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Following the recent approval of the Act 7/2023 of 28th of March, on the protection of animal rights and welfare which entered into force on 29th of September 2023, the legislator has established a legal framework which aims to guarantee the protection and welfare of animals in Spain.

Within the set of rights recognised for animals, a relatively unknown precept has been introduced, which will undoubtedly have a major impact at the social level, especially in a society like Spain where 1 in 3 families have a dog in their homes.

We specifically discuss the inclusion of article 30.3 of the regulatory text; this specific article stipulates: “In the case of dog ownership and throughout the animal’s entire life, the owner must contract and maintain in force civil liability insurance for damages to third parties, whose coverage includes the persons responsible for the animal, for an amount sufficient to defray any possible derived expenses.”

What repercussion shall the entry into force of article 30.3 of Act 7/2023 of 28th of March have?

First of all, it entails the requirement to contract mandatory civil liability insurance that covers damages and injuries that dogs may cause to third parties starting from 29th of September 2023. At this point, the legislator did not want to include the damages that could be caused by other pets, for example, cats, in the mandatory insurance.

Secondly, the civil liability policy must be specific for the dog, namely, the policy terms and conditions must specify the dog to be insured.

Regarding the individuals who own more than one dog, in principle, nothing prevents them from taking out a single policy for more than one dog, as long as each of the animals is included separately and differentiated within the object of insurance.

Third, the policy coverage must have a sufficient amount in order to defray any damages that the animal may cause. Regarding this point, the legislation does not clearly stipulate what should be understood as sufficient, where the usual practice in these insurance policies is a civil liability coverage that ranges between €120,000 and €150,000.

In any case, it should be noted that numerous municipalities in our country have ordinances that include the minimum amounts that civil liability policies must cover, especially in the category of potentially dangerous dogs.

Who must contract the civil liability insurance policy?

The law is very clear about this point and it stipulates that the person who holds the registry ownership of the dog must be the same person who is the policyholder, namely, the individual who owns the dog and the subscriber of the insurance policy must be concentrated in the same person.

Does my home insurance policy cover the damages that may be caused by my dog?

No, the home insurance policy does not cover the civil liability caused by dogs; it is necessary to contract a specific insurance policy which identifies the dog and its owner.

Consequently, starting from 29th of September, the coverage of home insurance policy for the damages caused by dogs to third parties shall cease to be valid, necessarily requiring the contracting of a specific civil liability insurance policy which complies with the requirements stipulated by law.

It should be noted that as long as the home insurance policy complies with the requirements stipulated by the new law, it shall be fully valid; however today, the majority of insurance policies do not comply with the legal requirements in relation to the insurance for dogs. which requires, as we have mentioned, a specific policy.

What happens if I have a dog administratively classified as potentially dangerous?

The specific article of the new law does not differentiate between categories of dogs; the legislator clearly has the intention to insure the civil liability that can be caused by any type of dog, without differentiating between dangerous and non-dangerous dogs.

The exclusions that undermine the possible application of the insurance policy in cases of damage caused by dangerous breeds shall not be admitted. It is expected that insurance companies shall increase the premiums in the cases where they intend to insure this category of dogs, where they may not exclude their coverage in any case.

Conclusions

1. Starting from 29th of September, there is a stipulated obligation to contract mandatory insurance which covers the civil liability for damages that dogs may cause to third parties.
2. The home insurance policy does not cover the civil liability of dogs; whereby it is necessary to contract a specific insurance policy.
3. The civil liability insurance policy must identify the dog and its owner, where said owner is obliged to subscribe the policy.
4. The policy must have sufficient coverage to defray the damages caused to third parties.
5. The insurance policy coverage must cover dogs administratively classified as dangerous and non-dangerous, where limiting clauses cannot be included that exclude coverage due to the dog’s category.

On 1st of January, the Royal Decree-Act 20/2022, of 27th of December entered into force with measures in response to the economic and social consequences of the Ukraine war and to support the reconstruction of the island of La Palma and other vulnerability situations; which among others, adopted a series of measures in relation to housing leases.

1. Extension of the limitation to update rent.

Since the Spanish Consumer Price Index (IPC) continues to have a high percentage and this figure is used as the benchmark index to update, among others, rent agreements; the limitation on the annual update of rent in the housing lease contracts has been extended up to 31st of December 2023, subject to the Urban Leases Act whose rent must be updated because this complies with the respective annual term of the contract in force. Hence, this update cannot exceed the annual variation of the General Competitiveness Index, which at the date of this update, currently has a maximum value of 2%.

Bear in mind that this limitation does not affect the rent updates in the leasing of real estate properties for uses other than housing, where the principle of freedom of agreement between the parties prevails.

2. Extension of the suspension of eviction proceedings and evictions for vulnerable households without housing alternatives.

Since the entry into force of the Royal Decree-Act until the date of 30th of June 2023, when a landlord seeks the eviction of a tenant due to payment default or expiration of the contractual period, always when the tenant is renting a house subject to the Urban Leases Act, the latter may request an extraordinary suspension of the eviction on the grounds that said party is in a situation of economic vulnerability that makes it impossible for this party to find alternative housing for himself/herself and for the persons with whom said party lives.

This suspension shall also apply in the cases in which the recovery of a squatted house is sought, always when said house belongs to a legal entity or an individual who is the owner of more than ten houses and that the person who is squatting in the house is a dependent person in accordance with Act 39/2006, of 14th of December, a victim of violence on women or has a dependent or a minor person in said party’s care, coexisting in the same house.

