I will never forget when, many years ago, Alistair Spence Clarke showed me how to set up a UK limited company when sitting at the boardroom of our Marbella office, using a laptop and a credit card and… bang! A UK company was set up after 30 minutes work and it was up and running in 24 hours, having been duly inscribed at the UK Companies House.
Yes, I got somehow embarrassed because, in Spain, the process to set up a Spanish company from step 1 until its formal registration at the Spanish mercantile registry can take between 4 and 6 weeks, with the subsequent lack of competitiveness for business traders who, in most of the cases, want to stimulate the market, create employment and contribute to the growth of the economy, so having such a large number of administrative steps and barriers in this regard is not a good idea.
Historically the different Spanish Governments have implemented legislation in an attempt to set up companies in 24-48 hours (the so called “sociedades express”) but all of them failed as the procedures were not properly defined and, to be honest, most of the Spanish notaries declined offering these services because the notary fees were significantly lower than the cost they had to incur. Notaries are also businesses!
Furthermore, what is more worrying for clients and business traders, is that every time they want to change directors, modify company status, etc, they have to spend money in notary mercantile registry and professional fees, for such very small administrative changes, whereas in other country (mostly anglo-saxon) these are easily arranged electronically and at no cost.
Will this ever improve?
Well, Law 11/2023 of 8 May, which is effective from early November 2023, has introduced new legislation which has been transposed from an EU Directive, to facilitate the digitalisation of notarial acts, so that most of the basic and most common notary deeds can be signed electronically, hence not needed to be personally and physically present at the notary.
This process is at its very early stages, but basically the new electronic system and relevant platforms will allow Spanish notaries to verify the identification documents provided by the grantors of notary deeds. The appearance will be made by videoconference through the notary’s electronic office, and the parties (notary, grantor and interested parties) must identify themselves by means of an electronic identification system provided for and permitted by Spanish law, the most common of which is the digital electronic signature (Digital Certificate / Certificado Digital). In addition, the grantor must provide a telephone number and a suitable email address as means of contact.
During the electronic signature process, the notary must display the document on the platform in sufficient time for the person appearing before signing to enable the notary carry out the necessary verification.
The most relevant notary deeds that can be processed electronically would be as follows:
Finally, on a separate matter, this new law has introduced a modification in the Spanish corporate legislation (Ley de Sociedades de Capital) to formally speed up the process of the set up of Spanish limited companies electronically, not only because it will no longer be necessary to personally attend the signature of the notary deed as explained above, but also because the expected time to get the constitution deed inscribed at the mercantile registry, will be between 2 and 5 working days from the date of incorporation, instead of the typical 10-15 working days it currently takes.
a) Commercial policies.
b) Set up of Spanish companies.
c) Appointment and resignation as directors of Spanish companies.
d) Modification of company statutes (change of name, address, company object, etc).
e) Powers of attorney, except those that provide full representation faculties.
f) Letters of payment and cancellation of guarantees.
g) Legalisation of signatures for legal documents
h) Spanish Wills in a situation of declared pandemic for the duration of the obligation of confinement.
i) Deed of new works (Obra Nueva).
Every little helps and all these initiatives are more than welcomed, now let’s see if they are effective and if all Spanish notaries and mercantile registries are keen to implement these systems in general, otherwise this will not work.
