Procedures for setting up a limited company in Spain (S.L.)

1. Negative company name certificate.

This certifies that the company name chosen does not coincide with that of any other existing company.

The name is reserved for a period of six months. The certificate remains valid for three months however, although it is renewable. It must be shown to the notary public when signing the deed of incorporation.

Central Companies Register.

2. Opening of a current account and request for a bank deposit certificate indicating the start-up capital.

To deposit the minimum start-up capital and certify as such before the notary public when signing the deed of incorporation.

3. Obtaining the Foreigner’s Identification Number (NIE).

Necessary to be considered a partner or director in a Spanish company.

Any Provincial Government Office or

Spanish consulate / embassy.

4. Drafting of the company by-laws.

These establish the essential rules for company operations.

5. Granting of powers.

A document in which the partner who may be unable to attend the signing of the deed of incorporation of the company before the notary public authorises another person to appear on his/her behalf.

This can also be granted abroad with the inclusion of the 1961 Hague Convention Apostille (stamp making the power granted abroad effective in Spain).

6. Granting of the deed of incorporation of the company.

This is when the partners or their representatives appear before a notary public to formally constitute the company.

7. Declaration or authorisation of the investment in the Foreign Investment Register.

This is for administrative and economic purposes (Government control on the source of investments made).

Ministry of the Treasury Foreign Investment Register.

Term: during the month following the granting of the deed of incorporation (date of the investment). This is nowadays filed on a telematics basis.

8. Census declaration

• Obtaining a provisional Tax Identification Code (CIF).

• Registration for the following taxes:

- Value added tax (IVA),

- Corporate income tax (IS),

- Business tax (IAE).

Presentation of the official form (036) to obtain the provisional CIF, which identifies the company for tax purposes and informs the Authorities of the start of company activity.

Automatic registration for taxes simply by presenting the 036 form.

Newly created companies are exempt from payment of IAE during the first two years of business. They are then only subject to payment as of a certain turnover.

Office of the Inland Revenue corresponding to the tax domicile of the company.

Term: prior to the start of business.

9. Presentation of form 600.  (Transfer tax - ITP - and stamp duty - AJD - exempt).

Currently exempt from payment of taxes.

Required for listing of the company in the Companies Register.

Regional Tax Authorities.

Term: within 30 calendar days following granting of the deed of incorporation of the company.

10. Listing in the Companies Register.

Makes company constitution public so that it can acquire legal status.

Companies Register corresponding to the company address.

11. Obtaining of the corresponding administrative permits, authorisations and registers.

Varies according to the type of business activity.

Public authorities (regional and local).

Term: before starting business.

12. In the case of employees:

• Company listing with the Social Security.

• Registration and membership of employees with Social Security.

The company must be listed with the Social Security for its employees to be registered (form TA-6). Once the company has been listed, the employees should register using the RED System.

Provincial Department of Social Security corresponding to the registered offices of the company.

Term for registering the company and the first employee: before the first contract of employment is signed by the employee and he/she starts to work for the company.

Term for registering remaining employees: Before employees are appointed.

13. Notification of the opening of a workplace

Notification to the appropriate labour authorities of the start of a new business of any kind, regardless of whether or not the company appoints employees provided that there is a workplace.

The appropriate labour authorities.

Term: 30 days after the workplace has opened.

14. Obtaining of the final tax identification code (CIF)

Obtaining of the final CIF card to prevent the previously requested provisional card from expiring.

Any office of the Inland Revenue corresponding to the tax domicile of the company.

Term: six months following the issue of the provisional card (Procedure 8).

15. Legalisation of company books.

There are four books: the Journal, the Inventory and Annual Accounts Book, the Minutes Book and, in the case of a sole partner, the Register of Contracts with the Sole Partner.

Companies Register corresponding to the registered office of the company.