The requirements that the tenant or squatter must comply with in order to assess the alleged vulnerability are stipulated in Royal Decree-Act 11/2020, of 31st of March, as well as the documentation that must be submitted to prove such vulnerability.

3. Extraordinary extension of the habitual house lease contracts.

In the habitual house lease contracts subject to the Urban Leases Act, in which, within the period comprised from the entry into force of the Royal Decree-Law until 30th of June 2023, the mandatory or tacit extension period concludes; at the tenant’s request, an extraordinary extension for the rental contract period of six months from the termination date must be applied, during which the terms and conditions established for the contract in force shall continue to apply.

As it can be seen, these are all measures aimed at protecting the tenant and are in line with those that have been adopted since the outset of the pandemic caused by Covid-19.

1. The importance of the family business

We must start from the fact that almost 90% of the Spanish business sector is comprised by companies with a large family component, which means, companies in which one or more founding families have control of the company through a significant shareholding in its capital and through the adoption of strategic business decisions (hereinafter, the “Family Business”).

Likewise, the importance of these types of companies in the creation of private jobs and GDP are characterised by their vocation of continuity and the family’s will to transfer the business in future negotiations.

In consideration of this data and the need to improve the planning adapted to the unique circumstances of each company and thus prevent the disappearance at the time of succession to future generations, the preparation and execution of a family protocol is essential to regulate the personal and family relationships of the members of the family business and thus achieve a continuous and stable perseverance over time.

2. What does the Family Protocol consist of?

The Family Protocol is a document subscribed by the members of the family with direct or indirect interests in the Family Business. This means, it can be subscribed from the founder of the Family Firm up to the spouse of one of the descendants who is not involved in the management of the Company.

This protocol configures the directives and principles that shall stipulate the internal operation of the Family Business in question which the members of the family must respect and obey.

It is considered to be the best tool to stipulate the proceeding that will eventually govern the generational handover and the continuity of the business, thus avoiding (or at least minimising) potential conflicts between family members at the most crucial moments of the evolution.

As we have indicated, it is a heterogeneous document with a far-reaching scope, hence the determination of which family members should sign the Family Protocol will depend on the structure of the family in question; thus, it is common that, in addition to the direct shareholders of the company, their spouses and descendants also endorse the document.

We must highlight that the Family Protocol may become outdated and redundant if it is not considered as a dynamic document and therefore, it is periodically reviewed to adapt it to the changing reality of the Family Business and the new approach of the future generations.

3. Preparation and content of the Family Protocol

The Family Protocol is designed as the essential document in the management of the relationships among the Family members and with the Business. It makes it possible to anticipate future conflicts that could arise within the company and the family itself, as well as facilitating the intergenerational change.

In the Family Protocol, the Family members can regulate diverse issues such as tax planning for family members, the Company financing based on family resources or conversely, the financing of family members based on the business resources, the protection of the rights of spouses and the preparation of succession. This means numerous issues and topics can be covered in the Family Protocol.

Exhaustive analysis work must be previously done for the proper preparation of a Family Protocol. The particular details of each Family Business and the specific needs of each family must be detected. Consequently, the preparatory work to determine the specific content of the Protocol has vital importance, based on meetings and interviews with different members of the Family.

Having stated the above, it seems clear that the contents of the Protocol are not closed but shall depend on the specific circumstances in each case.

Nevertheless and despite the fact that there is no standard Family Protocol form, it is common to include the following sections:

1. The guiding principles of the Family Business.
2. System for the transfer of shares or corporate holdings.
3. Governing bodies.
4. The policies for remuneration, dividends, access to management positions.
5. The succession regime.
6. Marriage articles.
7. Prevention and resolution of conflicts.

4. Formalisation and effectiveness of the Family Protocol

Although there is freedom when formalising the Family Protocol, it is recommended that it be converted into a public document before a Notary and all family members who are affected by the Family Protocol be present at its granting.

Likewise, said document can be accessed at the Mercantile Registry, either by merely recording its existence but not its content, or by depositing it in full or in part.

Furthermore, since the ruling from the Directorate General of Registries and Notary Offices, of 26th of June 2018, which covers the possibility of establishing the mandatory compliance with the provisions contained in the family protocol as an ancillary provision in the Corporate Bylaws, it can be given greater force due to its enforceability against third parties.

Insofar as the content of the Family Protocol is widely heterogeneous and regulates numerous aspects of the Family Business, some of its agreements shall only have moral force (such as the family values or the company’s mission), while others will be enforceable as contractual agreements, and may even include penalties to compensate for damages and detriments that can be caused by the non-compliance of any family members.

Likewise, in order to strengthen the content of what has been agreed within the family, it is recommended that certain relevant aspects, such as the system for the transfer of shares or corporate holdings, be recorded in the corporate bylaws of the Family Business and consequently, be subject to ad hoc registration in the Mercantile Registry.

The Territorial Defense Agency of Mallorca (ADT) is an autonomous body of the Consell Insular de Mallorca (CIM), whose purpose is to exercise the island’s and/or municipal powers delegated in matters of urban development law enforcement on rural land on the island of Mallorca according to Article 166 of the current Law 12/2017 of December 29, of Urban Development of the Balearic Islands (LUIB).

In the case of municipalities, municipal powers may be voluntarily conferred to the ADT through the relevant delegation agreements between the ADT and the various local authorities.

Therefore, the ADT can take action to detect urban development violations on rural land, both on its own initiative under the urban development powers of the Consell Insular de Mallorca itself, as well as by municipal delegation pursuant to the various agreements it has signed with the relevant city governments. 

