The Spanish government intend to approve before the end of the year, a new law in support of entrepreneurs. The law was announced at the beginning of last year but has several delays.
In Spain, SMEs (Small and Medium enterprises) are creating most of the jobs and it is vital to help them to weather the present economical downturn.
Company creation in 24 hours
The main idea is to enable entrepreneurs to create a company in less within 48 hours. Most of the steps of the company creation will be done online.
A network of local “Entrepreneurs Help desks” (PAE puntos de atención al Emprendedor) will be created in order to assist in administration tasks and information regarding financing for new companies.
VAT changes
Companies/entrepreneurs with yearly cash flow of less than two million Euros will be able to choose to pay VAT when clients pay their invoices instead of when the invoice was issued.
Of course there are exceptions and limitations such before the 31st December the VAT will have to be paid regardless the invoice has been paid or not.
New types of companies
There will be two new types of companies:
– The ‘Emprendedor de responsabilidad limitada’ (entrepreneur with limited responsibility)
– The Sociedad Limitada de Formación Sucesiva (limited company with postponed formation)
The first type enables a physical person to exclude from the responsibility derived from debts, his permanent residence and a family vehicle up to 25.000 euros. The maximum amount that will be excluded from the responsibility cannot exceed 275.000 euros.
The second type of company will work like a limited company except that the owners will have the possibility to increase the capital later on. The company will be considered ‘limited responsibility’ at all effects only when the capital of 3000€ will be reached.
Residence permits and visas:
As in other EU countries, the Spanish government will grant residence permit/ visas to foreigners (non EU citizens) in the following cases: * investment projects creating a large number of jobs, * individuals buying property for more than half a million Euros, (initially was set in 160.000 euros), * if they purchase 2.000.000 euros on Spanish national debt, * or for highly skilled professionals and researchers.
There will be of course many other mandatory requirements like clean criminal records and enrolment into a private medical insurance scheme.
Access to credit for SMEs
80% of Spanish SMEs are obtaining credit through banks. This credit channel is far too expensive for small companies to afford; therefore SMEs will be allowed to obtain credit by issuing bonds on the new MARF (Mercado Alternativo de Renta Fija, in Spanish Alternative bond market). This new market is in the process of being created and regulated.
New insolvency procedures for SMEs
When the debt of a company is below 5 millions Euro, it will be possible to negotiate a way out with creditors without having to file for insolvency in court. This new extrajudicial form of settlement will be managed by a “mercantile mediator”, which will try to reach an agreement in the best interest of all the parties. If no agreement can be reached the standard judicial procedure will be followed.
Reductions of social security contributions in cases of multiple jobs
People working for several employers or being both employed and self-employed will be able to pay reduced social security contributions. This will be 50% of the minimal contribution for the first 18 months and 75% for the following year and a half.
These are just few of the many changes that this new law will introduce and it is hoped that the government will put in place these measures as soon as possible.