Spain. Information related-party transactions. Transfer Price Spain
Approval of Form 232 for reporting related-party transactions and transactions and situations related to countries or territories classified as tax havens
Corporate taxpayers and non-resident income taxpayers with permanent establishment must file form 232 and complete the “Information on related-party transactions” if they conduct the following transactions with related persons or entities:
a) Transactions conducted with the same related person or entity provided that the total amount of the consideration for all transactions in the tax period exceeds €250,000, in accordance with market value.
b) Specific transactions, provided that the aggregate amount of each of these transactions in the tax period exceeds €100,000.
However, it is not compulsory to complete the “Information on related-party transactions” in form 232 for transactions between entities belonging to the same consolidated tax group.
Regardless of the total amount of consideration for transactions conducted with the same related person or entity, it will always be compulsory to file form 232 and to complete the “Information on related-party transactions” in the case of transactions of the same type using the same valuation method provided that the total amount of transactions in the tax period exceeds 50% of the entity’s turnover.
This information must be submitted electronically via form 232.
For the 2016 financial year closed on December 31st , the deadline for submission will be between 1 November and 30 November 2017.
From the 2017 financial year closed on December 31st , the deadline for submission will be 30 November each year.
Spain. Agency contract. Payment of the commission even if the client cancel
The Court of Appeal of Madrid orders payment to a marketing agency even when clients cancel
It is common for companies to subcontract marketing agencies to attract customers on their behalf, with the precaution of adding a clause to the outsourcing contract stipulating that if any client cancels within a certain period (normally between three and six months) the agency must reimburse the commission.
However, the Provincial Court of Madrid has limited the practical legal effect of this clause by clarifying that for it to be applicable, the subcontracting company must be able to prove that the client did not cancel for any cause attributable to the company.
So if a customer cancels due to a delayed installation or poor service, the company must pay the agency and cannot apply the content of the clause. However, if the company can prove that the cancelation was not due to any reason attributable to itself, the clause will continue to apply and there will be no obligation to pay the agency.
Spain. Break time during the working day.
Spanish Supreme Court (Tribunal Supremo): Companies can change break times if not most beneficial condition
In this important judgement, the Supreme Court ruled that the fact that a company ‘tolerates’ a coffee break at a certain time during a work shift does not mean that it is consolidated benefit, so not considering it as ‘effective work’ does not entail a substantial modification to working conditions.
The court found that a company can unilaterally and without union agreement, where applicable, adapt the distribution of the working day so that the hours stated in the collective bargaining agreement are worked.
In the case covered by the Supreme Court, eliminating the coffee break meant that the employees would have worked 6.75 hours overtime. The solution proposed by the company was for each employee to take this time off whenever they felt was most convenient, after seeking the company's approval.
The company’s decision, which was rejected by a lower court, was finally upheld by the Supreme Court.
Spain. Control of the email of the employees and Internet access
Court of Appeal judgement highlights the importance of having good internal policy on electronic media and Internet access
The Supreme Court of Murcia, in its sentence of 29 March 2017, deemed the dismissal of an employee for forwarding emails from the company's address to his private account to be fair.
A key factor in this decision was that the company had a clear internal regulation “with specific content” on the use of electronic media and had made an effort to ensure it was known by employees.
“There is no doubt that [the worker] clearly breached trust and loyalty by forwarding emails sent to the company" and “violated the prohibition on the fraudulent use of the company’s media” the court found.
Such emails belong to the company and forwarding them to a private account against the company's express instructions constitutes “misconduct with regards the company’s orders”.
The wording of the sentence seems to suggest that had the company not had a written policy with specific regulations on the use of information, the dismissal would have been deemed unfair unless it could logically be proven that the employee was using the information for dishonest purposes.
It is therefore important for companies that wish to safeguard the custody of emails that reach their employees to have clear policies regarding the exchange of information by electronic means and Internet access.