DOING BUSINESS IN SPAIN

When considering setting up a business in Spain acquire the guidance of a good lawyer. A Sociedad Limitada may be the correct answer. It can be compared to a Limited Company as in the UK, basically requiring a minimal of capital and having a limited liability to shareholders.

A time period of about two months should normally be allowed for setting up a Company. A deposit to value of the company is made into a provisional bank account opened in the company's name. The bank will issue a Certificate to state that this amount has been deposited in the name of the Company. The current law requires that the minimum amount may not be less than 1.500 Euros.

The Company becoming only becomes legal by an Act recorded in the Public Notary and a tax of 1% of the shareholder's capital is paid to the Oficina Liquidora. The Company will then be issued with its CIF number and is required to indicate whether the Company intends to deduct VAT, or not, on any investments made before the official commencement of trading. With the CIF number an official copy of the Act is sent to the regional office of the Registro Mercantil. This stage takes approximately one month as details are then published in the Spanish Official Gazette. The CIF Card will then be issued and the Company can then proceed with normal trading. By exception, a Company may trade prior to this moment by notifying the Oficina Liquidadora.