The commission of an urban development violation will always result in a fine, even when unauthorized works have been made legal.

The amount of the fines will always depend on the type of violation committed by the offender since, according to Law 12/2017, in most cases, the penalties will be calculated based on a specific percentage of the value of the completed works.

When processing the penalty dossier, the ADT is governed by the procedure set forth in Decree 14/1994 dated February 10, which approves the Regulations on the procedure to be followed when exercising the authority to impose fines.

Once the alleged offender has been notified of the decision to initiate a penalty dossier, they shall have fifteen days to file a written statement of arguments with the ADT in response to the decision to initiate the dossier. Once the interested party has filed arguments, the case officer will draw up the Resolution Proposal, granting a new fifteen-day period for the interested party to file a new argument as they deem appropriate.

Once this second written statement of arguments has been rejected, the ADT will then issue the relevant resolution of the penalty dossier, imposing the appropriate fine in accordance with the classification and calculation made during the administrative processing of the dossier.

At this point, the following question arises:

Is it possible to apply a discount to the fine imposed while the penalty dossier is being processed?

Once the offender has been notified of the Resolution initiating the penalty dossier, they may avail themselves of a series of choices regarding acknowledging and paying the fine. In fact, the reduction that may be applicable will depend on the choice made.

The following discounts are possible:

• In the first case, there is a voluntary acknowledgment of liability and express waiver of any legal action or appeal against the fine, which will result in a 20% discount of the fine.

If the acknowledgement is accompanied by payment in the case above, the discount will be 40%, so that only 60% of the fine will be paid.

In these two cases, the discount is granted regardless of whether any unauthorized works have been legalized or restored.

• When it comes to legalization, referring to those cases in which the works do not comply with urban development regulations, the fine will be discounted 95% if legalization is requested and obtained within the period granted by the authorities (2 months).

The discount will be 80% if the legalization is requested after the aforementioned 2 month period has elapsed but before the resolution ordering that which has been altered to be restored.

• There will be a 90% discount if that which has been altered is restored before the resolution has been issued.

If what has been altered is restored after the resolution has been issued, but within the voluntary period, the discount will be 80%.

In short, these regulations follow the model of favoring, encouraging, and promoting legalization whenever possible and restoring what has been altered when legalization is not possible, establishing considerable discounts on the penalties initially imposed.

This is a clear trend towards legalization and restoring illegal works.

Bitcoin (BTC) was created in 2009 by the still-anonymous Satoshi Nakamoto as a digital currency that could be described as a “digital representation of value”. It has since become an alternative to the traditional financial system, establishing a system for performing economic transactions digitally in a way which doesn’t involve central banks or public authorities and, as a result, avoids being controlled by any country or institution.

Its use has gradually gained ground among the general population, experiencing exponential growth over the last few months. A few days ago, even reaching the once-unimaginable goal of one bitcoin was worth 60,000 US dollars.

Society’s growing interest in the use of cryptocurrencies has meant that many companies have pushed to legalise it in Spain and accept it as a payment method as a way of adapting to the inevitable digital transformation that the market will undergo. Microsoft, Expedia, KFC and Subway are just a few of the companies that accept bitcoin or other types of cryptocurrency in lieu of traditional payment methods.

Although cryptocurrencies are commonly known as digital currencies, as defined by the European Union[1], the truth is that many government bodies are hesitant to legally regulate cryptocurrencies and accept their use, something that is already widespread in countries like Germany and the United States. Thus, even though some world governments are leaning towards welcoming this new social reality with open arms and are acting accordingly, just like New Zealand, for example, by permitting bitcoin and other cryptocurrencies to be used to pay worker salaries, it’s safe to say that Spain is not one of them.

In this regard, Spain’s Supreme Court (STS, Criminal Court, no. 326/2019 of 20 June 2019) has ruled that bitcoin and other cryptocurrencies may not be considered as money or currency of any kind, reminding us that the only legal tender that can be used in the country is the euro. The Spanish Senate is fully aware of the need to regulate the situation in order to uphold legal security and prevent fraud and has pushed the government to regulate their use.

The Bank of Spain and the Spanish National Securities Market Commission (CNMV), on the other hand, have, up until now, warned of the possible risks associated with their use on several occasions. On Saturday 13 March, however, Spanish Royal Decree-Law 5/2021 of 12 March on extraordinary support measures for business solvency in response to the COVID-19 pandemic was published, in which the complexity, volatility and potential lack of liquidity that may arise from investing in this type of asset were laid bare, resulting in the modification of Royal Legislative Decree 4/2015 of 23 October approving the consolidated text of the Spanish Securities Market Law, granting the CNMV the power to control the advertising of cryptocurrencies and warn of the risk they present.

Notwithstanding the previous paragraph, the fact that cryptocurrencies still lack regulation in Spain and that they are not yet recognised as a digital currency or token does not necessarily mean that they aren’t legal. That’s why it is vital to understand that cryptocurrency is a type of digital and non-fungible movable property, and when exchanged for money or another cryptocurrency, it is considered as barter, in accordance with the definition found in Article 1,538 of the Spanish Civil Code, which reads: “Barter is a contract whereby one of the contracting parties undertakes to give an object to receive another.” 

So, after having reached this point, the key question is: can my company accept payment in bitcoin?

The truth is that doing so is entirely legal. However, you must consider that a “collection”, according to its legal definition, does not occur, but instead a barter, as stated above, and as such, the amount being exchanged will be considered property. In this sense, when issuing an invoice for the purchase (assuming that the purchaser is not exempt from paying the corresponding VAT), the product’s value must be translated into a legal currency, the euro in our case. In addition, it is also worth mentioning that companies will be in no case obligated to accept cryptocurrencies as a payment method, given that this obligation is strictly limited to legal tender.

