Company formation in Spain

If a company is formed by a physical entity that does not have a residence permit in Spain, it is necessary to apply at a police department for a foreigner’s identification number, or NIE (Número de Identidad Extranjero), which also functions as the tax identification number.

Company registration in Spain

The main types of legal entities in Spain consist of the following:

The procedure for forming a company in Spain is divided into several stages, of which the limited liability company (S.L.) and the joint stock company (S.A.) share the same stages:

• company registration in Spain: choice of the official name and its registration in the Central Commercial Registry, account opening, preparation of the deed of incorporation and the notary registration act, payment of the legal entity formation tax, and registration of the company at the corporate registry.
• tax registration: obtainment of the C.I.F. (Spanish company registration number), registration in the tax office at the legal address of the company (the place where the company has been incorporated) as a taxpayer on economic activity and VAT.
• administrative procedures at the Ministry of Labor: registration of individual enterprise in the Social Security General Treasury (for a business manager, or “Administrador”), registration of the workers, notification of the Regional Authorities Office about the company foundation, and commission of the log book, or “libro de matrícula”.
• administrative procedures at the local authorities (city council, or “ayuntamiento”): application for the opening license and construction and maintenance works license (in the office and/or commercial premises).

A Limited Liability Company – New Company, or “Sociedad Limitada – Nueva Empresa” (S.L.N.E.) is a separate case of S.L. This type of legal entity is granted a simplified and accelerated procedure of company registration in Spain through a system of electronic document submissions. It is crucial to remember that the company name must include the last name and the first name of the company’s founding members, arranged alphabetically, and it must have the S.L.N.E. abbreviation.

Registration of an individual enterprise in Spain - Autónomo

Individuals who wish to work autonomously in Spain are not required to form a company as a legal entity. Instead, it is possible to register as an individual entrepreneur, or autónomo, through the following steps:

• registration at a tax office of the residence of an entrepreneur paying taxes on economic activity (Impuesto de Actividades Económicos (IAE)) and VAT (IVA).
• registration in the Social Security System (“Seguridad Social.”)
• issuance by the city council (ayuntamiento) of an Opening and Equipment License (Licencia de Apertura de Actividades e Instalaciónes). If construction and maintenance works are necessary, a Works License (Licencia de Obras) can be applied for at the ayuntamiento.
• registration of the company with the social security authorities and obtainment of the payment account code. This is a one-time formality that is necessary when signing the first contract with a hired worker.
• registration of every individual worker within the social security system.
• commission of the Visit Book (Libro de Visita).

Finally, a branch of a foreign company can also be established. Both a limited liability company (S.L.) and a joint stock company (S.A.) are legal companies.

Overall, the requirements for establishing a foreign company’s branch registration in Spain coincide with those necessary for the formation of a limited liability company and a joint stock company.

Additional stages may include preparation of the required documents of a parent company, including documents concerning the formation of the parent company’s representation; translation of the documents by a sworn translator for submission to the Mercantile Register of Spain; and attainment of the certificate of a parent company’s legal activities from the Spanish Consulate of the parent company’s country of origin.