SPAIN Law and Practice Contributed by: Marta González-Llera, Toni Barios, Jorge del Castillo and Rafael Baena, Cases & Lacambra
due to incorporation costs and prior registration requirements to be fulfilled before the National Securities Market Commission (CNMV). 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity The main features of the constitution of an entity are the following. Limited Liability Company (SL) An SL company may be incorporated by a sole or several shareholders. Capital is divided into shares ( participaciones ) according to the capital contributed by each shareholder, who benefits from the limitation on personal liability from the company’s debts. They are not marketable securities. An SL is incorporated by public deed and registered with the Commercial Registry. Spanish Corporation or Public Limited Company (SA) An SA may be incorporated by a sole or sev - eral shareholders. Capital is divided into shares ( acciones ) according to the capital contributed by each shareholder, who benefits from the limi - tation on personal liability from the company’s debts. The incorporation process is like an SL, with some specifications. An SA has an open structure that allows the transmission and traffic of shares as negotiable securities. It is common practice to sign a shareholders’ agreement to regulate matters not strictly related to the governance and ownership of the com - pany, such as: • mechanisms and restrictions to the transfer of shares;
• voting criteria; • the resolution of deadlocks; • financing requirements and capital calls; • business plans and strategies; and • control of management and shareholders meetings, etc. 5.3 REITs The Act 11/2009, of 26 October, which regu - lates Listed Real Estate Investment Companies (SOCIMIs) introduced the figure of the REIT (real estate investment trust) into the Spanish legal system. The purpose of the SOCIMI is to invest, directly or indirectly, in urban real estate assets for rental, including housing, commercial prem - ises, residences, hotels, garages and offices, among others. Formally, SOCIMIs must adopt the form of a Spanish corporation and must be listed on a regulated market or in a multilateral trading sys - tem in Spain or in any other country with which there is an effective exchange of tax informa - tion on an uninterrupted basis throughout the tax period. This also subjects SOCIMIs to the super - vision, information, and transparency regime of the CNMV. Therefore, investment by non-residents through SOCIMIs is only subject to the requirements they must comply with to acquire shares of Spanish corporations. Among the advantages of investment through SOCIMIs, the following should be noted: • a special corporate income tax regime applies (0% rate if the SOCIMI complies with the requirement of permanence of its assets); • special tax regime for shareholders; and • others (including capital increases being exempt from stamp duty).
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