or directly with the designated arbitrator.
• Constitution of the Arbitral Tribunal: Arbitrators are selected according to the terms of the arbitration agreement, ensuring that they possess the necessary experience and neutrality.
• Exchange of Written Submissions: The parties present their cases in writing, setting out their legal arguments and documentary evidence.
• Oral Hearing: In many arbitrations, a hearing is held where the parties present oral arguments, examine witnesses, and submit evidence.
• Deliberation and Arbitral Award: After the hearing, the arbitral tribunal deliberates and issues the arbitral award, which is the final and binding resolution of the dispute. The award, in most cases, cannot be appealed, except in exceptional situations.
• Enforcement of the Award: One of the advantages of international arbitration is the ease of enforcing the award, guaranteed by the New York Convention, which allows it to be enforced in nearly any country in the world.

Conclusion

International arbitration is an essential mechanism for companies seeking to expand globally and protect their investments in jurisdictions outside their home base. It offers a neutral and efficient forum for resolving disputes, backed by a solid legal framework that provides legal certainty in a complex global environment. To maximize the benefits of international arbitration, it is crucial to have a well-structured arbitration agreement that addresses all relevant aspects. With the right legal advice, companies can ensure that their interests are protected and that any disputes are resolved fairly and efficiently in their international operations.”

La entrada International Arbitration: key to protecting and expanding business globally se publicó primero en Gamero & Bravo Abogados.