Worry has spread through hundreds of companies. The European “Next Generation” funds and subsidies fuel this anxiety, particularly for businesses in gas-intensive industries such as ceramics, tiles, paper, glass, metals, synthetic fibers, and even food production. A rule in the Defense Authorization Act allows access to these resources even if a company has not yet paid its suppliers within the legally required 60 days, a standard that has been in effect since last September.
When the Cortes dissolved ahead of the anticipated July 23 general elections, the momentum behind this measure weakened. Government sources suggest that if the ruling party prevails, one priority will be to restore or adjust these provisions because they are vital for small and medium-sized enterprises and the self-employed. There is also consideration of keeping the option to renew, amend, or repeal measures that address VAT reductions on food, offering the necessary flexibility. This flexibility includes ensuring supplier payments are current, a condition that was hastily translated into a broader, less relevant law. Without this exemption, access to subsidies and European funds would be blocked under applicable rules. Documentation proving up-to-date supplier payments remains essential, supported by official sources.
The Creator and Growing Law, published in the Official State Gazette on September 28, requires companies with more than 250 employees receiving grants above 30,000 euros to demonstrate, in collaboration with their suppliers, compliance with payment terms. The proof must be issued by an auditor registered in the Official Register of Auditors.
Negotiations with the Ministry of Economy and the Multi-Sector Platform Against Crime (PMmcM) introduced a six-month grace period after the actual receipt of the subsidy, even if the company did not meet statutory deadlines for supplier payments at the time of application for assistance.
The platform added that failing to meet this extension would trigger a full subsidy refund. The rationale cited was the extra costs faced by gas-intensive sectors in 2022 due to the sharp rise in fuel prices.
“No step back”
Antoni Canete, PMcM president, confirmed that given the scale of the problem, a six-month flexibility would be introduced without backing down on vendor payment requirements. There is also a call for a sanction regime to address noncompliant companies.
Regulation to combat noncompliance remains unsettled. The sanction framework is viewed as essential to effectively address the challenge that predominantly affects SMEs and the self-employed. The situation has sparked frustration as attempts to approve the sanctions regime faced numerous extensions in Congress and moments of delay around the election timeline. Canete notes that once political momentum built toward approval, momentum sometimes stalled, seemingly undermining progress.
The law’s scope continues to grow, but several points require clarification. In addition to constitutional considerations, the Private Criminal State Observatory notes a lack of regulation for electronic invoices, which will become public by July 10 and could be approved before the elections. Electronic invoicing promises traceability, and the observatory will help demonstrate noncompliance. However, Canete insists that an active enforcement regime is necessary for real effectiveness.
With over a million SMEs and self-employed individuals affected, PMmcM estimated that late payments by Ibex companies could reach tens of billions of euros, with broader market implications running into even higher figures when the full market is included.