It seems that Spain is refusing to admit that cryptocurrencies are a social reality that is here to stay, which, instead of dissuading citizens from using them, is, in fact, leading to great legal insecurity and the proliferation of several frauds becoming all too common. This is all because this lacuna in the law does not impede large and medium-sized companies from accepting them and joining the unstoppable digital revolution.

And with the CNMV receiving more powers to control cryptocurrency advertising, it’s safe to say that we’ve still got a long journey ahead of us.

[1] Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for money laundering purposes or terrorist financing.

1. British Residents in Spain

On December 31, 2020 the transitional period ends, after which the United Kingdom will no longer be part of the European Union, but will be considered to be a “third country” with the loss of rights and obligations derived from EU law which will entail, in particular, the right to freedom of movement and residence that so characterizes the EU countries.

Many British nationals live in Spain, so one of the problems is what will happen to those who have British nationality but live in Spain. In response, the Withdrawal Agreement, which came into force on February 1, 2020 and regulates the conditions for an orderly withdrawal, protects both United Kingdom nationals residing in Spain at the end of the transitional period and their family members who are nationals of a third country, provided that they are family members before the end of the transitional period, so that at the end of the transitional period they will continue to maintain their rights of residence, work, study and social security.

The Agreement establishes two types of procedures in order to benefit from it:

• (i) a constituent procedure, by which a new status as a resident of the host State must be applied for;

• (ii) a more tacit procedure, based on the issuance of a residence document by the host State at the request of the person concerned, expressly identifying them as beneficiaries of the Agreement.

Spain has chosen the second option, so that British nationals who reside in the country before December 31, 2020 will not need to apply for a new residence document. Registration certificates and family cards of EU citizens obtained before the end of the transitional period will be sufficient to subsequently prove their legal residence in Spain, although from July 6 on it will be possible to apply for the issuance of a residence document, in which the condition of beneficiary of the Withdrawal Agreement is expressly indicated and which will guarantee their rights as a resident in Spain.

Although obtaining this document is highly recommended, since it will facilitate both the completion of administrative procedures and the crossing of the external border, it will not be obligatory in order to continue residing in Spain after the transitional period has ended.

For residents who do not have a registration certificate, although they may continue to reside in Spain, it is advisable to apply for a residence document. It should be noted that from July 6 to December 31, 2020, all applications for registration certificates shall be understood and processed directly as a residence document that identifies them as beneficiaries of the Agreement in order to avoid double requests. This residence document can be obtained at the immigration office of the province where you reside or electronically, proving your residence in Spain before the end of the transitional period.

Finally, and for all British nationals who come to Spain once the separation process has been completed, i.e., after January 1, 2021, and who wish to apply for Spanish residence, they will have to abide by different rights, as they will be treated as nationals of a third country, although this will depend to a large extent on the future relations agreed with the EU.

2. British Non-residents in Spain

Until December 31, 2020, British citizens will be able to continue traveling to the countries in the Schengen area or anywhere else in the EU with their British passport without any limitation based on their nationality and residence.

As of January 1, 2021, their passports must have at least 6 months of validity to travel to most countries in Europe (not including Ireland). Likewise, taking into account that from that date onwards, British citizens will be regarded as citizens not belonging to the European Economic Area, various border controls will be applied to them when they travel to other EU or Schengen area countries. In addition, they may be required to show (i) a return or round-trip ticket and (ii) that they have sufficient financial resources for their stay.

Also, as of that date, unless a different agreement is reached, British citizens will be able to travel to other countries in the Schengen area, including Spain, for up to 90 days in any 180-day period without needing a visa for purposes such as tourism.

To stay longer (whether for work, study, or business travel), one must comply with the entry requirements established by the country to which one is traveling, which may mean the need to apply for a visa or work permit.

3. Other aspects of interest

a. Driver’s license

In the case of residing in Spain and driving with a British license, the license must be replaced by a Spanish one before December 31, 2020. Simply go to the Spanish Department of Motor Vehicles (DGT) to complete the procedure, presenting a valid residence document in Spain and a photocopy of the British driver’s license certified by a notary. The British driver’s license must be handed in at the time of the exchange for a Spanish driver’s license. If you want to do the procedure after January 1, 2021, you must take a new driving test.

For non-residents, there is no formal agreement yet, but some extra paperwork will probably be required in order to drive in Spain for an extended period.

b. Pets

As of January 1, 2021, you will not be able to use the current pet passport system. Instead, you will have to follow a different process, which could take up to 4 months (https://www.gov.uk/guidance/pet-travel-to-europe-after-brexit).

c. Free Roaming

Unless otherwise agreed, starting on January 1, 2021, free cell phone roaming throughout the EU, Iceland, Liechtenstein and Norway will end.

Please note that there are still long and complex negotiations, so this may change in the coming months.

By Roser Servera, trainee lawyer of the International Desk of Bufete Buades, and Gabriel Buades, firm partner.

On May 25, Decree-Law 9/20 on urgent territorial protection measures for the Balearic Islands (BOIB no. 92 of May 25, 2020) was published and took effect.

As far as the regulations are concerned, they are divided into two chapters:

• The first chapter deals with provisions concerning urban development land. Measures are planned in this regard for consolidated urban land, unconsolidated urban land, land for development, and non-programmed land for development.

• The second chapter takes into account an important yet diverse list of restrictive measures for rural land and its urban use.

