Steps to start an LLC or limited liability company in Spain
The steps for starting an LLC or limited liability company in Spain include the following:
- Certification that there exists no other company with the same name as the company to be created. This process involves checking to see if the desired name of the company already exists. If it does not, the desired company name must be reserved in the Commercial Registry of the region in which the company will be formed.
- A bank account must be created in the reserved name of the company, and the required amount of capital to start the company must be deposited. In the case of starting an LLC, the required amount of capital to start up is 3,006 Euros.
- The payment of the incorporation tax must be made.
- The provisional fiscal identification code/tax number of the company must be obtained from the Spanish tax authorities (more information at AEAT).
- The founding partners of the company must perform the signing of a public deed before a public notary to incorporate the company. The public deed must include: the previously mentioned certification that there exists no other company with the same name as the company to be created; proof of the previously mentioned bank deposit; identification information of the partners; and the company’s bylaws (who the actors are and what their powers are).
- Register the company in the Commercial Registry so that the company can begin to operate. To register the company, it is necessary to provide the liquidation of the previously mentioned tax, and the public deed of the company.
- In the Commercial Registry, the company’s records must be legalized and indicate the commercial activities in which the company is going to engage. The following records are some of those required by the Spanish Commercial Code including, for example, inventory and annual accounts, daily records, accounting references, partners’ records, obligatory records for companies, obligatory records for company taxes, etc.
More specifically, the public deed referred to above must contain concrete information about the company. The public deed must specifically contain the following:
- The identity of the partner or partners
- The intent to create an LLC
- The contributions that each partner makes and the number of the participations that are assigned
- The bylaws of the company
- The determination in a concrete form in which, initially, the administration of the LLC is organized, in the case that the bylaws provide different alternatives for the organization of the LLC
- The identification of the person or persons that will initially be in charge of the administration and social representation of the LLC
The public deed may also includes those agreements and conditions that the partners consider necessary, as long as they do not contradict the principles of the LLC outlined in the Spanish Limited Liability Company Law.
In general, a new company’s bylaws must contain a comprehensive and detailed explanation of the rules relating to how the company will function and its relations between it and its members.
This article is not considered as legal advice