ANDORRA Law and Practice Contributed by: Elena Redondo, Albert Hinojosa and Marc Ambrós, Cases & Lacambra
4.6 Agreements With Local or Governmental Authorities
investment scheme ( Societat d’Inversió de Capital Variable – SICAV) or a real estate fund. In respect of corporate vehicles, the incorpo - ration of an SPV is a common instrument for investing in real estate assets. The use of regulated collective investment vehi - cles is more restricted due to the costs asso - ciated with their incorporation and prior regis - tration requirements required before the AFA. However, the tax treatment of collective invest - ment schemes is highly efficient. 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity The main features of each type of entity used to invest in real estate are as follows. • Limited liability company ( societat limitada ) – a company whose share capital is divided into company shares ( participacions ). Part - ners in the company benefit from the limita - tion on personal liability from the company’s debts. Overall, limited liability companies have a closed structure that restricts the transmission of company shares outside the company, and the representation and facul - ties of shareholders in general meetings are limited. • Public limited company ( societat anònima ) – a company whose share capital is divided into shares ( accions ). Partners in the company benefit from the limitation on personal liability from the company’s debts. Overall, public limited companies have an open structure that allows the transmission and traffic of shares as negotiable securities and a broader intervention scope for shareholders in general meetings. • SICAV – an open-ended collective invest - ment scheme whose share capital is divided
Entering into agreements with local or govern - mental authorities, agencies or utility suppliers to facilitate a development project relies on the urban planning and construction legislation and may vary on a case-by-case basis, depending on the specific town hall. 4.7 Enforcement of Restrictions on Development and Designated Use In synthesis, restrictions on development are designed on an ex ante or ex post basis. Over - all, the ex ante mechanisms are controlled by means of the granting of licences through a regulated procedure, as stated in 4.2 Legisla- tive and Governmental Controls Applicable to Design, Appearance and Method of Construc- tion and 4.4 Obtaining Entitlements to Develop a New Project , and by the exercise of the urban supervisory power. Ex post mechanisms are the exercise of the sanctioning power by the admin - istration and the imposition of additional meas - ures with the aim of stopping the administrative offence (including the cessation of construction work ( cessació de l’obra ), the demolition of con - struction work ( demolició ) or the suspension of construction work ( aturada )). 5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets Entities available to investors are: • corporate vehicles, which may take the form of a limited liability company ( societat limi- tada ) or a public limited company ( societat anònima ); or • regulated investment vehicles, which may take the form of an open-ended collective
26
CHAMBERS.COM
Powered by FlippingBook