Commercial Registry Principles: Enforceability, Publication and Priority

Commercial Registry Principles

6. The Principle of Enforceability

The principle of enforceability is set out in Article 9 of the Commercial Registry Regulation (Reglamento del Registro Mercantil). Together with the principle of legality mentioned above, it is one of the most important principles of the registry system, as it determines when registrable acts can be relied upon against third parties. This principle comprises four aspects:

Subjects of Registration Acts

Registration acts are only enforceable against third parties in good faith from the date of their official publication in the Commercial Registry Bulletin (BORME). From the date of publication, it is presumed that third parties are aware of the registered acts.

Exceptions Within 15 Days of Publication

When the registered acts are not yet published, they may be invoked against third parties who prove they were unable to know of them, within 15 days following the publication of the registered documents.

Discrepancy Between Publication and Registration

In the event of a discrepancy between the content of the publication and the content of the registration, third parties in good faith may invoke the publication where it is favourable to them. In that case, the person who caused the discrepancy is obliged to compensate the injured party.

Good Faith of Third Parties

The good faith of third parties is presumed, unless proven otherwise. A third party is considered to be aware of the registration act when it has been published or when there is a discrepancy in the effects of the publication and the registration.

7. The Priority Principle

The priority principle is set out in Article 17 of the Commercial Registry Regulation. Under this principle, once a title has been recorded or noted preventively in the Commercial Registry, no other title shall be registered or noted that is incompatible with the result of that prior title.