The latest EU regulation alters the Spanish law applicable to successions and raises doubts about how the inheritances of Spanish citizens residing in other countries would be resolved.
EU Regulation No 650/2012 alters the law applicable to successions, whether testate, intestate or subject to succession agreements. Does this matter? The answer is a categorical yes. It matters a great deal because it is the law applicable to the succession; it decides, for example, who the heirs are in the absence of a will or what amount of the forced shares the testator must necessarily leave to their closest family, among many other issues.
From the Spanish point of view, the most important novelty is that successions, in principle, are no longer governed by the law of the deceased’s nationality. The law applicable to the succession becomes the law of the place where the deceased habitually resided at the time of death.
This opens the door to our successions, or those of our relatives, being governed not by the national law (Spanish for Spanish citizens) but by another foreign law, that of the state where the deceased resided when they died.
Would Moroccan law apply to the Spanish retiree who moves their residence to the beaches of Agadir and dies there? Would Chinese law apply to the succession of an executive posted to China for work reasons for several years? And would German law apply to the grandfather taken in during his final illness by his daughter resident in Germany? And would the laws of the American state where he resided apply to the young researcher based in the USA who dies suddenly without a will?
Until the entry into force of EU Regulation No 650/2012 (last 17 August 2015) a Spanish citizen, or a foreigner in Spain, knew that their own national law would govern the fate of their assets when they died. The experiences lived with their parents and grandparents usually had value and served as a reference. This recourse is no longer prudent; consulting an expert is now necessary.
In the same way, those who reasonably expect to inherit – the spouse, children or grandchildren – would do well not to be complacent and to ask whether a change of residence by the person whose succession it is could alter things.
Making a will
The good news is that, if one wishes to return to the known, and therefore safer, situation of Spanish law (in the case of Spaniards), it will suffice to make a will solemnly declaring that Spanish law is to govern the succession of the person making the will. EU Regulation No 650/2012 allows the testator to choose their own national law as the law applicable to the succession.
We should also be grateful that the new rules have fully respected wills made before 17 August 2015, which will be understood to be validly governed by the law of the testator’s nationality. So anyone who made a will before 17 August 2015 need not worry as long as they do not change it.
Nor do Spaniards who can categorically state that they will not move their residence abroad in the future need to worry especially. As long as they continue to reside in Spain, Spanish law will determine their succession.
On the other hand, all foreigners who have their habitual residence in Spain should start thinking about visiting the notary to consult whether it suits them to let Spanish law govern their succession or whether it is better for them to make a will providing that their own national law (French, German, Moroccan, etc.) governs their succession.
For the same reason, Spaniards residing abroad should also consult their trusted notary or lawyer.
Advantages of Spanish law
The advantages for the Spanish testator who chooses Spanish law for their succession can also extend to ensuring that a Spanish authority (notary or court) decides their entire succession, even though that Spaniard was residing abroad when they died.
In principle, under EU Regulation No 650/2012, the succession of Spaniards habitually resident in other EU Member States will be legalised and decided as a whole by the authorities of the foreign country where the deceased resided (with the exception of the United Kingdom, Ireland and Denmark, which do not apply the regulation).
By exception, and only in respect of successions where the Spanish testator has chosen Spanish law, the foreign authorities of the EU Member State where the deceased resided will be obliged to decline jurisdiction and let the Spanish authorities decide on the succession if all the heirs, forced heirs and persons interested in the inheritance agree that a Spanish authority should legalise the succession.
Even in the absence of such agreement among all those interested in the inheritance (provided that the testator has chosen Spanish law), the foreign authority may decline jurisdiction in favour of the Spanish authority if there are practical circumstances that advise it, such as that most of the assets of the inheritance are in Spain or that the beneficiaries of the inheritance reside in Spain.
Taken from: http://www.expansion.com/juridico/opinion/2016/01/12/56953e8722601de55d8b461e.html