In setting out a strategy for your financial planning we often work with other professionals. In this article, lawyer Christopher Lee explains about Spanish Wills and the new laws that come into effect in August 2015, a change to the rules known as Brussels IV. Christopher has a wealth of experience having practiced in Spain for 20 years, speaks English and Spanish and is a qualified as an English Solicitor and is a registered lawyer with the Barcelona Bar.
Many know that, if you own Spanish properties (flats, houses, land, company shares) or have Spanish bank accounts in your name, then having a Spanish will to cover these valuable assets is an essential protection for your heirs. But if, as yet, you don't have such protection in place, there's never been a better time to "get round to it". And, even if you're reading this and (smugly) thinking you've got this covered, don't relax: the law's about to change and any Spanish will you already have should be reviewed now, and possibly redrawn.
With effect from 17 August 2015, a new EU Regulation comes into force in Spain and most other EU countries (although excluding some, such as the UK and Ireland). The new regime it introduces is complex and so proper, case-specific advice needs taking before making any decision over your wills. However this article highlights some important changes introduced by the Regulation:
- First, broadly speaking and at the moment, what happens to a person's estate after death is governed by their national law. So a Swede's estate on death will be ruled by Swedish law. This makes sense because someone's likely to be most familiar with the requirements imposed in their home state.
- However, as from mid-August this year, that'll no longer be the case. From then, the law of someone's country of habitual residence when they die will be decisive in deciding what happens to their assets on death.
- That means, for example, that an Englishman living in Spain who does not bother making a will to cover his Spanish assets, in the belief that the English intestacy rules he's familiar with will "do the job for him", is in for a shock – or rather his heirs could be. And that's because, should he continue living in Spain without having made a will and die habitually resident there after 17 August this year, it'll be Spanish (not English) rules that govern what happens to his Spanish assets. And Spanish rules differ significantly from those applicable in the UK, because Spanish rules require certain proportions of someone's estate to be left to given members of their family (notably children).
- Those Spanish rules under which certain family members must inherit pre-determined proportions of a person's estate - known in Spanish as legítmas – can, for instance, be particularly relevant to a man with "two families", that is children from a first marriage or relationship, who he's no longer in touch with and who he does not wish to benefit when he dies, and a new wife or partner and new kiddies who are the apple of his eye and to whom he intends to leave his wealth (to the exclusion of his first set of children). Were he to die habitually resident in Spain, the risk is that his new family will be obliged to share their inheritance with their older half-siblings, despite their father not having intended that.
- In order to avoid an inadvertent application of local, unfamiliar Spanish rules on death, the Regulation luckily allows you to specify that the rules of the place you happen to be habitually resident in when you die should not apply to your estate but, instead, it'll still be your national law that should hold sway.
- However, this election to revert to your national law must be clear and made in the right form, and in the right context. An obvious place to make this election is in a Spanish will and, here at Doménech Abogados, we're able to ensure this important choice of law is correctly and successfully dealt with.
- Of course, it's important when making any Spanish will that it meshes in the right way with any wills you have in other countries which may deal with your assets there. And again, we're well equipped to advise, since there are both Spanish and English lawyers working in our firm.
- Another new departure being brought into force by the Regulation is something called an EU succession certificate. This will be a useful tool when it comes to trying to sort out the Spanish estate of someone who has died habitually resident outside Spain. Thus, when the Spanish notary, Land Registry or tax authorities wants to know what should happen to the Mallorcan holiday villa of a German lady who's died habitually resident in Berlin, a German notary can be asked to confirm that in the form of a certificate, as provided for in the Regulation, and such certificate should be a simple and clear way of demonstrating what the German rules applicable to dealing with her estate actually provide.
Christopher Lee, Doménech Abogados
Download - Wills in Spain - New Rules
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.