These days we are all experiencing an extraordinary situation caused by a health crisis generated by the COVID-19, which has led to the declaration of a state of alarm by the Government through Royal Decree 463/2020 of 14 March.
During this period in which we are required to take responsibility for adopting the necessary measures to control the outbreak of a declared pandemic, the people of AVQ have decided to collaborate as much as possible and to adopt a solicitous attitude of citizen responsibility. Therefore, during the time of quarantine we will continue to offer our service from our homes, through technological means, maintaining maximum normality and efficiency in our professional and personal work.
Below, we address some issues related to the legal consequences that individuals and/or companies may face in the following areas:
Measures in the tax field
Procedural deadlines
Labor
Insurance Coverage
Life Sciences
[Warning: this report is for information purposes only and does not constitute a legal opinion under any circumstances]
Measures in the field of taxation
In order to avoid future treasury tensions, a series of measures are proposed to make the deferrals to the Tax Agency more flexible:
- To whom does it apply?
Individuals or legal entities whose turnover in 2019 does not exceed 6.010.121,04 euros may request the deferment of debts.
- What debts can be deferred?
Debts corresponding to declarations-settlements and self-assessments whose deadline for presentation and payment is from 13 March 2020 (date of entry into force of the Royal Decree-Law) to 30 May 2020, which would affect the declarations of the first quarter and the monthly declarations of February, March and April, can be deferred.
The postponement is extended to:
- Debts for withholdings or payments on account.
- Corporate income tax payments in instalments.
- Those derived from VAT.
- What amount can be deferred?
Debts not exceeding 30,000 euros may be deferred without the need to provide guarantees. In the case of debts that exceed this amount, they may be deferred with the appropriate formalisation of a guarantee.
- Under what conditions?
– The deadline will be six months.
– No interest on arrears shall accrue during the first three months of the deferment.
The Tax Agency has provisional instructions on its website for requesting deferrals in accordance with Royal Decree-Law 7/2020 of 12 March. We attach the link:
Important, by means of RDL 8/2020, of 17 March, it has been established that the suspension of the terms and the interruption of the administrative periods established in the Royal Decree that declares the state of alarm, will not be applicable to the tax periods, subject to special regulations, nor will it affect, in particular, the periods for the presentation of tax returns and self-assessments.
On the other hand, the Tax Agency of Catalonia (ATC), in accordance with the agreement of the “Departament de Salut” of Catalonia in the “Resolution SLT/720/2020 of 13 March adopting new additional measures for the prevention and control of the SARS-CoV-2 infection” as well as the Royal Decree 463/2020 declaring the state of alarm, has decided to adopt the following measures in relation to the provision of services to citizens
- Suspension and interruption of the deadlines for management, inspection and collection procedures.
- Suspension of limitation and prescription periods.
- Suspension of face-to-face care. The previous appointments already given are cancelled and the offices will remain closed.
These measures shall be in force and applied in all the offices, delegations and central services of the Tax Agency of Catalonia, until further notice.
The users have at their disposal:
– The telematic processing of self-assessments and tax formalities, as well as the electronic register that the Agency has enabled for those procedures that do not have their own telematic functionality.
– The contact form for making enquiries.
– The technological incident communication form to deal with problems arising during the telematic processing.
We include the link of the ATC with the mentioned measures in case it is of your interest:
http://atc.gencat.cat/ca/agencia/noticies/detall-noticia/20200315-informacio-mesures
Procedural Deadlines
- What about the legal proceedings that are underway?
The state of alert has caused all procedural and administrative deadlines to be suspended, with a few exceptions. That is to say, the legal proceedings that are under way are now suspended.
Once the state of alert and all its extensions are over, the deadlines will resume.
- Does this mean I can’t do anything before the courts?
No, there are some exceptions to the suspension of deadlines. Thus, the following actions can be taken:
- The procedure for the protection of the fundamental rights of the person provided for in articles 114 and following of Law 29/1998, of 13 July, regulating the Contentious-Administrative Jurisdiction, nor the processing of judicial authorizations or ratifications provided for in article 8.6 of the aforementioned law.
- The procedures of collective conflict and for the protection of fundamental rights and public liberties regulated by Law 36/2011, of October 10, regulating social jurisdiction.
- The judicial authorisation for non-voluntary detention on grounds of mental illness provided for in Article 763 of Law 1/2000, of 7 January, on Civil Procedure.
- The adoption of measures or provisions for the protection of minors as provided for in article 158 of the Civil Code.
However, the judge or civil, administrative, commercial or social court may agree to the practice of judicial proceedings “that are necessary to avoid irreparable damage to the rights and legitimate interests of the parties to the proceedings”.
