In its judgment 424/2016 of June 27, 2016, the Supreme Court confirms its doctrine on the nature and legal regime of comfort letters (also known as sponsorship letters). 

The Supreme Court upholds that a “strong” comfort letter implies a unilateral business structure with emphasis on obligation, aimed at establishing a relationship of obligation. This obligational effectiveness is subject to the letter clearly and unequivocally stating the obligational commitment (in terms of its content and other aspects, including duration) and that the creditor expressly or tacitly accepts it. 

In this case, it is also considered important, when obligational effectiveness is being granted, that both sponsors acknowledge that the commitment established in the sponsorship letters was decisive for carrying out the sponsored financing transaction and that the sponsors controlled and managed the financed and sponsored party in their capacity as majority shareholders of the latter (not parent company).

The court confirms that both sponsors are jointly and severally liable given the decisive nature of the letters for the credit transaction considered as a whole and with the clear purpose of ensuring the proper closing of the transaction.