Company Formation Procedures
Item 4: Procedures for Company Creation
1. Legally Constituting a Company: Specific Procedures by Legal Form
Single-Concessionaire: Individual / ID of the individual entrepreneur
Community Property: Partner’s Passport / Constitution Agreement
Commercial Companies:
- Negative Name Certification
- Bank Account
- Statutes
- Request for Qualification of Draft Statutes (Labor Companies and Cooperatives only)
- Grant Writing of Constitution Publication
- Payment of Taxes on Capital Transfers and Documented Legal Acts (ITPAJD)
- Application for Tax Registration
- Registration Fees
1.1 General Procedures for Implementation
- Ministry of Economy and Finance: Statement on High Tax on Economic Activities (IAE) / Census Statement / Presentation of Financial Books
- City Hall: License for Activities or Facilities / Building Permit
- Ministry of Labor and Social Affairs: Company Registration in Social Security / Registration in the Autonomous Regime of Social Security / Open Communication in the Workplace
- Commercial Registry: Social Documentation / Accounting Documentation
2. Adoption of Legal Personality for Commercial Companies
1. Negative Name Certification
- Why it’s necessary: Law prohibits name coincidence between companies.
- Where to request: Central Business Register (Mercantile Companies) / General Directorate of the Institute for Promoting Social Economy (Cooperatives).
- What the application must contain: Applicant’s personal data / Up to 3 different names for the company.
- Name requirements: Can be composed of letters or numbers / Cannot be the name of a person without their consent / Must include the abbreviation of the legal form adopted / Must not be contrary to the law / Cannot be the name of Spanish communities or autonomous regions.
- Duration: 1 week / Every 2 months unless renewed (4 months for cooperatives) / Expires in 15 months.
2. Account Opening
- Necessary?: Required for some companies with minimum capital requirements.
- Who can open?: The person in charge of the company / If there are multiple partners, all must be present or one with written power of attorney from the others.
- Once opened: The bank issues a certificate of deposit for the notary to enable the written constitution.
3. Company Statutes
- What are they?: Rules governing the company’s life.
- When are they drafted?: When the company has social availability.
- Minimum content: Duration / Address and social capital / Date of activity commencement / Company name.
4. Request for Qualification of Proposed Rules
- Who should apply?: Labor companies and cooperatives.
- Where to submit?: Central Administration or Administrative Organ of a Community.
- Required documents: Negative name certification, minutes of the constituent assembly, draft statutes, and list of promoters.
- Processing validity: 15 days from submission.
5. Granting of Public Deed of Incorporation
- What is it?: Founding members sign the public deed of company constitution.
- Includes: Identity of the partner(s), declaration of forming a company, contributions of each partner, rules, etc.
- Term and cost: Determined by the notaries’ association, no fixed period.
6. ITPAJD (Tax on Capital Transfers and Documented Legal Acts)
- What it records and amount: Tax on the constitution of a company, 1%.
- Where and when to pay: Economy and Finance Department of the Autonomous Community, within 30 business days after granting the deed.
- Form to submit: Form 600.
7. Tax Identification Code Application
- Purpose: Identifies companies for tax purposes.
- Where to request: Administration or Delegation of the State Agency for Tax Administration.
- Documents to provide: Standard form 036 or 037 / Copy of constitution deed and ID of applicant / For cooperatives, also the fiscal classification.
- Deadline: 30 days from granting the deed.
- Validity: 6 months.
8. Registration Records
- Where to register: Commercial Register of the province.
- Documents to provide: Original constitution deed after paying the capital transfer tax.
3. General Procedures for Launching the Company
1. Ministry of Economy and Finance
- Statement on High Tax on Economic Activities (IAE): Local tax for registering artistic or professional activities, within 10 days of starting the activity, using form 840, ID or CIF.
- Census Statement: Summary of the company’s tax situation and obligations, before starting activity, using form 036 or 037, or Tax ID, IAE registration.
- Presentation of Accounting Books: Reflects business operations, mandatory for individual entrepreneurs.
2. City Hall
- License for Facilities and Activities: Certifies compliance with urban regulations, requires IAE registration, lease contract or deed, ID or CIF of applicant company, plans (location), budget, activity specification, within 6 months of starting activity.
- Works License: Necessary for renovations, requires work budget, current status and reform level, descriptive report of works, etc., within 6 months to start works.
3. Ministry of Labor and Social Affairs
- Social Security Registration Number: Mandatory for all employers, before starting activities.
- Registration in the Autonomous Regime of Social Security: Mandatory for individual entrepreneurs, partners of limited and collective companies, partners of community properties, civil societies, partners or administrators of mercantile companies, optional for cooperative members, within 30 days of starting activity, requires IAE registration, applicant’s ID.
- Registration in the General Regime of Social Security: Mandatory for employees, before starting activity, requires worker’s ID or foreign identification document.
4. Commercial Register
Social Documentation:
- All companies: Partners’ book.
- Limited companies only: Register of participations.
- Anonymous companies only: Book of bearer and registered shares.
- Cooperatives only: Partners’ log book, associates’ log book, capital contributions log book.
Accounting Documentation:
- Journal
- Book of inventories and annual accounts