- 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
4. Main Characteristics of Corporations and Limited Liability Companies
4.4 Types of shares
4.4.1 Types of shares at a corporation
A distinction can be made between the following share categories:
|Registered vs. bearer shares||The shares of an S.A. can be registered shares (the holder is the person designated in the certificate) or bearer shares (the holder is the bearer of the certificate). However, the shares must be registered in the following cases:
|Common vs. preferred stock||Preferred stock may be created as a separate class or classes pursuant to the same procedural formalities applicable to bylaw amendments (i.e. quorum and voting requirements and method of calling the shareholders’ meeting), and may include shares entitled to a preferential dividend.
In any event, issues of shares will not be valid in the following cases:
|Shares issued with a premium||Shares may be issued with a premium payable to the company above their par value. In such cases the premium must be fully paid in upon subscription of the shares.|
|Non-voting stock||Non-voting stock may be issued for a total par value that does not exceed one-half of the total paid-in capital.
The special rights attached to non-voting stock are as follows:
However, under certain exceptional circumstances, holders of non-voting shares may acquire a transitional right to vote at shareholders’ meetings. Two examples follow:
|Redeemable shares||Redeemable shares are a type of preferred shares at listed companies, subject at all times to various terms and conditions.
Redeemable shares are those whose redemption or full or partial purchase by the issuer or by third parties is fixed in time or released at the discretion of the shareholder, according to the conditions of the issue; or those whose redemption or full or partial purchase by the issuer or by third parties is undertaken in any other manner, excluding that detailed above.
|Shares with ancillary obligations||An ancillary obligation is an obligation to perform or refrain from performing certain acts. Ancillary obligations do not form part of the capital stock of the company.
The shares of an S.A. can only be paid for with money or assets and not with work or services. The ancillary obligation is a device whereby the work, services or other obligations of individual shareholders can be tied to the corporation.
4.4.2 Share certificates
In general, shares of an S.A. may either be issued physically as certificates or recorded by a book-entry system. The conditions for recording shares under a book-entry system and the regulations governing this system are set out in the Revised Securities Market Law (Legislative Royal Decree 4/2015, of October 23, approving the Revised Securities Market Law), and its various legislative amendments.