The Spanish justice system "shows signs of stagnation in the long term and also suffers from significant regional variability", says the latest report by the Club's Reflection Committee on Internationalisation

The Exporters' Club proposes promoting the digitisation of justice to speed up its functioning and improve economic competitiveness

photo_camera Antonio Bonet, president of the Exporters' Club

The Spanish Exporters and Investors Club proposes promoting the digitalisation of the Spanish judicial system, and in particular the streamlining of the first instance, in order to reduce the slowness of justice and thus improve the international competitiveness of the Spanish economy. 

This is set out in the latest report by the Committee for Reflection on Internationalisation, entitled "The proper functioning of the justice system as a factor of competitiveness and attraction of investment in Spain", authored by Juan S. Mora-Sanguinetti, senior economist at the Bank of Spain - Eurosystem. 

"The functioning of the justice system affects credit flows, the decision to create companies and business investment. All of these work better if the judicial system is more efficient", says this expert, who adds that "if a judicial system is very slow, it becomes a costly and very unpredictable instrument", making the country less attractive as a destination for foreign investment. 

International studies carried out by the OECD and the European Commission agree that Spain is not characterised by a judicial system that is better or worse than that of other comparable countries. In fact, according to these studies, the average time taken in Spain to resolve a civil dispute in the first instance is 272 days, while in France it takes 274 days, in Germany 200 days and in England and Wales 350 days. 

In addition to slowness, which is a consequence of judicial congestion, the other variable for comparing the "quality" of the different international judicial systems is the cost of using justice. And here again, according to World Bank data, Spain is comparatively worse off than other neighbouring countries. For every 10,000 euros that a plaintiff hopes to achieve by initiating legal proceedings, he or she will have to invest 1,720 euros in litigation costs. This amount is similar to France or Germany, but considerably lower than in Italy or the United Kingdom.

However, the fact that justice in Spain functions in a similar way to that of other neighbouring countries "should not lead us to complacency, as justice is an important element of economic development, which affects investment by providing greater legal certainty to the market", says Mora-Sanguinetti. 

For this expert, Spanish justice "shows signs of stagnation in the long term and also suffers from significant regional variability", with the most populated provinces and regions in Spain showing greater judicial congestion".

In order to strengthen Spain's attractiveness as a destination for foreign investment, the Committee for Reflection on Internationalisation of the Exporters' Club recommends improving our judicial system, for which it suggests prioritising digitalisation and continuing to focus on having good judicial statistics. This would be especially important in the first instance, in order to increase its agility. In this regard, the report recalls that countries that invest a higher proportion of their budget in information technologies and digitisation (ICTs) show shorter proceedings. Likewise, the productivity of judges increases the higher the ICT budget.

Another proposal of the Reflection Committee on Internationalisation is the promotion of alternative dispute resolution mechanisms, such as mediation, arbitration and conciliation, which in practice are often quicker and faster than ordinary court procedures. In this respect, some countries have used tax incentives to encourage companies to use these mechanisms. 

Finally, it recommends that legislators make an effort to reduce the complexity of regulation, which is one of the aspects that would explain the high level of litigation in Spain in the commercial field and which can be a disincentive to attract more foreign investment and to business growth and development.

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