- 1Spain: An attractive country for investment
- 2Setting up a business in Spain
- 3 Tax System
- 4 Investment aid and incentives in Spain
- 5 Labor and social security regulations
- 6 Intellectual property law
- 7Legal framework and tax implications of e-commerce in Spain
- AI Annex I Company and Commercial Law
- AIIAnnex II The Spanish financial system
- AIIIAnnex IIIAccounting and audit issues
- Different ways of doing business in Spain
- Tax Identification Number (N.I.F.) and Foreigner Identity Number (N.I.E.)
- N.I.E for individuals who are to be shareholders or directors of companies resident in Spain, tax and legal representatives of a branch in Spain, permanent establishments or limited liability entrepreneurs
- N.I.F. for legal entities that are to be shareholders or directors of companies resident in Spain, or owners of branches in Spain or permanent establishments
- Provisional and definitive N.I.F. of the company resident in Spain that is to be set up
- Formation of a company
- Limited liability entrepreneur
- Opening of a branch
- Other alternatives for operating in Spain
- Forms of business cooperation
- Temporary Business Associations (UTEs)
- Economic Interest Groupings (EIGs)
- Silent participation Agreement (C.E.P.)
- Participating loans
- Joint ventures through Spanish corporations or limited liability companies
- Distribution, agency, commission agency and franchising agreements
- Other alternatives for investing in Spain
- Dispute resolution
- Appendix I - Table summarizing the tax treatment given to the various ways of investing in Spain
6Opening of a branch
6.1. Legal steps and costs
|1. Clear name search certificate||Same procedure followed as for a company. However, according to the decision of the Directorate-General of Registries and the Notarial Profession (DGRN) of May 24, 2007, foreign companies do not have to obtain a clear name search certificate from the Central Commercial Registry in order to set up a branch in Spain.|
|2. Obtainment of the N.I.F. and appointment of the representative of the parent company in dealings with the Spanish tax authorities||Same procedure followed as for a company.
Appointment of an individual or legal entity residing in Spain to represent the parent company in dealings with the Spanish tax authorities regarding its tax obligations.
|3. Document containing representations by the beneficial owner||Same procedure followed as for a company.|
|4. Execution of the deed recording the opening of a branch before a Spanish notary||This step consists of the public formalization before a notary of the resolution to open a branch previously adopted by the competent body of the foreign parent company.
The notary will request (i) documentation similar to that required for a subsidiary (that is, evidence of the identity of the person who appears before him, his power of attorney to represent the parent company, declaration of the beneficial owner, evidence of payment and whether it is to be made in cash or in kind (if applicable); (ii) sufficient proof (translated, legalized and/or certified by apostille, as appropriate) of the existence of the parent company, its bylaws and the names and personal details of its directors; and (ii) the resolution to form the branch adopted by the competent body of the parent company.
The deed may also contain the subsequent declaration of foreign investment to the Register of Foreign Investment of the Directorate-General for International Trade and Investments (DGCI) of the Ministry of Industry, Trade and Tourism. In some cases, as with subsidiaries, prior declaration is required (see Chapter 1, section 8 for further information).
|5. Application for registration at the Commercial Registry||Same procedure followed as for a company.|
|6. Opening formalities||Registration for the purposes of the Tax on Economic Activities: Same procedure followed as for a company.
Registration for the purposes of Value Added Tax (VAT): Same procedure followed as for a company. Payment of the charge for processing of the opening/operating license or solemn declaration: same procedure followed as for a company27.
Registration for Spanish social security purposes: (See Chapter 5, section 13 for further information).
As a general rule, setting up a branch takes between 6 and 8 weeks.
27In accordance with the provisions of Law 12/2012 on Urgent Measures to Deregulate Trade and Certain Services, permanent establishments used for commercial retail purposes and the provision of certain services provided for in the Schedule to the Law with a useful sales and display area not to exceed 750 m2 will not generally be required to obtain an opening and operating license beforehand, but rather to submit a solemn declaration or prior communication. However, the establishment of a large retail outlet requires the prior obtainment of authorization from the competent body of the regional government.