Once the aforementioned aspects have been established, we turn to analyze the impact on urban development land, especially on programmed and non-programmed land for development. 

1. Urban development land: land for development and non-programmed land for development.

Regarding the land for development and the non-programmed land for development, this regulation provides for a genuine declassification of land and this land is automatically declassified as rural land, under the category of common rural land, when the requirements of Decree-Law 9/20 of May 25 are met.

We will not analyze the necessary requirements for declassifying land since this topic was already discussed in a previous blog article. Suffice it to say now that the regulations provide for a common status for land affected by declassification: expiration of the deadline stipulated in the municipal zoning or urban development plan, if applicable, in order to carry out urban land transformation work without this work having been fully completed.

Once the land has been declassified, it is Decree-Law 9/20, which states in Article 6.4 that rezoning of land for development in accordance with the provisions of the article shall not result in compensation in accordance with state legislation.

We find this idea in state legislation in Article 11.1 of Royal Legislative Decree 7/2015 of October 30, approving the revised text of the Land and Urban Renewal Law; as well as in the Balearic regional legislation, according to Article 6 of Law 12/2017 of December 29, on Urban Planning in the Balearic Islands.

As a result of the above, would there be any type of compensation should land be declassified as mentioned above under these new regulations?

The answer to this question would depend on the time frame applicable. In other words, if the urban land transformation work had been carried out by the deadline set by the municipal planning authority for building the development, or, on the contrary, if this work was done after the deadline had expired.

2. By the deadline set by the municipal planning authority.       

2.1. Compensation for the loss of the right to participate in new urban development work.

According to Article 38.1 and 2 of Royal Legislative Decree 7/2015 of October 30, approving the revised text of the Land and Urban Renewal Law, it is possible to compensate the owner for declassifying his/her property when declassification of his/her land occurs within the deadline established by the municipal planning authority for building the development.

In this case, and the event that construction work on the land has not started to provide basic utilities, the article above states that the owner may demand, as compensation, the loss of profit due to the loss of the right to participate in the new development of his/her land, or due to a change in its status.

The compensation for preventing the exercise of the power to participate in this work or changing its status would, in any case, be the result of applying the same percentage determined by the law on territorial and urban planning for the community’s involvement in the capital gains in accordance with the provisions of Article 18.1(b) of the law mentioned above.

2.2. Compensation for work and promoting urban development or construction.

For the case of having begun urban transformation work before the deadline, Article 39 states that when the urban development expenses incurred become pointless for those who have incurred them due to the effects of the provision, the act or the fact that motivates the appraisal, these expenses and costs will be assessed for their amount plus the risk-free rate and the risk premium.

Here we are talking about:

• Expenses incurred for preparing the project or technical projects of the planning and execution instruments that, according to regional and urban planning laws, are necessary to justify urban development, construction, conservation, or building renovation work.
• Expenses for construction work and the financing, management, and development required for carrying out the project.
• Any compensation paid.

In this case, the second paragraph of the law states that the urban development work will be appraised in the manner established above, or in proportion to the extent to which it has been completed – the % completed and applied to the value of the completed urban development – whichever is greater, provided that the development is carried out in accordance with the instruments that justify it and that the deadlines established therein have not been exceeded.

To do this, the extent of completion will be assigned a value between 0 and 1, which will be multiplied:

• By the difference between the value of the land in its original status and the value it would have if the work had been completed, when the provision, act, or fact that motivates the appraisal prevents its completion.
• By the loss caused in the value, the land would have if the work had been finished, when only the conditions of its performance are modified, without preventing its completion.

In short, any changes in the planning before the deadline set in the Phase Plan would determine the compensation of the expenses incurred by the interested parties entrusted with the continuation of the Plan. (Supreme Court, Contentious-Administrative Chamber, Judicial Division 6, Ruling dated June 27, 2006. RJ 2006\4754). Here, we will include all the costs incurred in connection with the construction done.

3. After the deadline set by the municipal planning authority.

3.1. Management costs incurred by not having begun any urban development transformation work.

The owner would only have the right to claim compensation for the urban development expenses incurred and no other compensation.

This is because, as our Supreme Court pointed out, land ownership is statutory (Supreme Court, Chamber Three, Contentious-Administrative Chamber, Judicial Division 5, Ruling dated September 29, 1998, Rec. 938/1992); and by virtue of this, the simple fact that the land classification is changed does not create a right to compensation per se for the affected owner, but rather it is necessary for the owner to have carried out urban development transformation work, and as a result, having paid the urban development costs needed for the allocation of the land (Supreme Court, Chamber Three, Contentious-Administrative Chamber, Judicial Division 6, Ruling dated October 11, 2004, Rec. 7846/1999).

3.2. Carrying out all urban transformation work.

Another case involving compensation after the municipal deadline has elapsed would be where the owner has done all the urban development transformation work for the land.

In this case, the Supreme Court considers that compensation would be due for the loss of the owner’s urban use, even though it has already reached the stage of property ownership of the land, that is, the consolidation of the owner’s rights, so that the compensation of the individual affected by the loss of this use of his/her land would also be applicable (Supreme Court, Chamber Three, Contentious-Administrative Chamber, Judicial Division 4, Ruling dated July 9, 2012, Rec. 6433/2010).

What happens when a change in planning occurs due to the approval of a legislative act?

4. A change in the planning due to the approval of Decree 9/20 of May 25 on urgent territorial protection measures for the Balearic Islands.

In this case, you should ask yourself which public agency you should claim the compensation from.