In addition, during this time we can file briefs and lawsuits, since this is done over the Internet.
- What happens to the actions and rights you hold?
The periods of limitation and expiration of any type of actions and rights that a person or entity may exercise have been suspended for the duration of the state of alert and all its extensions.
- And what about administrative deadlines?
The state of alert has also meant the suspension of all administrative deadlines (except those referring to facts justifying the state of alert). Therefore, if you had to carry out any procedure with the administration, this has been suspended for the duration of the state of alarm.
However, it is provided that the competent body may agree, with reasons, “the measures of organisation and instruction strictly necessary to avoid serious damage to the rights and interests of the interested party in the procedure”. To this end, the latter must first express its agreement.
Labor
The temporary employment regulation file
- What do I do if my business has had to close due to the COVID-19 crisis and my employees are unable to telework?
The Workers’ Statute (henceforth, the ET) provides a solution for companies affected by the decline in their services, currently, due to the COVID-19 pandemic. Article 45 i) of this regulation provides for the suspension of the contract (former ERTEs), whose regulation has been made more flexible by Royal Decree Law 8/2020 of 17 March, on extraordinary urgent measures to deal with the economic and social impact of the COVID-19.
- What measures are introduced by Royal Decree Law 8/2020?
Royal Decree-Law 8/2020 of 17 March on extraordinary urgent measures to address the economic and social impact of COVID-19 streamlines ERTE procedures.
- What does the suspension of the contract mean?
The suspension of the contract implies the interruption of the obligation to work, as well as the interruption of the right to remuneration during the time that the ERTE lasts (art. 45.2 ET).
- So, my employees will not be paid?
Employees will be entitled to receive unemployment benefit (art. 262 of the General Law on Social Security) consisting of 70 percent of their regulatory base during the first 180 days and 50 percent as from the one hundred and eighty-oneth day.
- Do I have to pay social security contributions for my workers during this period?
In accordance with article 273.2 of the General Law on Social Security, the company must pay the corresponding Social Security contribution, with the managing entity (the SEPE, in this case) paying the contribution that corresponds to the worker.
However, Royal Decree-Law 8/2020 of 17 March on extraordinary urgent measures to deal with the economic and social impact of the COVID-19 has exceptionally provided that in the case of ERTEs due to force majeure, the employer shall be exonerated from the company contribution to Social Security contributions. However, the case of force majeure must always be proven.
- How do I prove the case of force majeure?
Royal Decree Law 8/2020, of 17 March, on urgent extraordinary measures to deal with the economic and social impact of COVID-19, establishes that COVID-19 will be a cause of force majeure mainly for establishments for which closure has been ordered or which have suffered contagion that puts their health at risk as a result of COVID-19.
Each specific case must be analysed to check whether the stoppage of the activity has indeed been directly caused by COVID-19. Otherwise, if the activity has been affected indirectly, an ERTE should be considered for economic, productive, organizational or technical reasons.
- What procedure should I follow to carry out the ERTE procedures correctly?
Article 47.1 of the TRE requires that there be a cause:
- If the crisis caused by the COVID-19 has led to the closure of the company or, for any other circumstance, there is a direct and serious effect on the activity (force majeure), an administrative file must be initiated before the labour authority, which must approve the cause for the suspension of the contracts within 5 days.
- If the crisis caused by COVID-19 has involved economic losses, organisational, technical or production changes produced indirectly by COVID-19 but not resulting from a closure order, imminent health risk, etc., a period of consultation with the workers’ legal representatives must be opened for a period not exceeding seven days, which must end with agreement between the company and at least the majority of the workers.
- And if the labour authority is late in responding, when can I put the measure into effect?
In case of force majeure, the ERTE measure will enter into force the same day of the causal event (art. 51.7 ET, force majeure), regardless of the delay in the procedures. In this case, the causal event would be the declaration of the state of alarm in force since 14 March 2020.
In the case of ERTEs for economic, productive or organisational reasons, the measure may be put into effect once an agreement has been reached with the workers and the labour authority has been notified.
Insurance Coverage
- Does insurance cover cases of force majeure?
There are many types of insurance contracts, mainly
– Damage insurance: these are insurance policies that completely cover the damage suffered by the insured. It can be an insurance of damage to things; or insurance with loss of profit, in which the insurer will compensate the insured for the loss of economic yield that could be produced by an activity in the event that the accident established in the contract does not occur.
– Personal insurance: includes all risks that may affect the existence, physical integrity or health of the insured (Art. 80 LCS).
– Accident insurance: covers bodily injury resulting from a violent, sudden, external cause unrelated to the insured’s intention, leading to temporary or permanent disability or death (Art. 100 LCS).
