From:
https://help.iberia.com/user_questio...n-time-madrid/
"Transfer Luggage" is defined as checked-in luggage which has to travel on two or more connecting flights and therefore must be transferred from one aircraft to another. Iberia permits passenger and luggage check-in during transfers (between Iberia flights) on both single tickets and separate Iberia tickets. Passenger and/or luggage check-in during transfers with separate tickets from other companies, between Iberia and other companies in the OneworldAlliance, and between Iberia and the companies it has code share agreements with are also allowed, so long as the passenger can prove he or she has an ongoing ticket and meets the Minimum Connecting Time in the stopover or transfer airport. Passengers will be advised at the airport of origin regarding where they should collect their luggage.