The compensation must be paid by the government responsible for the decision causing the declassification.

It would be worth considering whether the declassification is purely legislative, having ratified the Decree-Law, or whether it is due to the Balearic Government issuing the aforementioned Decree-Law, which was subsequently ratified.

In this sense, we believe that the measure’s decision-making body should be the Balearic government, without prejudice to subsequent ratification by parliament.

Within the framework of the State of Alarm in which the Spanish State was involved, all of this derived from the health crisis situation caused by COVID-19, the Spanish Government issued Order INT/239/2020, of 16 March, re-establishing of internal border controls and, subsequently, Order INT/270/2020, of 21 March, establishing criteria for the application of a temporary restriction of non-essential travel from third countries to the European Union and associated Schengen countries for reasons of public order and public health reasons. Consequently, during the State of Alarm period, only (i) Spanish citizens, (ii) those who could prove that Spain was their usual country of residence, (iii) cross-border workers, (iv) health or elderly care professionals going to carry out their work activity or (v) those who could prove force majeure or a situation of necessity were allowed to enter Spanish territory. Likewise, Order SND/403/2020, of 11 May, established the obligation for travellers from foreign countries to respect quarantine measures.

After the end of the State of Alarm in Spain, on 21 June, the Community borders and the Schengen Area were opened, allowing the entry of travellers from these countries, including the British who, although not part of the Schengen Area and in the process of withdrawing from the European Union (EU), are still holders of full rights and obligations as far as the EU is concerned. Portugal is an exception since, following an agreement between the two countries, a decision was taken to delay the entry of its residents until 1 July. Likewise, the obligation to respect quarantine measures for those travelling to Spain from EU countries (except Portugal) and the Schengen area has been lifted.

In order to guarantee more safety, Foreign Health carries out a triple check on travellers upon arrival. If they do not pass any one of them, they must undergo a medical examination at the airport itself to determine whether or not their health situation is suitable for them to move freely around the country. This triple check involves (i) a documentary check, during which a document provided by the airline must be filled in, specifying the addresses departed from and travelling to as well as health data; (ii) a temperature check, which cannot exceed 37.5 degrees; and finally, (iii) a visual check, during which the traveller’s apparent health condition is observed, all of this in order to avoid a possible case of COVID-19.

As of 1 July, the gradual reopening of international tourism, i.e. with third countries, is planned. However, in order to do so, Spain must comply with the list of countries that the EU prepares after carrying out different agreements with those states that it considers “safe” as far as COVID-19 is concerned, considering the epidemiological situation of each of them.

By Roser Servera, trainee lawyer at the International Desk of Bufete Buades.

On 25 May, Decree-Law 9/20 on urgent territorial protection measures for the Balearic Islands was published and took effect.

The Decree Law is divided into two chapters, each referring to different types of land.

• Chapter I deals with provisions concerning urban development land in which measures are adopted for unconsolidated urban land, land for development and non-programmed land for development.

A moratorium or suspension of administrative procedures is being considered for unconsolidated urban land, whereas a real declassification is underway for programmed and non-programmed land for development.

This moratorium and declassification policy should not prevent or influence prospective developers from making appropriate decisions in this regard within the existing legal constraints.

• Chapter II deals with measures for rural land.

A summary of the provisions is provided below and their specific articles should be referred to for further details and information. 

I. Considerations for urban land with unconsolidated development

The provision provides for a suspension of procedures for development planning, administrative means, and the granting of any permit or license for all urban land with unconsolidated residential, tourist, or mixed use that meets all of this article’s requirements, which shall remain in effect until December 31, 2022 or until final approval of the adaptation of the planning.

This is land that has the status of urban land under current plans, but does not have the urban services established in the Balearic Islands’ zoning laws, and therefore, according to those laws, should not have the status of urban land.

Its purpose is to adapt these areas to the current regulations which may lead to their classification as land for development or their declassification, becoming rural land.

For this purpose, the relevant Island Authorities and the City of Palma are responsible for implementing this new zoning or adaptation which must be initially approved before December 31, 2021. Otherwise, the Balearic Government would assume jurisdiction.

This moratorium on the adaptation of certain unconsolidated urban land only affects those areas that meet all of this article’s requirements, which are:

• Urban land thus classified for residential, tourist, or mixed use which does not have urban services.
• The general municipal zoning is not in line with the Island’s Territorial Plan.
• An area or local development area must be defined in order to provide urban planning services. It does not affect unconsolidated urban land where the land owner can complete the urban services it lacks by means of a service provision project, but only those needed to create a “future development”.
• No work has been started.
• If they are not within the completion deadline.
• They are not surrounded by more than 2/3 of fully developed land.

Therefore, its purpose is to suspend all procedures on this type of land until the relevant Island Authorities or the City of Palma, where appropriate, adapt the planning with the power to zone it as land for development or rural land.

II. Re-zoning land for development

Unlike the moratorium on unconsolidated urban land, when it comes to programmed land for development and non-programmed land for development, there is a real declassification.

a) Regarding land classified by the zoning plan as NON-programmed land for development, it will be declassified if it is more than 8 years old and the Urban Development Plan has not been initially approved. Therefore, it becomes common rural land.

For this type of land, it is not necessary to meet the requirements concerning land for development, but only the deadline having lapsed and the lack of initial approval. There is also no distinction based on use.

b) Land for development or suitable for development intended for residential, tourist, or mixed use that meets certain requirements will also be automatically declassified, becoming common rural land.

The requirements for the declassification of this land for development are:

• The general municipal zoning is not in line with the provisions for land for development in the Island’s Territorial Plan.
• No physical construction of the new development has been started.
• The deadlines for completion have expired.

