Incorporating a company is the procedure by which a legal entity is created with the capacity to operate in the market. This procedure requires the intervention of a notary who authorizes the deed of incorporation. The document has probative value and is a requirement for registration in the Commercial Registry.
Many entrepreneurs wonder if it is possible to carry out the entire process without physically attending a notary's office. The answer is yes. The regulations allow signing by videoconference. This makes life easier for partners residing in different cities or with complicated schedules.
Requirements for Incorporating a Company
To create a limited company, several elements are needed. The minimum share capital is 3,000 euros. This amount must be deposited into a bank account in the name of the company being formed. The bank provides a certificate that is incorporated into the deed.
The name of the company cannot be the same as another already existing one. That is why the negative certificate of denomination is requested from the Central Commercial Registry. The procedure is done online and the result arrives in a period of between one and three days.
The bylaws are another essential requirement. In them the corporate purpose is defined, that is, the activity to which the company will dedicate itself. The registered office, the form of administration and the rules for adopting resolutions are also established. It is advisable that a lawyer review the bylaws before signing the deed.
The partners must have legal capacity to contract. If any is a foreigner, they need an NIE. All must provide their valid identification documents.
Detailed Steps of the Incorporation Process
The first step is to agree among the partners on the conditions of the future company. The corporate purpose, the capital and the distribution of participations are decided. Then the company name is reserved.
Once the negative certificate is obtained, the bank account is opened and the capital is deposited. With the bank certificate in hand, the deed is prepared.
The notary is contacted so that they draft or review the document. When the text is approved, the signing date is set. This is where the possibility of signing by videoconference, regulated by Law 28/2023, comes into play.
After the deed is signed, the Tax on Property Transfers and Documented Legal Acts is settled. The applicable rate is 1 percent on the share capital. The deadline to submit form 600 is 30 business days.
Finally, the deed is submitted together with the tax settlement to the Commercial Registry. The registrar has 15 days to qualify it. Once registered, the company acquires full legal personality.
Notarial Signing by Videoconference
Law 28/2023 regulates the signing of notarial documents by videoconference in Spain. The process begins with a description of the case. The identity of the appearing parties is verified using secure systems. The video call in which the notary participates is scheduled.
In the video call, it is confirmed that all the people are who they say they are. The notary explains the content of the deed. Each appearing party expresses their conformity. The signature is carried out with recognized digital certificates. The notary gives faith to the act and protocols the document.
This way of acting reduces travel costs and allows coordinating complicated agendas. The act has the same validity as an in-person signature.
Practical Case: Incorporation of an SL with Partners in Different Provinces
Carlos, a programmer from Valencia, decided to set up a mobile applications company with two old university classmates. One lived in Bilbao and the other in Granada. All three had full-time jobs and found it impossible to coincide in the same city on the same day.
They prepared all the information: corporate purpose focused on software development, capital of 6,000 euros in equal parts, joint administrators. They obtained the negative certificate in two days. They deposited the capital in an online account from a bank that issued the certificate digitally.
They sent us all the documentation. We reviewed the bylaws and prepared the deed. We scheduled a video call at 4:00 p.m. on a Wednesday. The three partners connected from their respective cities. The notary explained each clause to them. They all expressed their will to constitute the company in the proposed terms. They signed electronically. The deed was protocolized that same day.
The following day the AJD tax was settled, which amounted to 60 euros. It was submitted telematically to the Commercial Registry of Valencia. The registration took place 11 days later. Carlos received the digital simple note stating the incorporation of the company. In less than three weeks from the first contact, the company was operational.
Usual Costs and Timeframes
The amounts to be anticipated when incorporating a company are several. The share capital is not an expense but a contribution that remains in the company. The other concepts do represent a disbursement.
| Concept | Approximate Amount in Euros |
|---|---|
| Minimum Share Capital for SL | 3,000 |
| Notarial Fees for Incorporation | 400 - 650 |
| Registration in Commercial Registry | 150 - 300 |
| AJD Tax (1% of the capital) | 30 (for minimum capital) |
| Certificates and Agency Fees | 200 - 500 |
The total disbursement not counting the capital is usually between 800 and 1,500 euros depending on the complexity. The timeframes are also important. From the signing of the deed until the registration, normally between 10 and 20 business days pass.
These procedures can be done online through videoconference with the notary.
Differences Between the Main Company Types
Before deciding what type of company to create, it is advisable to compare the options. The limited company and the public limited company are the two most used.
| Characteristic | Limited Company (SL) | Public Limited Company (SA) |
|---|---|---|
| Minimum Share Capital | 3,000 euros | 60,000 euros |
| Liability of the Partners | Limited to the contribution | Limited to the contribution |
| Minimum Number of Partners | 1 | 1 |
| Transfer of Participations or Shares | Limited by the bylaws | Freer |
| Cost and Complexity of Incorporation | Lower | Higher |
The SL is the recommended option for most small and medium-sized projects. The SA is reserved for large operations or when an IPO is planned in the future.