INTRODUCTION
As a necessary premise to this article, we should recall that Act 13/2010 on measures in the business ambit established, for the first time in Spain, a legal framework for what are known as quick formation companies.
Following the passing of Royal Decree-Law 14/2013 to support entrepreneurs and their internationalisation, said legal framework was revoked and substituted by a new legal framework.
CURRENT SCENARIO
Royal Decree-Law 14/2013 practically revokes all of the resolutions, which regulated this procedure. Instead, a new system is established, presumably reserved for entrepreneurs, but which in practice may be taken advantage of by any company given that the law does not set forth an exclusive application to a certain type of company.
Essentially, the modifications established by the new law are as follows:
A shorter term for the incorporation of a limited company is established. Under the new regulations, the incorporation of a limited company with standard company bylaws may be carried out in twenty-four (24) working hours.
The maximum limit on company capital is eliminated, which was previously 30,000.- Euro.
Changes to business activity licenses are introduced.
THE EFFECT ON FOREIGN INVESTMENT
Despite being a law conceived to facilitate the entry of more foreign investment into Spain, in this particular case, the law only provides for the speeding-up of the procedures necessary for the incorporation of companies with domestic capital. No mention at all is made regarding the incorporation of companies with foreign capital, and therefore, the extraordinary procedures, which the incorporation of this type of company entails, are not seen to be improved in any way.
Some issues to be taken into account are, for example, that there is no prevision regarding the fiscal representation of a company incorporated with foreign capital or the possibility to send said power of attorney to the Spanish Tax Administration by computer system (CIRCE).
CONCLUSION
It seems evident that an improvement in the time scale for the incorporation of a quick formation company has been made, with the added advantage of no modification to the notary tariff (150.- Euro) regardless of the elimination of the limit on company capital. However, for the reasons set forth above, it is difficult to see the potential reality of this law applying to companies with 100% foreign capital.
Vilá Abogados
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3rd of April 2014
