How to register your own company in Spain

The bureaucracy surrounding the creation of a new business is always a major challenge, particularly when doing so in a legal system you are not too familiar with. In this post you will find an outline of the process you will need to follow in order to register a company in Spain. Hopefully, a clear explanation makes everything a little bit easier, allowing you to avoid future problems and making sure you can focus on what’s really important: running your new business.

There are several options available when deciding to create a company in Spain. In this post we are going to focus on how to create and legally register a limited company (Sociedad Limitada) because it is the simplest and most common structure for a company in Spain.

Without further ado, these are the steps you need to follow in order to legally register a limited company in Spain:

  1. Get a Spanish Identification Number, or NIE

NIE stands for “Número de Identificación de Extranjeros,” in other words: it links your Passport to a unique ID number for tax purposes within Spain. This is the very first step you will need to complete before participating in any type of administrative procedures, whether public or private. The nationals’ equivalent for this is the NIF, which stands for “Número de Identificación Fiscal.”

There are two ways in which you can obtain this number:

  • From any Spanish consulate in your country of origin;
  • In the designated police stations, either in person or by granting a Power of Attorney.
  1. Name your Company

The following step is to obtain a certificate of uniqueness, or “Certificación Negativa de Denominación Social,” for the name you wish to give your company. In order to do so you must send a list of three possible names by order of preference to the Central Corporate Register of Spain, or “Registro Mercantil Central”.

Within a few days, the Register will either decline your request if the names are already in use, in which case you will need to submit three alternative options, or issue a certificate granting your company its official, unique name out of the list you submitted.

  1. Deposit the Minimum Cash Requirement

Having an NIE, you will now be able to open a Bank Account that is linked exclusively to your business. This is necessary because, in order to register a limited company, you will need to obtain a certificate from your bank showing that there is at least 3,000€ under the company’s name. You will see that this certificate is often referred to as “Certificado de Depósito de Aportaciones Dinerarias.”

  1. Draft the Shareholder Agreement

This Agreement is the main internal governing document and the Spanish equivalent to what in the UK is known as Memorandum and Articles of Association.  It must, at least, answer the following questions:

  • Where is the company located, or its “Domicilio Social”?
  • What is the purpose of the company, or its “Objeto Social”?
  • Who are the shareholders of the company and what are their voting rights?
  • What is the initial invested capital?
  • Who is the company’s Director?

    This document is binding for all the shareholders. Any other points regarding the structure and functioning of the company can (and should) be a part of the agreement but can also be attached to the main agreement later.

    The drafting of this Agreement is probably the most complex step in the procedure, which is why the assistance of a business lawyer is highly recommended. It is very important for this Agreement to be part of the solution and not the cause of any problems that could arise in the future. In Nalda & Suárez we have more than 30 years of experience in registering companies and we would be more than happy to guide you along the whole process or to just assist you in the drafting of the Shareholders Agreement, or “Estatutos Sociales.”

    1. Sign the Public Deed

    This step just puts together and formalizes all the previous ones. At the Notary’s office, the shareholders (or a representative through Power of Attorney), will sign the Public Deed of Incorporation, or “Otorgamiento de Escritura Pública”, which will include: the NIE number, the Bank Certificate, the Name Certificate and the Shareholder Agreement.

    1. Get an Identification Code for your Company, or CIF

    CIF stands for “Código de Identificación Fiscal” and its purpose is to identify your company for tax purposes.

    In order to obtain this number, you will need to fill in the corresponding application form and upload it or present it in your local tax agency, together with your NIE. You will first be given a temporary one. The final one is issued at the end of the process.

    1. Pay the applicable taxes

    Before submitting the Public Deed to the Register, you must pay a tax known as “Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos Documentados” which amounts to 1% of the company’s initial invested capital.

    1. Register your company

    Once the taxes have been paid, the Notary will then send the Public Deed to the Companies Register, or “Registro Mercantil,” which is the Government’s body in charge of controlling that the Public Deed complies with all the necessary legal aspects. Congratulations: once this is complete you will receive your final CIF and your company will be fully registered.

