Foreign investors have several options for investing in Spain:
• Constituting a Spanish company. The most commonly used company format is the limited liability company (S.L.). Also widely used is the public limited company (S.A.), an option generally selected by companies of a certain size. Companies have their own legal status. S.A.s and S.L.s are companies with a mercantile character in which the liability is limited to the capital provided. Both types of companies can also be constituted by a single person, or become uni-personal when, once they have been constituted, all the shares become the property of a single partner.
• Opening a branch. This does not have its own legal status independent of the parent company. However, this type of establishment implies permanent representation and a degree of management autonomy for carrying out the activities of the parent company. Subsidiaries are entered in the Companies Registry.
• Creating a representative office. This way of becoming established in Spain is only suitable for foreign companies who intend to carry out only auxiliary or secondary activities in Spain to the parent company's activities abroad.
• Associating with other companies already established in Spain: joint ventures are a frequent way of becoming established in Spain, as this is a way to share risks and pool resources and experience. The Spanish legal system distinguishes categories of different joint venture.
• Activity developed directly by a company owner who is an individual. The Spanish legislation also contemplates a particular form of business activity by an individual company owner through the figure of the “limited liability entrepreneur".
However, it is not essential to invest in Spain to set up a new company or to associate with pre-existing companies. It is possible to have a presence in the Spanish market without the need to physically establish a center of operations in Spain, through:
• Distribution agreements.
• Conducting operations through an agent.
• Conducting operations through a commission agent.
• Setting up a franchise.
For more information, please see the long version of our Business Guide online:
Last updated: 17|04|2018