There is little doubt that the Iberian market, in particular private equity, is rocketing. While historically the corporate market has focused on mid-cap transactions, the past 12 months have witnessed a surge in mega-deals, such as Cortefiel,Auna and Amadeus Global Travel.

Research by the Association of Risk Capital Groups in Madrid shows that the total value of buyouts and investments in Spain during 2004 rose by a staggering 50 per cent on the previous year to €2bn (£1.37bn).

The smart money is on 2005 smashing this again, and firms such as Clifford Chance, Cuatrecasas and Linklaters have all bolstered their local presences in preparation. Strict rules governing financial assistance have not slowed the buoyant market, although the growing complexity of transactions is fuelling the need for greater legal clarity. This Iberian special report weighs up these issues. It also examines the legal doubt surrounding working relationships between lawyers and firms, and uncertainty over the apportion of liability within the local construction industry.