On September 29th 2022, Law 18/2022, of 28 September, on the creation and growth of companies, popularly known as the "Crea y Crece Law", was published in the Boletin Oficial del Estado, Spain's Official State Gazette. Said law will enter into force twenty days after its publication, with the exception of Chapter V, which will enter into force on 10th November 2022.
As stated in the first article of the law, its aim is to: "improve the business climate by promoting the creation and growth of businesses through the adoption of measures to speed up the creation of companies; improve regulation and the elimination of obstacles to the development of economic activities; reduce commercial default and improve access to financing".
To this end, the regulation approves a number of measures aimed, among others, at speeding up and boosting the creation of companies, minimising late payments and facilitating and bringing access to financing closer to all economic operators.
Among the measures adopted, the following are particularly noteworthy:
1. Obligation to issue and send electronic invoices
One of the most noteworthy novelties is contained in Article 12 of the “Crea y Crece Law”, which establishes the obligation for companies and the autonomous professionals to issue and send electronic invoices in all their commercial relations.
In this regard, service providers are under the obligation to facilitate access to the necessary programmes so that users can read, copy, download and print electronic invoices free of charge, without having to resort to other sources to obtain the necessary applications.
It should be noted that, according to section 12.9 of the regulation, failure to comply with this obligation will constitute an administrative infringement punishable by a fine of up to 10.000 euros.
2. Minimum capital for the formation of Limited Liability Companies
One of the new amendments to the Capital Companies Act is the setting of the minimum capital for the incorporation of limited liability companies at one euro.
This abolishes the requirement of three thousand euros (3.000.-€) as the minimum share capital previously set by the Capital Companies Act.
One of the consequences of the adoption of this measure is the elimination of the possibility for a company to choose to incorporate under a successive formation regime, since the purpose of this regime was to enable the incorporation of a limited liability company with a capital lower than the minimum previously required, which now does not exist.
With regard to these limited liability companies with a share capital of less than three thousand euros (3.000.-€), a number of limitations are introduced for the benefit of creditors. Among them, the following stand out:
Firstly, the obligation to "allocate to the legal reserve a figure equal to at least 20 percent of the profit for the financial year, with no limit on the amount".
In addition, it is stipulated that dividends may only be distributed to shareholders if, once the legal or statutory provisions have been met, the value of the net assets is or, as a result of the distribution, is not less than eight hundred euros (800.-€).
Finally, it is established that, in the event of voluntary or compulsory liquidation, if the company's assets are insufficient to meet the payment of its obligations, the shareholders and directors of the company are jointly and severally liable for the payment of the amount of the capital plus the difference between this figure and the figure of three thousand euros.
3. Telematic creation of companies
Another of the measures adopted, is the possibility of setting up companies online through the Information Centre and Business Creation Network (CIRCE, from its acronym in Spanish).
This measure, in line with the objective of the regulation, aims to guarantee a reduction in the time, notary and registration costs associated with company incorporation.
4. The fight against commercial late payment
As mentioned above, the preamble to the regulation includes the fight against commercial late payment as one of the objectives and reasons for its enactment. In order to tackle this problem, a series of measures have been adopted, including the following:
(i) Creation of the State Observatory on Private Delinquency for the purpose of promoting transparency with respect to payments in commercial transactions.
(ii) Establishment of a system of incentives to reduce payment delays.
(iii) Obligation for commercial companies to indicate in their annual reports the average payment period to their suppliers or the number of invoices paid in a period shorter than the maximum established in the regulations on late payment.
5. Access to financing
Finally, it should be noted that the regulation incorporates a series of measures aimed at improving the instruments for financing business growth.
In this regard: (i) "debt funds" are regulated (see new article 4 bis of Law 22/2014, of 12 November); (ii) investment in Fintech is included as the main purpose of venture capital (see article 9 of Law 22/2014, of 12 November); and (iii) the content of the mandatory investment ratio is extended.
In addition to all this, in the framework of crowdfunding activities, the regulation adapts national regulations to European regulations, establishing flexibility for these platforms to provide their services in Europe, while reinforcing investor protection and allowing the creation of vehicles to group investors and thus reduce management costs.
Pedro Pérez-Cuesta Llaneras
Illeslex Abogado
08-ene-2024 / ARTICULO
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