ANDORRA Law and Practice Contributed by: Elena Redondo, Albert Hinojosa and Marc Ambrós, Cases & Lacambra
struction work ( demolició ) or the suspension of construction work ( aturada )).
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 into shares ( accions ) and whose general legal regime is determined by corporate regulations applicable to public limited ( societat anòni - ma ), with specific regulatory requirements. Its government and management may be per - formed by a management company ( societat gestora ) if provided for by the SICAV’s articles of association. • Real estate fund – a collective investment scheme whose assets are governed and managed by a management company ( soci- etat gestora ) and held in custody by a custo - dian ( societat dipositària ). Their relationship is governed under a written agreement the legal content of which is legally determined. SICAVs and real estate funds are subject to Corporate Income Tax at a nominal rate of 0%. Although, CFC rules may apply if the taxpayer, whether by itself or jointly with certain related persons or entities, holds 50% or more of the share capital, equity, voting rights or results of the Andorran collective investment scheme.
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 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
27
CHAMBERS.COM
Powered by FlippingBook