Establishing an LLC (S.L.) in Spain as a foreigner

If you are thinking about constituting a Limited Liability Company (S.L.) in Spain, in this post you will find a summary of the main steps foreigners ought to follow.

Limited liability companies are one of the most common types of corporation in Spain, since they are the most appropriate ones when aiming to form a small company while shielding the partners from unlimited responsibility to its debts.

The process of constituting a Limited Company (S.L.) is the following:

1. Obtaining your NIE (“Foreigner ‘s ID number”)

The first thing you should keep in mind is that, in order to create an S.L. in Spain, its partners and whoever assumes the charge of Managing Director, should they be foreigners, will have to be in possession of an identification number in Spain (NIE). The possession of this number (NIE) does not entail any fiscal obligations in Spain and does not have, in principle, any effect other than being identified before the Spanish authorities.

There are two ways to obtain the NIE depending on whether you are in Spain or abroad at the time of application:

1. If you are in Spanish territory, you must request an appointment to go to the General Directorate of the Police. The requests can be made online, via the site

2. From any other country, the best course of action is to visit the nearest Consulate General of Spain. In these cases, obtaining the NIE can take between 15 and 20 days. Note that each consulate has a way of organizing, but the usual procedure is to request an appointment to carry out this process. In addition, the consulate will require you to:

a- Contribute a copy of your passport (or your Identity Card in case you are a national of an EU Member State where citizens have this type of identification document).

b– Fill in a form explaining the reasons why you are requesting the NIE.

c- Pay a fee for the management of obtaining your NIE.

2. Negative certification of the name of the company

Your company will need a denomination, which ought to be unique and not coincide with any of the existing companies. For this reason, the central Mercantile Registry is requested to certify that the name that is desired for the company is available.

3. Contribution of a minimum share capital of € 3,000 and an active bank account under the name of the company.

The law requires that the minimum social capital of this type of company be € 3,000, that is to say that the partners must provide at least that amount, either in money or in kind, through movable or immovable property for this value. In the case where immovable property is contributed to the society, this contribution must be made by public deed.

It is also interesting to open a bank account under the name of the company in which to deposit these € 3,000, as well as the place to collect earning revenue and payments once the company begins operating.

However, it should be noted that, due to the anti-money laundering regulations, the bank will require for the opening of the account the presence of the partners or the administrator. The attendee will have to address the banking office by contributing their NIE and their passport or identity card.

4. Application for the company’s tax identification number (CIF)

In order for the company to operate normally in legal transactions, it must have a Fiscal Identification Number (CIF) that allows it to issue bills and pay taxes that arise from the achievement and normal development of its activity.

This number must be requested from the Tax Agency that will grant a provisional CIF that will become definitive at the time of registration of the incorporation deed in the Mercantile Registry.

5. Notarised Incorporation Deed

The elaboration of a notarised deed of constitution is perhaps one of the most important points of the entire process. The aforementioned writing must contain:

1. The identity of the partner or partners.

2. The desire to establish a limited liability company

3. The contributions that each partner makes to the company and the numbering of the shares assigned as payment.

4. The determination of the definite way in which the administration is initially organized, in case their statutes provide for different alternatives.

5. The identity of the person or people who are initially responsible for the administration and social representation.

6. The pacts and conditions that the members consider appropriate, as long as they are not contrary to the provisions of the laws.

7. The bylaws of the company (Articles of association) which must, at least, consist of:

a- The Name of the Company.

b- The Corporation Purpose.

c- The Registered Office.

d- The Share Capital, the shares in which it is divided, its nominal value and its correlative numbering and if they are unequal, the rights that each attribute to the partners and their amount or extent.

e- The way or ways of organizing the administration of the company, the number of administrators or, at least, the maximum and minimum number, as well as the term of duration of the charge and the retribution system, should they have it.

f- The way to deliberate and adopt their agreements the collegiate members of the society.

6. Incorporation and Registration in the Companies House

Finally, the deed of incorporation must be submitted to the Commercial Register of the province where the company’s registered office is located.

Accompanying the script or duly registered in it, will be:

• The certificate of negative denomination.

• The provisional CIF.

• The letter of payment of Corporate Income Tax.

• Settlement of the Tax of estate transfer and documented legal acts.

Registration in the Mercantile Register is mandatory for limited companies because legal personality is acquired only after the aforementioned registration.

The consequences of not registering the deed of incorporation in the Mercantile Registry after one year from the granting of this deed are the assumption of unlimited liability by the members of the S.L., regarding acts and debts that the company makes or acquires.

Once this point is reached, our S.L. will already be registered. Even so, before beginning to develop the activity for which it has been conceived, the society must:

• Register in the Census of Entrepreneurs before the Tax Agency.

• Keep in mind that the company will be subject to the Tax on Economic Activities at the Tax Agency.

• Register affiliates and administrators in the corresponding Social Security schemes in the General Treasury of the Social Security.

• Legalization of the Book of Records, of the Register of members, of the Book of nominative shares and of the Book registration of contracts between the sole shareholder and the company in the Provincial Commercial Registry.

• Legalization of the Daily Book and the Book of Inventories and Annual Accounts in the Provincial Commercial Registry.

• Obtain an electronic certificate before the Certification Authorities.

After completing the previous requirements, the company will already be ready for its start-up. However, it should be taken into account that depending on the nature of the activity it develops, it may have some more requirements to meet, such as having an activity license that must be requested from the City Council. Do not hesitate to contact a lawyer for any further question.

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