Changes in the governing law to inheritance in the European Union
In 2015 the European regulation 650/2012 had come into force, which implies an important change on successions for foreigners living in Spain and spaniards living abroad.
If you are part of one of those groups and you have ever wondered how your succession will be regulated when you die, you have probably heard the applicable law to your inheritance is the law of your nationality, because that is the regulation that has existed until now. However, entering into effect the European regulation has changed that, so we inviteyou to continue reading this post.
¿When does it come into force the new regulation?
This regulation will be applicable to all the persons who die from 17 of august of 2015.
¿How did it work the previous regulation?
The governing law in Spain until now was established in article 9.8 of Spanish Civil code, which states that the applicable law to heritage is the national law of the deceased at the moment of death, with few exceptions that this article also mentions.
This meant that you could not choose the governing law to your succession because that one was determined for your nacionality. Thus, it did not matter if a foreigner had been living for years in Spain, at the moment of their death the applicable law to their inheritance for all their heritage was the law of their nationality. In the same way, to a native spaniard who had lost their spanish citizenship to adquire another, it was applicable the law related to their new nationality.
¿What are the implications of the new european regulation?
The new regulation fixes as a general rule that the applicable law to sucessions is the law of the country where the deceased has the permanent residence.
This change is very important, especially if we consider that the number of foreigners who decide at some point of their lives moving to live to Spain increase a lot year by year, and those persons can face, at the moment of their death, the surprise that the governing law to their succession is not the law of their nationality, but the spanish law.
Likewise, this affects to the spaniards who have their permanent residence in another country, to whom will be applied the law of the country where their are living.
The European regulation is enforceable to all citizens of the countries of European Union, as well as non european citizens. Denmark, United Kingdom and Ireland do not apply it in their territory, so it will not affect to the spaniards who are living there, but it is important to know that it is applicable to the citizens of those countries when they are living permantly in Spain or any other country of the Union.
It sets out only two exceptions to the general rule of permanent residence:
If in the light of all the circumstancies is clear that at the moment of the death the deceased maintains a closest relationship with other country different that the one their living. The legislator has not stated the criteria to reach that conclusion, but as it is established as an exception it will be necessary to be subject of a restrictive interpretation.
If it is explicty express by statement made in a will. In other words, you can order that the governing law to your sucession when you die are not the one related to your permanent residence, but the one of your nationality at the moment you make the will. And if you have more than one at this moment, you can choose among any of them.
If you are a foreigner living in Spain you may wonder, ¿why could be perjudicial for me that spanish law will be applied to my inheritance?
Well then, the answer is that spanish law (excluding the regions of Aragón, Catalonia, Balearic Islands, Galicia, Navarra and Vasc Country, which have their own Civil Code), limits tremendously the freeedom to bequeath. The testator must leave imperatively two thirds of their inheritance to their children and dispose freely only of the other third. In the case of absence of children, half of their inheritance must go to their parents and dispose freely only of the other half.
This could be very inconvenient in the case of foreigners that are living in Spain with their partner and they want to bequeath all their heritage or the majority of it to them, o they simply wish to leave their inheritance to a friend, an association or any other person.
In the same way, the succession system of another country of the Union could result perjudicial, from an Spaniard point of view.
Therefore, it is advisable for both, foreigner that have their permanent residence in Spain and Spaniards that are living abroad, to make a will where they explicity express their willigness to apply the law of their nationaly to their sucession.
At SPANISHLAWYERS | UNIABOGADOS® we are at your disposal to advise you on how to draft your will.