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Procedures for the incorporation of a commercial company in Spain by shareholders of other nationalities



On many occasions, clients from the UK ask Lopez & Moreno Associates for advice on the incorporation of Spanish commercial companies. In this article, we intend to summarise the basic steps and procedures required for the incorporation of a limited liability company in Spain, this corporate form being the most common in Spain. Likewise, we will make special reference to the particularities required by Spanish regulations when the shareholders or directors of the company are not Spanish nationals.


Previous procedures before the Spanish tax authority, State Tax Administration Agency (AEAT). Application for Spanish Tax Number (NIE/NIF).


First of all, before starting any procedure related to the signature of the Deed of Incorporation of the company before a notary in Spain or before our notary in the City of London, it is necessary to foresee which people or entities will participate as a shareholders or, where appropriate, as director in the new company.


Thus, currently the Spanish Tax Administration Agency (AEAT), in the event that a foreign entity wishes to establish or participate in the capital of a Spanish commercial company, it will be necessary for both some of its representatives as well as the foreign company itself to obtain the relevant Spanish Tax Number (‘N.I.F.’ for companies / ‘N.I.E.’ for individuals).


These persons and entities will need to obtain a Spanish tax identification number (N.I.F./N.I.E.) if they do not already have it. At Lopez & Moreno Associates we can help with both applications N.I.E. and N.I.F. For an application for a Spanish Tax Number ((‘N.I.F.’) for a company it will be necessary to provide the following documentation:

 

1) Identity documentation of the applicant when an individual, where applicable, of the representatives of the applicant when a company (normally a valid passport).

 

2) Registration documentation. In the event that the applicant is a foreign company, it is necessary to provide documentation proving its registration, directors, good standing, etc. in the relevant commercial registry of its country of origin.

 

3) Power of Attorney in favour of the people who must carry out the NIF/NIE application process.

 

4) Form 036. This form must be submitted duly completed for the applicant to obtain the relevant Spanish Tax Number for a company (‘N.I.F.’).


All the aforementioned documentation, if referring to foreign individuals or companies, must be provided, duly translated into Spanish and legalised with the Hague Apostille.


For further information and fees, please get in touch with us and our team of Spanish lawyers and notary will be happy to assist.


Obtaining a negative certificate of company name issued by the Central Commercial Registry


Once the requirement of obtaining the necessary Spanish Tax Number (N.I.F./N.I.E.) for the shareholders and the directors of the Spanish company has been met, depending on the case, the next step is to obtain a negative certificate of corporate name that will need to be provided to the notary when granting the Deed of Incorporation of the future Spanish company. This certificate is requested at the Central Commercial Registry, through an application that includes the consultation of up to 5 possible company names in order of preference. Thus, in the event that the first requested company name matches with one already registered, the Registry will consider the next one and so on following the order established in the application.


Finally, the Central Registry, if applicable, issues a certificate that grants the applicant a "reservation" of the company name that is available. Said reservation is granted for a maximum of 6 months, however the first certificate issued will be valid for three months, so, in the event that at deed of incorporation of the Spanish company is not granted during such 3 months, the certificate of company name must be renewed for a further three months.


Opening an account in a Spanish bank in the name of the new company


In order to be able to deposit the initial share capital legally required depending on the type of commercial company (3,000 Euros in the case of a limited liability company), it is necessary to contact a bank in Spain and open an account where to deposit the share capital of the new company. In relation to said deposit, it is necessary for the bank to issue a certificate proving the deposit of the funds. This certificate must subsequently be presented to the notary at the time of granting the deed of incorporation of the Spanish company. If there is any reason for urgency, this procedure could be postponed until after the public deed of incorporation has been granted.


Granting of deed of incorporation before a notary


Once the above mentioned requirements have been completed, it is necessary to grant a Deed of Incorporation of the Spanish company before a notary.


In order to grant the deed of incorporation of the company, it is necessary to provide the notary with the following documents:


1) Identification documentation of the initial shareholders granting the deed of incorporation including their Spanish Tax Numbers (‘N.I.F./N.I.E.’). If the shareholders do not attend personally the notary to sign the Deed of Incorporation of the Spanish company, they must grant a Spanish style Power of Attorney.


2) Negative certification of the company name previously obtained from the Central Commercial Registry.


3) Bank certificate in evidence of the deposit in a bank account in Spain on the name of the newly created Spanish company of the share capital legally required for the constitution of the company.


4) In the event that the shareholders of the Spanish company were other companies, a Spanish style Deed of Declaration of Beneficial Ownership of the shareholder must be provided in compliance with the regulations on the prevention of money laundering and of the financing of terrorism.


5) In the event that the shareholders are non-resident in Spain, whether if they are individuals or companies, it will also be necessary to file the relevant forms with thye declaration of foreign investment in companies before the Ministry of Industry, Commerce and Tourism of Spain. The said declaration is made electronically and is signed electronically by the notary granting the deed of incorporation of the company.


Necessary information in relation to the new company and Articles of Association


In addition to the documentation previously mentioned, the initial shareholders of the new Spanish company must agree among themselves and indicate to the notary certain characteristics related to the structure, organisation and internal functioning of the company; mainly: the management structure of the company (sole director, joint or several directors or board of directors), identification of directors or members of the board who are initially named at the time of the company's incorporation, etc.


Likewise, among the information that must be stated in the Articles of Association is the corporate purpose that the new company, the initial share capital (which will be the one recorded in the aforementioned bank certificate), the registered office, management structure, etc.


The above information must be stated in the Articles of Association, as well as other issues related to the organisation and governance of the company, such as issues related to calls, holding meetings of the company's governing bodies, majorities necessary for passing shareholders’ resolutions, rules for the transfer of company shares and other issues that must be taken into account after the analysis of each specific case.


Obtaining the Tax Number (‘N.I.F.’) of the new company


After granting the deed of incorporation of the new company, it is necessary to proceed with the request for the tax identification number N.I.F. of the new company before the Spanish tax authority AEAT. This is a mandatory requirement before proceeding to register the deed of incorporation of the company at the relevant Commercial Registry in Spain of the province where the registered office of the company is located.


Spanish Stamp Duty Tax


Currently, the incorporation of commercial companies is subject to Spanish Stamp Duty Tax, although it is currently exempt from any tax. Therefore, the relevant Spanish Stamp Duty Tax Form must be submitted to the relevant Tax Office as exempt from Spanish Stamp Duty Tax.


The prescribed period to file such Stamp Duty Tax Form is 30 days from the date when the deed of incorporation of the company is signed before the notary.


Registration at the Commercial Registry


The last phase of the process of incorporation of a commercial company in Spain is the registration of the Deed of Incorporation at the relevant Commercial Registry of the province where the registered office of the new company is located.


It is necessary to show evidence of the Spanish Tax Number (‘N.I.F.’) of the new company and the relevant Spanish Stamp Duty Tax Form sealed by the relevant Tax Office.


The Commercial Registry of the of the province where the registered office of the new company is located will peruse the deed of incorporation and, where appropriate, will carry out the relevant registration, at which time the company will be fully incorporated and will be able to begin its commercial activity.


Please do not hesitate to get in touch with us if you need assistance with incorporating a company in Spain and at Lopez & Moreno Associates we will guide you through the process.

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