Andorra Demòcrates Propose Bankruptcy Law Updates for Controller Pay and Oversight

The Demòcrates parliamentary group has proposed a series of amendments to update Andorra's bankruptcy regulations, including provisions to allow controllers in insolvency proceedings to receive payment.

The changes, tabled within a broader bill amending the Law on the Recovery and Resolution of Banking Entities and Investment Firms, target the Decree on Cessation of Payments and Bankruptcies. Controllers—responsible for auditing accounts and assisting the judge in overseeing administrators—could now be remunerated, provided they are not creditors in the proceedings.

Demòcrates also seeks to tighten eligibility rules. Like administrators, controllers must be appointed by the judge and hold expertise in accounting. In cases involving financial or banking entities, at least one must demonstrate accredited experience in finance and banking. The amendments explicitly bar individuals with family ties to the debtor up to the fourth degree of consanguinity, affinity, or adoption from serving as either controllers or administrators.

Further updates aim to modernise the order of credit priority by incorporating subordinated credits, refine procedural cost rules, and revise the treatment of ordinary credits—whether preferential or not—along with subordinated ones under the decree's second additional provision. Court and enforcement costs would be charged to the debtor's liabilities in each case, listed as privileged credits upon classification.

These measures are intended to align insolvency procedures with contemporary needs, enhancing oversight and creditor protections without altering core processes. The proposals form part of the ongoing legislative review, with no timeline yet set for debate or approval.