COMPANY INCORPORATION IN SPAIN
Which types of commercial companies can be incorporated under the Spanish Law?
There are four main types of mercantile companies in Spain, which are: The stock corporation (sociedades anónimas), the limited liability company (Sociedad limitada) , the general partnership ( Sociedad colectiva) and the limited partnership (sociedad comanditaria) . However, there are also other special types of special commercial companies.
It is very important to decide which of the companies best suits the needs of your business, because the future of the company will depend on the chosen company.
What is the responsibility of the partners in each case?
The limited liability company is the most common in Spain, this is because in this type of company the entrepreneur does not have to respond with his own patrimony to the debts generated by the company, and therefore the liability is limited to the company capital.
The minimum capital to incorporate this company is 3,000 euros, amount which is divided into participations according to the contribution of each partnet. It is allowed that the company share capital is owned only by one partner.
The Stock corporation, its capital is divided into shares, which are freely transferable, unlike the shares of a private limited company. The liability of each shareholder is proportional to the capital contributed. A minimum of 60,000 euros is required for the company incorporation, which needs to be paid up to a minimum of 25% at the time of the public deed of company incorporation.
The general partnership is a type of partnership of a personal nature, since the partners not only contribute with capital (founds) but also with work and manage the company, so that the status of partner is not freely transferable. The liability of the partners is unlimited, so the partners are liable for the company’s debts with their personal assets. In this type of company there is also the figure of the industrial partner, who only contributes with work.
The limited Partnership, this type of partnership is similar to the general partnership, but some of the partners are not involved in the direct management of the company.
Basic steps to incorporate a limited liability company in Spain.
Firstly, apply for a negative certification of a company name, to check with the Commercial Register to ensure that the chosen company name is available.
Once the name certification is obtained, a bank account is then opened in the name of the company to be incorporated and the minimum share capital established for the type of company to be formed must be transferred to such account by the founding partners.
The articles of association shall be drawn up in accordance with the needs of the partners. The articles of association must contain the corporate purpose of the company, the address of the registered office, the description of the management body organization and its remuneration, among further regulations.
The company directors will then be appointed, depending on the type of company chosen. Once the company is incorporated, it must be registered before the tax authorities in order to pay the corresponding taxes, and in the event that it wishes to hire employees, it must be registered before the social security authorities.
The deed of incorporation is then executed in the presence of a notary, then a provisional tax identification number can be obtained. In order to execute the deed of incorporation of the company, the notary must be provided with the ID card of the shareholders, the negative certificate of the company name issued by the registry, the certificate of the deposit of the capital in the bank and the articles of association.
Time related to the company incorporation in Spain.
According to data provided by the European Union, in Spain it takes on average 13 days to incorporate a limited liability company.
If you are interested in incorporating a company in Spain, please do not hesitate to contact us: info@kaplanlegal.es