One issue that often raises doubts in foreign individuals and companies considering developing a business through a capital company in Spain regards the legal requirements for the designation and appointment of the Management Body, and especially the possibility to name a Foreign Director.
The Spanish Companies Act (LSC) specifies in Article 212 that the company may appoint both natural persons and legal entities as Directors; and that it is not necessary to be a shareholder to serve as a director.
According to the same article, if the appointed director is a legal entity, it must name a natural person to perform the functions inherent to the position. The revocation of such a person shall not take effect until the appointment of a new representative, which must be registered within the Commercial Registry.
Article 213 LSC sets out several prohibitions regarding the role of Director, for example:
- Unemancipated minors
- Legally incapacitated individuals
- Individuals disqualified by insolvency proceedings
However, it does not add any additional requirements, so nothing impedes the appointment of a Foreign Director.
By Resolution dated 18th January 2012, the General Directorate of Registries and Notary (DGRN) states that any Foreign Director must have a foreign identification number (N.I.E.) to be eligible for the role.
Appointment of the Foreign Director
The board of partners shall appoint the Foreign Director and she/he shall accept her/his position, at which point the appointment shall take effect (Article 214 LSC). Subsequently, the corresponding public deed shall be granted, which must be registered in the corresponding Commercial Registry, outlining the identification details of the appointed Director and whether she/he can act jointly or jointly and severally.
When the Foreign Director resides in a different country, it is possible to grant a general power of attorney in favour of a resident in Spain, who will carry out his duties on site. This general power of attorney must be inscribed within the Commercial Registry and may establish a series of limitations and restrictions to define the powers granted.
In short, there is nothing to prevent the appointment of a Foreign Director, whether she/he lives in Spain, provided she/he obtains beforehand a foreign identification number (N.I.E.).
If you require additional information regarding Foreign directors in Spain,
This article is not considered legal advice