• Hypermotion

Cities of Innovation: Bilbao

How to set up a business: a quickfire guide

What are my options?

The choice of entity for entrepreneurs or subsidiaries of foreign companies that wish to operate in Spain with limited liability for shareholders is either the Limited Liability Company (SL) or a Public Limited Company (SA).

 

Requirements/steps for incorporation for both are:

a. Apply for a corporate name for the new company.

b. Open a bank account for the new company.

c. Draft by-laws.

d. Appoint Directors.

e. Sign the incorporation before a Public Notary.

f. Register the new company with the Commercial Registry.

g. Obtain regulatory approvals for certain activities if needed.

h. Grant a Power of Attorney to local legal advisors to carry out the necessary steps if the shareholders are not going to be present at the incorporation.

What do I need to set up a company?

— The minimum share capital required for an SL is €3,000 and for an SA it is €60,000.

 

— Public Notary and Commercial Register fees are between €500 and €1,000 (and accounting and legal advisory fees will be charged on top).

 

Foreign individuals/directors must obtain a foreign identification number (known as a NIE) and foreign companies seeking to set up a branch must get a local fiscal number (a NIF).

 

Time needed for the registration procedure
This depends on the structure chosen. An estimated timescale would be as follows:

a. 15-30 calendar days to obtain a NIE/NIF.

b. 7-10 working days for the company to be incorporated before a Public Notary.

c. 15 working days (from incorporation) for registration although the company can trade as soon as it is incorporated.

 

Entrepreneurs need to be aware of the following requirements after registration:

a. Accounting and payroll obligations.

b. Tax procedures (VAT and Tax on Economic Activities).

c. Occupational procedures (eg registration of the company for social security and employee insurance).

 

In addition, the company founders may have to file a declaration of ultimate beneficial owner (25% of share capital) at incorporation and a declaration relating to the origin of funds may be required depending on the country from where the company is funded.

Tax rates

A reduced tax rate of 15% is applicable for start-ups if they meet certain conditions.Rousaud Costas Duran

Legal contact