A toy store faces financial problems because sales have dropped dramatically. Months go by and the situation becomes unsustainable, causing tensions among the partners. Finally, after several attempts to turn the business around, the company files bankruptcy.
Up to this point, we could be talking about one of many stories in which commercial law would come into play to dissolve the company and oversee the liquidation process with suppliers, partners, or the fulfillment of obligations. In Guatemala’s case, an Insolvency Law was approved in 2022, that would help companies reorganize and preserve their value in the event of a financially challenging situation, but has not come into force because the Regulations haven’t been published.
Just as in a toy store, this situation could arise in any other industry or business, and the partners would have to talk, negotiate, and find a way out. However, things could escalate if one partner files a civil lawsuit against another, alleging that the other’s mismanagement or negligence in decision-making brought them to this position and, therefore, demanding payment for damages.
Ideally, the partnership agreement should include a dispute resolution clause, and it should be honored. But partners will always have the right to sue, and agreements are not always respected. Another point to consider is that settling a legal dispute in civil court is not the same as filing a criminal complaint. If one of the parties takes the conflict to that arena, the situation changes completely.
The Last Resort: Criminal Proceedings
Although it is not the norm, it is a reality that in commercial disputes, criminal law is sometimes maliciously used to pressure a partner and push them to the limit. It is important to bear in mind that, from the moment a complaint is accepted for investigation or when a person is implicated in criminal proceedings, years may pass during which the accused will face constant pressure on their finances, reputation, and even their freedom.
Applying this to the hypothetical toy store case, one partner might accuse the other of taking out loans for personal gain or tampering with the accounting records to conceal the company’s true financial situation. The goal would be to reclassify a standard bankruptcy as fraudulent or culpable, crimes that are defined in the Guatemalan Penal Code.
But in such a situation, there is something fundamental to keep in mind. If the scenario described were to occur and it were proven that the complaint was filed in bad faith—without any basis or evidence—the complainant could end up being charged with crimes such as commercial defamation, slander, filing a false complaint, or falsely reporting a crime.
When we discuss commercial cases that lead to criminal consequences, we can say that these essentially arise from commercial relationships or certain criminal acts that occur within a company or a commercial entity.
Here we have examined a hypothetical situation that could occur—and, in fact, does occur. But that does not mean that any conflict with a supplier or partner can or should be resolved through criminal proceedings. In fact, in most cases, these will be matters discussed within the company or addressed through civil proceedings when personal liabilities related to assets are at stake.
On the other hand, it should be noted that to resolve disputes arising within a company, governing bodies and regulations are established to oversee decision-making, the participation and the responsibilities of each partner. Furthermore, as a preventive measure, indemnification clauses can be included in contracts, or the use of Alternative Dispute Resolution (ADR) methods can be institutionalized to resolve differences among partners without severing ties.
Criminal proceedings may legitimately arise in the context of a commercial dispute, but precisely because criminal law is coercive, repressive, and punitive, it should be limited to addressing criminal conduct—excluding bad faith—and not used to exert pressure or push a situation to the limit.
If you have any questions or concerns, please do not hesitate to contact us.
Published on July 13, 2026.