The first transitional provision states that the classification of urban or land for development will be maintained for land that is processing its adaptation to the Island’s Territorial Plan when the Decree-Law takes effect, on the understanding that it must have received initial approval no more than three years after the last essential act in its processing.

This would be an exception to the previous rules since the adaptation process required by the rules has already begun.

III. Rural land regulation

With regard to rural land, a series of measures have been adopted that reduce certain building standards which can be summarized as follows:

• Impossibility of building new single-family homes on land included in areas where there is a risk of erosion, landslides, fire or flooding, unless they are associated with agricultural activities.

• Reduction of building standards for rural land in the Island’s Territorial Plan:

• On a maximum buildable area:
  • Xarxa Nature Land and Rural Area of Scenic Interest (ARIP). – 1%
  • Other rural land. – 1.5%
• Maximum percentage of the lot that can be occupied by the building and other construction items:
  • Xarxa Nature Land and ARIP. – 1.5%
  • Other rural land. – 2%
• Maximum volume of the entire building in all categories of rural land. – 900 m3.

Notwithstanding the above, municipal or urban planning could be more restrictive.

• When applying for new buildings and complete renovation of existing ones, except for agricultural and livestock farms, a technical project must be submitted that includes certain environmental and natural landscape integration measures that may affect land reclamation, keeping cultural and ethnographic aspects, reducing the impact of light pollution, traditional enclosures, etc.

• The current water measures consist of rainwater collection and reuse and for residential single-family use, only one swimming pool can be built per property with a maximum water mirror of 35 m2 and a maximum volume of 60 m3.

These measures are not applicable if the latter has approved a modification or revision of the Island’s Territorial Plan in the two years prior to this Decree Law’s approval.

Nor will it affect permit requests made for rural land prior to it taking effect if the request is fully documented.

I. Introduction

Before engaging in a discussion of why the Spanish Supreme Court has considered the events in question to be criminal  acts of sedition and not crimes of rebellion, both concepts must be defined within their context in the Spanish Criminal Code.

The crime of rebellion is defined in article 472 of the Spanish Criminal Code as to ‘…violently and publicly rise up…to…repeal, suspend or amend the Constitution…or declare the independence of any part of the national territory‘. That violence be used as an INSTRUMENT to achieve the objectives of such a plan comprises an essential component of this crime.

Thus, for this particular criminal act to take place, those participating in the uprising must objectively be able to carry out the actions mentioned in  article 472 of the Spanish Criminal Code..

On the other hand, article 544 of the Criminal Code establishes that: Conviction for sedition shall befall those who, without being included in the felony of rebellion, public and tumultuously rise up to prevent, by force or outside the legal channels, application of the laws, or any authority, official corporation or public officer from lawful exercise of the duties thereof or implementation of the resolutions thereof, or of administrative or judicial resolutions.

The Spanish Supreme Court holds that its role is to deliberate the penal code with relation to applicable criminal acts. It affirms that, ‘It is not our place to offer—nor even suggest or insinuate—political solutions to a problem with deep historical foundations’,…//… ‘To subject the role of the courts to the standing political circumstances and impose its power to prohibit upon events which are intimated to be connected to criminal precepts is to place the balance that defines our ability to live together in democratic harmony at serious risk.’

The Supreme Court believes that while ‘violence indisputably occurred’[1], no offense of rebellion was committed on the basis that, for it to have occurred,  ‘Violence must be instrumental, purposeful, and directly intended, without intermediate steps, to achieve the ends that the rebels pursue’.

According to the High Court, the defendants were aware that a referendum for self-determination was clearly not legally viable and that the offer of the right to decide was a ‘decoy’ to trigger a mass demonstration.

It likewise stresses that ‘earnest’ citizens did not know that the ‘right to decide’ had become an ‘odd sort of “right to exert pressure” ‘. This was actually a ‘strategic formula of political pressure’ that the defendants wished to exert upon the Spanish government. What the defendants really wanted was a ‘direct negotiation’ with the standing government. There is no ‘right to decide’ that can be exercised outside legal limits. No international treaty exists that has codified a  right to decide.

II. The criminal nature of both offences

The sentence imposed upon those who have induced or directed sedition can range from 8 to 10 years of imprisonment. However, if these persons ‘have the status of authority’, the punishment increases to a term of 10 to 15 years in prison.

The text prescribes a prison sentence of 15 to 25 years for ‘ringleaders’ of rebellion and those who ‘inducing the rebels, have promoted or sustain the rebellion’. ‘Those who act as subaltern commanders’ may be sentenced to a term of 10 to 15 years of imprisonment. Lastly, the Criminal Code stipulates prison sentences from 5 to 10 years for ‘mere participants’.

The harshest sentence, 25 to 30 years in prison, is established for rebel ringleaders in the event of the use of weapons, combat, the cutting off of communications, demand for contributions, diversion of public funds or exercise of ‘serious violence against persons’.

III. The judgement handed down by the Supreme Court

A.- Offences of sedition and misuse of public funds for the purpose of committing sedition

The Spanish Supreme Court has sentenced 9 of the 12 defendants for the crime of sedition pursuant to article 545(1) of the Spanish Criminal Code. Said article states ‘those who have induced, sustained or directed the sedition or who appear as the main doers thereof, shall be punished with a sentence of imprisonment from eight to ten years, and with that ten to fifteen years if they are persons with the status of an authority. In both cases, absolute barring for the same term shall also be imposed’.