– Life insurance: covers the risk of the insured’s death (insurance in the event of death) or survival on expiry (insurance in the event of life).
– Health insurance and health care: Art. 105-106 LCS, In health insurance, the insurer is obliged to pay certain amounts and the costs of health care and pharmaceuticals. In health care insurance, the insurer will provide the insured with services arising from medical and surgical care for all types of illnesses and injuries.
In each case, the clauses must be examined, although as a rule, claims arising from force majeure are expressly excluded from insurance policies, and some make express reference to epidemics or pandemics.
Since the situation generated by COVID-19, also known as the coronavirus, has been declared a pandemic by the WHO, it may be considered a cause of force majeure and therefore exonerate insurers from liability for the economic consequences of any claim occurring due to this pandemic.
However, for some insurance policies, such as life and death insurance, which are usually more comprehensive, it will be important to review each individual case.
- Does this mean that my health care insurance does not cover the health care I may need?
On 12 March, UNESPA issued a statement in which it assured that the insurance companies (in cases of health care) would continue to provide their services with complete normality: “Health care is guaranteed for all clients. Health insurers facilitate access to medical care for those who show symptoms of a possible infection in the centres assigned to their care teams”. In this way, the insurers have guaranteed that they will cover health care and deaths caused by COVID-19. Therefore, in cases of health care insurance, care must be covered, even if it has its cause in the COVID19.
However, given the situation in which we find ourselves, the Government has intervened in the private health sector to place it at the service of the National Health System.
Life Sciences
- What legislative measures have been taken to ensure the supply of medicines, medical devices and other products necessary for health protection?
In order to deal with situations of shortage in the national health system, the Organic Law 3/1986, of April 14, on Special Measures in the Field of Public Health, provides in its article 4. a) that when a medicine or health product is affected by exceptional supply difficulties and in order to guarantee its better distribution, the State Health Administration may, temporarily, establish centralised supply by the Administration.
However, the special circumstances that we are experiencing these days regarding supply difficulties, has caused this centralized supply of medicines and health products to be insufficient to guarantee the supply of material necessary to manage the prevention of COVD-19. For this reason, the initial wording of article 4.a) of the aforementioned Organic Law 3/1986 has been modified in such a way that this power granted to the State Health Administration to establish a centralised supply is now considered not only for medicines and health products but also for any other product necessary for the protection of health that does not have the nature of a health product in accordance with the provisions of Royal Decree 1591/2009 of 16 October, which regulates health products.
This amendment was made through Royal Decree Law 6/2020 of 10 March, adopting certain urgent measures in the economic field and for the protection of public health. This Royal Decree came into force on 12 March, just a few days before the state of alarm was declared on national territory for the management of the health crisis caused by COVID-19.
In short, the modification introduced has been carried out precisely to guarantee the centralized supply of the State at the present time of material needed in our national health system and which, to date, were not considered a health product.
- Who does Order SND 233/220 oblige, and what does it oblige?
The action of the State Health Administration has not been long in coming and on 15 March the Ministry of Health announced by means of an order (order SND/233/2020 of 15 March establishing certain information obligations in relation to the provisions of the Royal Decree declaring the state of alarm) a series of information obligations that affect all foreign or national companies located in national territory that (i) have as their activity the manufacture and/or import of the medical devices listed in the aforementioned order or (ii) have the capacity to develop some of the medical devices listed in the aforementioned order. In general terms, the medical devices for which this information obligation is established are, among others, different types of masks, nitrile gloves, COVID-19 diagnostic test, disposable gowns, alcohols, protective glasses and ventilation devices.
The model declaration, which can be filled in digitally (https://sede.mscbs.gob.es/), requires filling in for each product, the available units, whether the declarant is the manufacturer or importer, and the daily units.
This information must be submitted by the companies concerned within two calendar days from the day following the publication of the aforementioned order in the BOE. Given that said order was published last Sunday, March 15. In the event of failure to provide such information or in the event of falsification of the same, such conduct will be considered a public health offence and may be sanctioned in accordance with the provisions of the General Health Law.
- What requirements can the authorities make of me?
Article 13 of Royal Decree 463/2020 of 14 March, which declares the state of alarm for the management of the health crisis situation caused by COVID-19, includes the power of the Minister of Health to
(a) issue the necessary orders to ensure the supply of the market and the operation of the services of the production centres affected by the shortage of products necessary for the protection of public health
(b) Intervene in and temporarily occupy industries, factories, workshops, farms or premises of any kind, including privately owned health centres, services and establishments, así́ such as those operating in the pharmaceutical sector.
- c) Temporarily requisition all types of goods and impose obligatory personal services in those