Spanish Joint Venture. Mandatory obligations of the shareholder
In case you decide to enter in a Spanish company , you should know that articles of association can include specific “do” or “do not” obligations for some or all of the shareholders, distinct from the contribution to capital. These are typically concrete activities beneficial to the company, which shareholders must perform due to their special professional or technical abilities, their knowledge of new markets, their contacts in the industry, etc.
When treated as ancillary services, these obligations become “fundamental” for the company, such that if a shareholder fails to fulfill their ancillary services, they may even be excluded from the company.
The possibility of excluding the non-compliant shareholder is certainly an attractive solution for the remaining shareholder, as the legal personality of the company remains unchanged, and the company can continue its activities as such.
However, if the key obligations of the shareholders are included in a Shareholders’ Agreement, the possibility of excluding the non-compliant shareholder is more complicated, and in many cases, in the absence of an agreement, the company would likely face dissolution.
Exclusion of a shareholder entails the obligation for the remaining shareholder(s) to pay the value of the excluded shares based on the most recent financial statement. If the excluded shareholder holds more than 25% of the capital shares, the simple resolution of the general shareholders’ meeting is not sufficient, and court intervention is necessary to effect the exclusion.
Set up a company in Spain. Tax exemption
The exemption from the Impuesto por Operaciones Societarias (Tax on Corporate Transactions) remains in effect for the incorporation of companies and capital increases, except for companies with real estate assets on the balance sheet.
