Spanish Bar Council puts fund investment in law firms on its radar: 'It worries us greatly'
The CGAE's Professional Deontology Commission monitors fund operations in law firms and warns of structures that bypass the Professional Companies Act.
Fund investment in Spain's legal sector now has an official watchdog. The Professional Deontology Commission of the General Council of Spanish Lawyers (CGAE) is monitoring these operations closely for their risks to lawyers' independence, client protection and the profession's deontological control, El Confidencial reports.
"It worries us greatly"
"It worries us greatly," says Manuel Mata, president of the CGAE's Deontology Commission, stressing that the debate goes beyond professionals' corporate interests: "It can affect a guarantee for citizens: that whoever advises them does so with total independence, with no interest other than their client's." The CGAE has received several queries in recent months, both from lawyers working in fund-backed firms and from lawyers advising on the deals themselves.
The concern focuses both on direct financial-capital entry and on corporate structures that, without formally bringing the investor into the professional company, give it capacity to influence the organisation, activity and economic decisions of the legal business. From ICAM, the Madrid bar, along the same lines: "Our concern is not the entry of capital itself, but that possible short-term profitability demands may end up conditioning decisions that must remain exclusively in the professional sphere."
What the Professional Companies Act says
Act 2/2007 does not mandate a specific corporate form, but requires that the majority of capital and voting rights correspond to professional partners, that they represent at least half plus one of the management body and that collegiate decisions require their favourable vote. Article 4.5 makes breach a ground for dissolution. An ordinary limited company owned by a fund does not acquire professional-company status merely by holding a stake in a law firm.
That is why, Mata warns, the analysis cannot be formal: "What matters is identifying who actually provides the legal service, who controls the organisation and who makes the decisions affecting the client relationship."
The Halmer factor
The Court of Justice of the EU judgment of 19 December 2024, Grand Chamber, case C-295/23 (Halmer), upheld Germany's ban on purely financial investors in law firms. It does not oblige other states to replicate the German model, but Mata reads in it the interpretive criterion relevant for Spain: "The lawyer's independence and the absence of conflicts of interest are guarantees for the citizen... and they are put at risk both by formal control and by mere capacity for economic influence."
The structures causing most unease
The maximum-alert scenario is the artificial splitting of the business: an ever-smaller professional company centred on signing documents, alongside fund-owned commercial companies assuming client acquisition, commercial relationships, support services, case financing and economic management. The risk is twofold: for the client, the guarantees of the professional company weaken; for bar oversight, the essential activity escapes disciplinary reach.
The legal system's answer exists, Mata recalls: "Article 6.4 of the Civil Code on fraus legis is one of them... The criterion must be material, not formal: who decides, who benefits and who answers to the client." And he warns: "There are opportunistic funds, American and European, that cannot develop these structures in their countries and are looking at Spain."
What comes next
The CGAE is not against financing or innovation, its officials insist, but this week's message marks a change of tone: from passive observation to public warning with a legal framework attached. Ongoing and future operations will now move with the certainty that the Deontology Commission is watching, and that the criterion will be material: who decides, who benefits and who answers.
For firms negotiating with investors, the practical reading is clear: corporate engineering placing the fund outside the professional company's formal perimeter is no longer a comfortable grey zone, but the scenario the profession has expressly said it will examine with the fraus legis magnifying glass.
Internal links
Fuentes
- elconfidencial.com. Accessed 29 October 2026.
The specific data in this article come from the official sources cited.
