- 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
- Applicable Legislation
- Forms of Business Enterprise
- The Treatment of Liability at the types of Business Enterprises
- Main Characteristics of Corporations and Limited Liability Companies
- European Public Limited-Liability Company (S.E.)
- New Limited Liability Company
- Professional Services Firm (S.P.)
- Sole-Shareholder Companies
- Representative Office
2. Forms of Business Enterprise
Spanish law envisages various different kinds of business enterprises, all of which can be used by foreign investors.
The most significant are:
- Corporation (Sociedad Anónima, abbreviated as "S.A.").
- European Public Limited-Liability Company (Sociedad Anónima Europea, abbreviated as "S.E."). Possibility offered by EU legislation to companies that operate in various Member States to create a single company capable of operating in the EU in accordance with a single set of rules and a unified management system.
- Limited Liability Company (Sociedad de Responsabilidad Limitada, abbreviated as "S.L." or "S.R.L.").
- New Limited Liability Company ("Sociedad Limitada Nueva Empresa" abbreviated as "S.L.N.E."), a variation on the S.L. specially intended for small and medium-sized companies that simplifies the requirements for its formation.
- General Partnership (Sociedad Regular Colectiva, abbreviated as "S.R.C." or "S.C.").
- Limited Partnership (Sociedad en Comandita, abbreviated as "S. en Com." Or "S. Com.") or Limited Partnership by Shares (Sociedad en Comandita por Acciones, abbreviated as "S. Com. p. A.").
- Professional Services Firm ("Sociedad Profesional", abbreviated as "S.P.")1, the purpose of which is the common pursuit of an activity regulated by professional association, and which may be formed in accordance with any of the corporate forms legally established under their specific legislative provisions.
The corporation (S.A.), which is the archetypal trading company and has traditionally been the most commonly used form, has become less popular and today the limited liability company (S.L.) is the most common form of trading company. The reasons for this include the fact that a limited liability company requires less capital than an S.A. However, the limited partnership and the general partnership forms are hardly used at all.
Some of the salient features of each of the above corporate forms are summarized below. It should be noted that in many instances the Law provides only minimum standards or general rules. The founders of a company have a great deal of flexibility when it comes to tailoring the structure of the company to their specific needs through the inclusion of certain clauses in the bylaws, for which they should seek the appropriate legal advice.
1 The corporate name of this kind of firm should include, together with the corporate form in question, the expression "Professional" or the abbreviation "P", (for example, Sociedad anónima profesional [Professional corporation] or "S.A.P.").