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Setting up a business in Spain

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If you wish to settle in Spain and be your own boss, you may set up a business there. Related procedures are explained in this article.

Spain is very conducive to foreign investment. Spanish authorities, in fact, greatly encourage the setting up of big, small and medium enterprises in the country in order to boost up its economy. Hence, foreign investors and the most welcome there, whether they come from European Union or non-European countries. Procedures applying to European Union citizens are however simpler than those applying to non-European citizens. You are advised to seek information with the Spanish Ministry of Industry, Trade and Tourism before proceeding.

Types of companies

Spain provides several tax benefits as well as local, provincial, national and European aids to foreign nationals looking forward to invest in the country.

In general, foreign investors are likely to set up three different types of company statuses in Spain, namely the:

  • Sociedad Limitada
  • Sociedad Anónima
  • self-employed.

Feel free to seek more information about these statuses from your home country's economic mission, embassy or consulate based in Spain, or via binational chambers of commerce.

Note that associates contributing to the company's capital can also act as managers or directors. However, they are not entitled to the company's dividends. They can only manage the company and its assets.

Setting up a business

To set up a busines in Spain, you are required to :

  • obtain a personal identification number
  • book your company name with the Central Register of Madrid
  • open a bank account and deposit the minimum capital
  • establish the articles of the company
  • appear before a Spanish notary along with your business partners
  • obtain a CIF (Código de Identificación Fiscal) from tax authorities

Once you have booked the company name, it will be valid for three months following the booking date and can be renewed. Note that the bank account has to be opened in the name of the partners.

The validity of the name of three months, renewable for three months after it has been reserved. As for the bank account must be opened in the name of the partners. After filing the required minimum, a certificate will be issued by the bank. Once you have deposited the minimum capital a bank certificate will be issued.  

Self-employed

To become a self employed in Spain, you have to:

  • obtain a personal identification number
  • apply for a business licence at the nearest municipality or Gestión Tributaria office
  • produce a duly filled 037 form to be certified by tax authorities
  • register your company with the Spanish Social Security scheme under the self-employed (Régimen Especial de Trabajadores Autónomos)
  • register your employees, if any, to the Social Security scheme
  • keep a ledger-book.

The municipality's compliance services will then make an audit of your company's equipment before issuing a compliance certificate.

As relating formalities can be quite complicated, you are advised to hire a lawyer or a notary, or to seek the help of experts to set up your business. 

 Useful links:

Central Mercantile Register www.rmc.es
Central Mercantile Register - Registering your company www.rmc.es/Deno_solicitud.aspx?lang=en
Ministry of Industry, Energy and Tourism of Spain – Setting up a business www.circe.es
Invest in Spain www.investinspain.org

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Barcelona, Catalonia's economic center, attracts not only young professionals but also many foreign companies and investors looking for new opportunities.
Madrid's labor market has been facing a shortage of qualified and skilled workforce since some time. Hence, it is open to young foreign professionals.
Malaga has been one of the most affected Spanish cities by the global economic crisis. Hence its high unemployment rate during recent years.
Sevilla's economy is recovering gradually after having been seriously affected by the global economic crisis. Unemployment rate has also been in decline.
Tenerife Island and Santa Cruz de Tenerife, its capital city, are known to be tourist destinations. But there are also jobs opportunities in many fields.

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