The Chamber holds that the accused, Mr Junqueras, Mr Romeva, Mr Turull and Ms Bassa, shall be considered to have induced sedition and as such, by the authority pursuant to the terms established in article 24(1) of the Criminal Code, are subject to the criminal proceedings corresponding to those who, ‘…alone, or as a member of any corporation, board or collegiate body, have a commanding post or exercise jurisdiction pertaining thereto’, as well as ‘…members of the…Legislative Assemblies of the Autonomous Communities’.

Likewise, the Supreme Court considers the accused to have maintained a functional authority possessing the decision-making capacity to collaborate and create the conditions for collective criminal action. Mr Oriol Junqueras was the vice president of the Catalan regional government, the Generalitat, and the minister of economy and finance. He was therefore situated at the highest levels of the political-administrative organigram which was put into the service of sedition. Mr Junqueras, Mr Romeva, Mr Turull and Ms Bassa were members of the executive branch of the Catalan regional government, the Govern.

The Supreme Court’s punishment also extends to the offence of misuse of public funds for the purpose of committing sedition to the accused.

Article 432(1) of the Criminal Code punishes authorities or public officers who commit the offence described in article 252 as misappropriation of public funds or property with 2 to 6 years of imprisonment and absolute barring from public employment and office for a term of 6 to 10 years.

Article 252 of the Criminal Code sanctions misappropriation as committed by ‘those who, to the detriment of another, appropriate or steal moneys, belongings or valuables or any other moveable or personal property they have received in deposit, in trust or for administration, or by any other title that produces the obligation to deliver or return them, or who deny having received them…’.

Article 432(3) establishes that aggravated cases of embezzlement correspond to amounts exceeding 250,000 euros, requiring the imposition of a sentence in the upper half of the range which may reach the maximum amount.

The Supreme Court maintains that the accused, Mr Junqueras, Mr Romeva, Mr Turull and Ms Bassa, have committed an aggravated offence of disloyal misuse of public funds, given that they placed the departments under their charge at the service of holding of the illegal referendum, the total expense for which exceeded 250,000 euros.

The Chamber believes that public funds were misused for the purpose of committing the offence of sedition. The Supreme Court holds that there is an unquestionably instrumental relationship between these two offences because the public expenditures were allocated to the holding of the referendum. The amounts used were necessarily earmarked for that purpose.

Pursuant to article 77(3) of the Criminal Code, in the event of a sole fact constituting two or more crimes, or when one of them is the necessary means to commit the other, ‘…the upper half of the punishment foreseen for the most serious crime shall be applied without, exceeding the aggregate punishment that would be applicable if the crimes were punished separately’.

Without exceeding these limits, Judges or Courts of Law shall impose individualised punishments to each convict pursuant to the criteria expressed in article 66. Notwithstanding, the maximum effective sentence to be served may not exceed what is set forth in the preceding article’.

The Chamber holds, having weighed the considerations heretofore explained, that the persons who have committed the offences of sedition and misuse of public funds for the purpose of committing the act of sedition as described in article 77(3) of the Criminal Code shall be punished with the following sentences: Mr Oriol Junqueras, 13 years in prison; Mr Raül Romeva, 12 years in prison; Mr Josep Turull, 12 years in prison; and Ms Dolors Bassa, 12 years in prison.

VI. On the application of article 36(2) of the Spanish Criminal Code and the classification of convicts as eligible for the benefits of pre-release prison rules

The Spanish Ministry of Finance requested that the Chamber apply article 36(2) of the Criminal Code such that the imprisoned convicts would not be considered eligible for the benefits of pre-release prison rules until half of their prison terms have elapsed.

Article 36(2) of the Criminal Code states that ‘When the term of the prison sentence handed down exceeds five years, the Judge or Court of Law may order that classification of the prisoner in pre-release penitentiary treatment not take place until half of the sentence handed down has been served’.

The Supreme Court believes that this power cannot be construed as a legal mechanism to forestall decisions of the prison authorities that are thought inconsistent with the severity of the offence.

Article 36(2) of the Criminal Code indeed gives the sentencing court the power to make a prediction of future danger so as to preserve the interests protected by law that were violated by the offence. The Supreme Court therefore declares that, ‘’The defendants have been penalised with custodial sanctions based on the offences of which they have been convicted, and by penalties of absolute ineligibility for public office that prevent them from standing for office at elections and from assuming responsibilities such as those they had at the time of committing the offences.’ Specifically, the Spanish Supreme Court states, ‘The power of the courts to review administrative decisions in the penitentiary domain that are thought unlawful is the best assurance that the prison terms will be served in accordance with an individual appraisal of compliance and progression’.

Based on their sentence, the convicted will undergo assessment by the Parole Board of their penitentiary institution, who, in turn, shall deliver a reasoned ruling on the most appropriate plan for each of the convicts within no more than two months’ time, which evaluates the offence committed, their sentence term and disciplinary aspects as well as preventive action, family support outside the institution, etc.

The Parole Board’s reasoned ruling shall be reviewed by the competent body within Catalonia’s regional government, the Generalitat. In the event that both of these figures decide that the most appropriate course for those convicted is pre-release penitentiary treatment, the Spanish Ministry of Finance must immediately be notified of this fact so as to facilitate the preparation of allegations or relevant claims against said ruling, if applicable, before the Parole Board approves or rejects this arrangement. Subsequently, an appeal may also be lodged with that same Parole Board Judge, as well as the Second Chamber of the Supreme Court, the corresponding judicial body, in the event that the Parole Board were to approve the penitentiary institution’s assessment at first instance.