Spanish Company Statutes
Accounting Period
If not stated expressly, the company will be deemed to end its accounting year on December 31. The accounting year can terminate at any date as long as it does not exceed twelve months.
Administrators/Directors
Board of Directors, sole director or joint directors must be stipulated in the Statutes, but can be changed at any time by the Shareholders Meeting. In the case of Board of Directors the Statutes or the Shareholders' Meeting will establish the number of members which may not be lower than three. In this case there will also have to be a secretary of the Board of Directors which may or may not be member of the Board.
Domicile/Registered Office
It must be in the province of Spain where the company has been incorporated, even though it may be changed at a later date.
Company name
A name reservation has to be made in advance with the Spanish Mercantile Registry. In the application to reserve the name of any company 3 choices may be included. The registry is very strict and disallows many names where a similar name exists.
Object clause
The company's activity should be stated in the statutes in a clear, concrete and well-defined manner. It establishes the general framework for the activities of the company. Those used to models elsewhere will be surprised that there cannot be a clause allowing the company to do any activity.
Pre-Emption Rights
Normally some pre-emptive rights for the acquisition of the company shares are always granted to the company shareholders.
Responsibilities of Officers
- Directors have a duty to keep themselves informed about the company's activities.
- Directors have a duty to act with loyalty to the corporate interest, which is to be understood as the interest of the company itself.
- Directors have a duty to refrain from using the name of the company, or their position as directors, in order to conclude transactions on their own behalf or with related parties. Refrain from knowingly taking advantage, on their own behalf or for related parties, of any investments or transactions related to the company's assets, when such investments or transactions would have been offered to the company or the company could have been interested in them, unless the company has rejected the investments or transactions and such rejection has not been influenced by the relevant director. Report to the board any direct or indirect conflict of interest that they may have with the company. In the event of conflict, the relevant director will refrain from taking part in the transaction and must report the conflict in the annual report on corporate governance. Report any shareholdings in companies whose activities are similar or complementary to the activities of the company, together with the activities that the director undertakes in such companies and the exercise, in person or on behalf of third parties, of such activities. This information must also be disclosed in the annual report on corporate governance.
- Directors must keep confidential any information that they are aware of due to their position where disclosure may be contrary to the interests of the company. There is an exception to this duty of confidentiality when directors are required by the regulators to disclose information or when the law so requests.
The shareholders meeting as in other countries corporate regulations is the supreme governing body. The shareholders meeting must be held at least once a year to approve the company financial year accounts.
Transferability of shares
For both types of companies, S.A. or S.L., some restrictions or conditions can be established to regulate the transfer of the company shares.