Spain offers seamless access to the vast EU market, alongside strong ties to Africa and Latin America.
Spain offers stability, sunshine, and plenty of opportunity. These incentives have attracted nearly 15,000 foreign firms to set up operations in one of the world’s most connected countries.
Spain is the 14th largest economy in the world and the 13th most attractive for foreign direct investment. It has a particularly active real estate market, driven by tourism and immigration. Every year, thousands of people from northern Europe and beyond choose to make their homes on the Mediterranean coast.
So the opportunities are there, but how easy is it to do business in Spain, Europe’s own sunshine state? That was the subject of our latest Doing Business Internationally webinar, which featured expert contributions from Carmen Rózpide, managing director of CSC Spain, and Ana Freire Villanova, business unit manager, Corporate and Legal Solutions.
Setting up a business in Spain
Spain’s economic standing has encouraged many international companies to open branches or regional offices in Spain, and there are several entry options for overseas investors. The simplest is the representative office, an entity designed for temporary marketing or market analysis purposes. Representative offices create no revenue and pay no corporate income tax.
For operating companies, a permanent establishment—typically a branch office—involves appointing a local tax representative and registering with relevant authorities. Subsidiaries, usually limited liability companies, are another option and have full legal personality.
Establishing an entity in Spain is generally straightforward, but there are a number of things to look out for. For instance, shareholders and directors need Spanish ID numbers. This is a formality, but companies can’t be incorporated without them. In addition, companies that cross certain thresholds around size and turnover may need to appoint an independent auditor. Spanish GAAP is the mandatory accounting method.
Spain also insists on stringent anti-money laundering and know your customer (KYC) checks. Entities must be prepared to disclose ultimate beneficial ownership during the incorporation process, and when opening bank accounts and filing annual accounts with relevant registers. The world is moving towards greater corporate transparency and Spain is no exception.
Investing in Spain
Spain has long been a magnet for people looking for a slice of the good life, whether as tourists, workers, or retirees. That appeal has created a lively real estate market and investment opportunities in the construction, housing, hotel, and wider hospitality sectors.
Spain, however, is about much more than sun-drenched seaside resorts. It boasts a flourishing health sector and is the leader in Europe—and second only to China globally—in terms of technology and industrial infrastructure. This is supported by the Spanish government’s research and development strategies, which have resulted in the capital Madrid becoming one of Europe’s most innovative city regions.
Creativity is also driven by a highly qualified workforce that is less expensive to employ than equivalents in other western European countries.
Spain is an international business hub
Another benefit of doing business in Spain is the country’s position at the heart of a global trade network. First and foremost, Spain is a member of the EU, giving investors easy access to the world’s largest single market area under the protection of EU law.
Spain is also a short hop to North Africa and the Middle East, and many businesses use it as a gateway for expansion into these regions. In addition, it has strong historical and linguistic ties with Central and South America, encouraging a two-way exchange of talent and investment.
For these reasons, Spain has been able to develop a highly internationalized business sector, supported by government policies that facilitate the entry, residence, and permanence of foreign workers.
In all this, CSC can help. CSC specialists can meet all your day-to-day corporate obligations from an administrative perspective, and ensure your entities always remain in good legal standing. By leaving you to focus on growing your business, we can help you turn potential into profit in Europe’s sunshine state.
CSC offers a full suite of corporate services in Spain, from entity formation to liquidation, and everything in between.
CSC provides knowledge-based solutions for every phase of the business life cycle, helping businesses form entities, maintain compliance, execute transaction work, and support real estate, M&A, and other corporate transactions in hundreds of US and international jurisdictions.
We work with some of the world’s largest banks and commercial lenders to reduce risk in their lien portfolios, improve their transaction speeds, and create a secure environment for their financial processing needs. We also provide solutions for secure real estate document preparation and recording.
We are the trusted partner for 90% of the Fortune 500®, nearly 10,000 law firms, and more than 3,000 financial organizations. Headquartered in Wilmington, Delaware, USA, since 1899, we are a global company capable of doing business wherever our clients are—and we accomplish that by employing experts in every business we serve. Missed this webinar? Watch it on demand and register for the full series here.