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Starting a business in Spain following Brexit Why should you hire an international law firm?
After voting to leave the European Union in 2016, the UK became a non-trading centre, which came into effect on the 31st of December 2020.
In 2019, there were approximately 994,000 British nationals living in countries across the EU, with the most populous country being Spain. There are various benefits to starting a business in Spain, however, it is first important to understand the legal procedures.
In this guide, we explore how to set up a business in Spain and how Giambrone & Partners can help.
Click on the links below to jump to that section:
Discover the advantages and disadvantages of Brexit regarding starting a business overseas as a British citizen.
Find out if it is viable to start a business in Spain.
Read about the different documents you will need to start a business in Spain.
Discover the most frequently asked questions on starting a business in Spain.
How has Brexit affected British businesses in Europe?
Brexit has impacted the interaction between Britain and the rest of Europe, and has to some extent impeded how businesses operate on a larger scale. One of the main differences since leaving the EU is the effect on the import and export trade as there are additional tariffs to be paid when transporting goods to European countries.
To move goods between Britain and Spain, businesses will need an Economic Operators Registration and Identification (EORI) number. Make sure to hire a company formation solicitor with a comprehensive understanding of the requirements to operate legally.
Is Spain one of the best countries to start a business in?
In the last five years, the Spanish economy has continued to rise and surpass its European counterparts. The World Economic Forum states that Spain is the 4th largest economy in the EU and has had more than 14,600 foreign firms set up businesses in the country.
For British businesses hoping to expand in Europe, the Spanish commercial market has various benefits, as it has a considerable presence on the international market and foreign businesses can import and export on a much larger scale.
Powerful economy.
With regard to tourism and other business sectors, Spain has one of the world’s largest economies; its prime location permits easy access to EU facilities, which in turn, enables trade with businesses and traders in neighbouring countries. It is also closely located near the Middle East and northern Africa.
Spanish commercial law differs from the law in the United Kingdom. Therefore, you should instruct international and multilingual lawyers with a full understanding of both jurisdictions to assist in all aspects of cross-border business.
Contact our team at Giambrone & Partners today to see how we can help you.
Focus on investment and development.
The Spanish government provides various financial and tax incentives for businesses looking to expand or start a company in Spain, and encourages research and development in a range of sectors. This includes a bespoke search engine dedicated to finding incentives that can assist businesses to expand.
Duality agreements.
Spain has access to the agreements in the EMEA (Europe, Middle East, North Africa) markets, which assists in cross-border trading. The Spanish market also has similar agreements with Central and South America; 17 of which can be utilised to avoid double taxation, as well as 19 of which offer protection for investment.
Operating across multiple jurisdictions can be challenging for businesses. Giambrone & Partners has a team of highly experienced legal and tax advisors that specialise in international taxation that can assist businesses. Find out more about our corporate international tax services.
Duality agreements.
The documentation you require to start a business in Spain as a British national
Anybody can start a business in Spain. However, since leaving the European Union, it has been more difficult for British nationals and other expats outside the EU to set up a business in Spain. British citizens need a work permit to form a company in Spain. Other documentation includes:
Foreigner national’s tax identification number (NIE number).
For both Spanish citizens and foreign nationals, an NIE number is required to open a Spanish bank account and enable the tax authorities to identify the business.
For non-EU citizens, applications for an NIE number can be made at a Spanish police station and is beneficial to seek the help of an international solicitor.
Register the company name with the Mercantile Registry (RMC).
Businesses must obtain a verification certificate from the RMC, which usually takes up to three days.
Obtain a company tax identification number (CIF).
This will establish tax identification with Spanish authorities and allow the company to operate.
To import and export within the European Union, the business will also need an EORI number, which is typically supplied during the company registration.
Open a business bank account.
After obtaining an NIE, the business is required to contribute €3000 for the constitution of the firm and to generate a bank certificate that establishes the payment. When opening a bank account, you should have the assistance of an international solicitor, who understands Spanish law, and can speak both Spanish and English.
Sign the deed of incorporation.
A deed is required to establish the company; it is an official document outlining the key details of the business. This will require the tax form 036 and all the above documents, such as the certificate from the RMC and an NIE.
Once the application has been made, either you or your international lawyer will need to arrange for a local notary appointment to sign the deed before it is registered at the local government tax authority. This can all be arranged by your lawyer.
Giambrone & Partners is an international law firm that operates in various countries across the globe, including Spain, Portugal and Italy. When assisting clients in these countries, our team of international and multilingual lawyers have the potential to draw together cross-jurisdictional teams that can speak the language of each country and have a comprehensive understanding of its laws.
For more information, or to receive advice from one of our experts, contact us today.
Frequently asked questions
How long can you stay in Spain if you own a property?
Since January 2021, when the Brexit agreement commenced, those who do not have Spanish residency, or a visa, can only stay in Spain for 90 consecutive days, regardless of whether they own property. You may not return for 90 days.
Find out more about Spanish property regulations at our website.
How long can you stay in Spain on a business visa?
To form a company in Spain, British nationals will need to apply for a business visa, which requires to be renewed each year. After five years, workers can then apply for resident status in Spain, removing the need for a future work permit.
Discover more information on how to obtain Spanish citizenship here.