Business development and management solutions in Spain

Legal framework

As with most Latin countries, legal requirements are much more onerous than in Anglo-Saxon environments. Most small and medium sized companies appoint partners of law firms as company secretaries on a retainer basis to cope with the plethora of legal obligations. The cost of setting up a new company is high compared to e.g. Northern Europe.
Company law is governed by local laws (ley de sociedades etc) and by the commercial code (código de comercio) which defines invoice requirements and so on. National legislation is published in the daily state official bulletin (BOE), and local legislation in local bulletins.
Possible company structures are similar to other European countries. Most large and medium companies set up as SA (Sociedad Anonima), and smaller companies usually opt for the SL format (Sociedad Limitada). The usual other options also exist.
Notaries are a way of life in Spain. Their 'intervention' is required in all bank loans and overdraft facilities, signing powers (see below), presentation of annual accounts, etc. General notaries are known as 'notarios', and commercial notaries are 'corredores de comercio'. Notaries are 'notorious' for being slow and expensive.
Executive powers of company directors and employees must be defined in writing and in most cases notarized and registered with the local mercantile registry (registro mercantil). These include bank signing powers, representation of the company in official, commercial and legal matters and labour responsibilities (hiring, firing etc). Banks will normally ask to see registered 'poderes' when opening bank accounts etc.

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