    We hope that this guide can help you navigate the process of registering a new company in Spain. If you wish to do so in Valencia, in Nalda & Suárez Abogados we will be more than happy to guide you through the whole process and/or answer any questions that you might have.

    Contact us at: info@naldaysuarezabogados.es or give us a call us on 963 31 81 13.

    Post by: Elena de Nalda Tárrega

    The European order for payment procedure: opportunities and threats

    It is no longer news that current personal and commercial relations know no national borders. Consequently, the internationalisation of the legal proceedings resulting from such transnational relations cannot come as a surprise. Given this scenario, it is essential to adapt our tools and behaviour to procedures that were not available up until a few years ago, or that were initially hardly applied.

    In this post we briefly explain what the European Order for Payment (EOP) Procedure consists of and how to use it; how it benefits the creditor, but above all, what the risks of this instrument are for the debtor and how to mitigate them.

    What is it and how does it work?

    The EOP Procedure is applicable in civil and commercial matters (with some exceptions), and it enables creditors to claim due debts, in cases where the parties reside in different countries of the European Union.

    The procedure is initiated at the request of the creditor, before the competent court, with the presentation of a standard form, in which the claim must be substantiated, and the amount owed detailed. Once the court receiving the claim examines it and if the admissibility requirements are met, it will issue a European Order for Payment so that the debtor, within 30 days, either fulfils the payment or lodges a statement of opposition.

    Opportunities enabled by the EOP Procedure

    As is the case with the Spanish internal order for payment procedure (proceso monitorio), if the defendant neither pays nor objects to the EOP within the given time limit, it becomes enforceable automatically. The great advantage of this in the European procedure is that the enforcement is handled by the competent court at the place where enforcement is to take place in accordance with the rules applicable there. Thus, the order for payment is enforced as if it were a domestic judgment, even though it takes place in a different country to that of the plaintiff. In comparison to other international proceedings and/or proceedings with a foreign element, the EOP Procedure is therefore simpler and more efficient.

    The second major advantage of this procedure is that, in many cases it is possible to file the claim in the court of the claimant’s jurisdiction, which facilitates the operation greatly.

    Threats to be taken into consideration

    However, it is precisely this speed or automaticity of enforcement that can put you on the back foot if in the debtor’s position. As mentioned in the previous paragraph, this factor is common to the internal order for payment procedure in Spain. However, it is the foreign element that should, in this case, lead to extreme care being taken to ensure that the deadline does not pass without an opposition to the order being lodged, since this would allow the court to dictate a directly enforceable decision.

    Although in principle an EOP should be served in the same way as an ordinary internal legal notice, there is the possibility of receiving types of notices that we are not familiar with, as well as in other languages or in formats that, due ignorance, are sometimes missed because we do not know exactly what they are about. For this reason, it is essential to contact a law professional the moment we receive a notification of any kind or in any language that mentions a debt or legal proceeding, even if, apparently, it does not seem like it could affect us. In this respect, it is also of utmost importance not to reply to such notices, letters or e-mails without professional advice, as certain replies could be considered as a tacit agreement to some of the issues included in the notice.

    In conclusion, the EOP Procedure is a very useful tool that can make it easier for a creditor to recover a debt of foreign origin within the EU. However, and for this very reason, it is essential to be attentive to notifications from other countries or in other languages, as the effects of a European Order for Payment can be immediate. It is therefore important to have a team of professionals capable of responding quickly and efficiently to these situations.

    At Nalda & Suárez Abogados we are experts in litigation for non-payment, both nationally and internationally. In addition, we have previous and very successful experience in EOP proceedings. If you would like to know more about this subject, do not hesitate to write to us at: info@naldaysuarezabogados.es or call us on 963 31 81 13. We will be delighted to help you.

    Post written by: Elena de Nalda Tárrega

    Estamos aquí para ofrecerte la asistencia legal que necesitas

    Ponte en contacto con nosotros para una consulta