Contents
The most common types of commercial companies in Spain
Complete list of varieties of legal forms in Spain
Types of management bodies in limited liability companies
If you are interested in the title of this article, we can assume that you have decided to register a business in Spain.
The choice of the type of commercial company depends on many factors, such as the size of the business, number of employees, tax liabilities, etc.
The most common types of commercial companies in Spain
Private entrepreneur (Autonomo)
The easiest way to start a business in Spain, in which you are the sole owner. The company, in this case, is subject to individual income tax (IRPF) and will need to be registered in the national registry of taxpayers (Censo de Empresarios).
Partnership (Comunidad de Bienes)
Is a business structure in which two or more persons jointly own a business and share profits and losses. Each partner is personally responsible for a share of the business.
OOO (Limited Liability Company or SL)
Is the most common type of business in Spain, where owners have limited liability for their share in the company. In addition, they are subject to corporate income tax (Impuesto sobre Sociedades).
Joint Stock Company (Sociedad Anónima or SA)
The type of company that can sell shares on the stock exchange. This type of company is usually used for large companies.
Full list of legal forms in Spain
Individual entrepreneur – Autónomo
Full partnership – Comunidad de Bienes
Ltd. – Sociedad Limitada (S.L.)
Ltd- New Company – Sociedad limitada – Nueva Empresa (S.L.N.E.)
АО – Sociedad Anónima (S.A.)
Labor LLC – Sociedad Limitada Laboral (S.L.L.)
Sociedad Anónima Laboral – Sociedad Anónima Laboral (S.A.L.)
Corporate Society – Cooperativa
Each of these types of companies has its advantages and disadvantages, and choosing the most appropriate one depends on the specific task and business needs.
Types of management bodies in limited liability companies
In Spain, there are several types of governing bodies in limited liability companies:
Sole Administrator
Responsible for the general management of the company and its legal obligations. This can be a legal or natural person appointed in accordance with the company’s articles of association. The sole administrator may not delegate his or her position to a third party.
Several equal directors.
In this case, the power of representation belongs to each of them. They may act separately, without the need for the other, and may independently take any action with respect to the company.
Two or more joint administrators
The power of representation shall be exercised jointly by at least two of them in the manner prescribed by the Charter.
Board of Directors
It is a collegial body in which the consent of a majority of its members is required for any action to be taken. In the case of limited liability companies, the Board of Directors must consist of a minimum of three and a maximum of twelve members, who are responsible for making strategic decisions of the company. As in all collegial bodies, a quorum of attendance and a majority vote is required to make decisions. In order for the board to be considered truly constituted, half plus one of its members must be present or represented at the meeting. Decisions are made by an absolute majority of the directors.
It is also important to keep in mind that there are certain positions that need to be assigned to the Board that will have different functions:
Chair (or vice-chair): responsible for convening and setting the agenda, as well as chairing and coordinating meetings
Members of the board: serve as the administrative body with the chairperson and are responsible, along with him, for the work of the board
Secretary of the board: responsible for the correctness of procedures and compliance with established rules
There is also the General Meeting (Junta General de Socios – the supreme assembly of partners/shareholders).
This is the highest governing body, where all partners participate and make significant decisions, such as amending the articles of association, appointing or dismissing directors, and distributing dividends.
Overall, the system of governing bodies and the general meeting creates a unified structure that ensures the effective management and control of the company.
Selecting the right management model can be complex, especially in a foreign country. Therefore, it is essential to consider both legal and financial aspects. Experienced specialists can help you make the right choice and mitigate risks.