ETL Global LINKS: Limitation of dividends distribution

Royal Decree-Law 18/2020, of May 12th, on social measures in defence of employment approved that dividends corresponding to a financial year during which temporary employment suspension or reduction (ERTE) is in force may not be distributed.

Therefore, that entities that have an ERTE may distribute dividends corresponding to financial year 2019 but may not distribute those corresponding to the 2020 and subsequent financial years in which any ERTE is applied due to force majeure.

And dividends corresponding to the 2020 financial year may only be distributed provided the amount corresponding to the exemption on the social security contributions is previously paid.

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