The State takes over the fund that paid government suppliers

Automatic summary, not yet reviewed

1. The law dissolves and liquidates the Fund for the Financing of Payments to Suppliers and creates in its place the Fund for the Financing of Payments to Suppliers 2, a fund without legal personality that will manage the credit rights of the dissolved fund.
2. The new fund is set up with the credit rights against Autonomous Communities and Local Entities held by the dissolved fund, with no cash contribution. Its earnings, after management costs, go to the Public Treasury each year.
3. The Official Credit Institute handles the financial management of the new fund and will receive annual compensation for its costs. It must send quarterly information on collections, debts and financial position to several State Secretariats.
4. The State Administration automatically assumes all debts and legal relationships of the dissolved fund, including the borrowing operations listed in annex II, without changing their financial terms. It also takes over its treasury.
5. Loans to Autonomous Communities and Local Entities remain guaranteed through withholding of their funding resources and their share of State taxes, just as under the previous fund.
6. The fund's 2014 budget is approved, with management costs of 23,710 thousand euros, and the public sector contracting law is amended to set a 30-day payment deadline for contractors after certifications or approvals.

Who it affects

• Autonomous Communities and Local Entities with debts to the fund: The State becomes their creditor and can withhold their funding resources if they do not pay.
• Companies and self-employed suppliers of public administrations: Payments owed to them are now managed by the State; in addition, administrations will have 30 days to pay their contractors.
• Banks and financial institutions that were creditors of the dissolved fund: They will be paid by the State Administration, which assumes the debt on the same terms.
• Official Credit Institute (Instituto de Crédito Oficial): It takes over the financial management of the new fund and receives annual compensation for it.

Words worth knowing

Fondo sin personalidad jurídica (fund without legal personality)

A pool of money and rights managed within a ministry, not a separate entity able to contract or sue on its own.

Subrogación (subrogation)

One party automatically takes the place of another in debts or rights, on the same terms.

Derechos de crédito (credit rights)

The right to collect a debt from someone, here the loans the fund had made to regional and local governments.

Confusión de deudor y acreedor (merger of debtor and creditor)

A debt is extinguished because the same party ends up being both debtor and creditor.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries