What is the role of a legal representative?
Are you thinking about opening a business in Spain but don’t really know where to begin? Have you heard about the role of a legal representative? Read on to discover what they do and how they can help you.
A legal representative facilitates companies not currently established in Spain to buy and sell in our country.
This legal representative can be a person or a legal entity (known as a ,persona jurídica), and usually carry out one of the following roles:
- If your company is registered in a European country then you can voluntarily engage a legal advisor to act as a business advisor. Only in rare circumstances are European-registered companies required to have a legal representative.
- If your company is from a non-European country, it is obligatory to have a legal representative who is the authorized fiscal agent for the company.
Why is it better to have a legal representative?
As mentioned above, sometimes having a legal representative is obligatory and other times it is not. However, counting on the service of a legal representative for your company has the following benefits:
- Guarantee of Professionalism. By entrusting experienced professionals to handle your paperwork you can rely upon their deep understanding of Spanish legislation.
- Time saving. Expert handling of all the procedures means that paperwork is done in less time by a legal representative in Spain.
- Cost saving. By saving time you are also saving money and other resources too.
- Accelerated operations. The speed at which an expert in this field can act means that a company opens faster in Spain with the help of a legal representative.
How do you appoint a legal representative?
Nominating a legal representative for a business is a common occurrence for companies and the role they play can be varied, but it is important to do so properly.
The legal representative should be nominated through a power of attorney at a Notary Public office. It is important to bear in mind that:
- The legal faculties granted to the legal representative must be ample and not include limitations which may impede their ability to carry out their job on your behalf.
- The power of attorney must be affixed with the Apostille from the Hague Convention so that it is legally binding in Spain.
- The power of attorney must be translated by a certified legal translator.
- Once the power of attorney has been granted it must be logged with the Mercantile Registry.
As mentioned at the beginning of this post, the nominated legal representative for your business in Spain may be a legal entity such as a business or trading company. In such cases, one person should be named as a representative of that legal entity, as per article 143 of the Spanish Mercantile Registry Rules and article 212 bis of the Spanish Law of Corporations.
What can a legal representative do?
The power of attorney granted to the legal representative must cover all usual business requirements such as:
- The ability to establish a company. There are several steps such as requesting certificates from the Mercantile Registry, receiving formal recognition of the articles before a Notary Public, the payment of rates and placing the deeds with the Mercantile Register, which all need to be followed when setting up a company in Spain. The legal representative should have authorization to carry out all these steps through the power of attorney granted to him/her.
- The ability to hire staff. Having the power to offer labour contracts to future employees of the company is a necessary authorisation that the legal representative must receive through the power of attorney. They must be able to sign job offers, labour contracts and have the power to register employees with Social Security as well as to be able to cancel the employee’s relationship with the company in the eyes of the authorities, including being able to sign settlements and redundancy packages.
- The ability to rent office space or business premises. If the foreign company needs to hire office space or a business premises in Spain the legal representative should have enough authority via the power of attorney to be able to negotiate and sign lease agreements, to request bank guarantees and pay deposits with public administration bodies.
- The ability to submit tax returns. If the legal representative is also the fiscal representative of the company, he or she must be authorised to carry out procedures such as submitting tax returns, fill in paperwork and pay taxes to the Spanish Treasury.
- The ability to pay suppliers and employees. When a business begins to run it is necessary to pay suppliers (such as the internet provider, mobile phones and office material) and employees (paying salaries and other outgoings).
How can we help you if you need a legal representative?
Among the business advisory services that LEIALTA offers is that of legal and fiscal representation, including:
- Advice and support from the commencement of your business operations in Spain
- Liaise with the Spanish tax authorities
- Undertake the bureaucratic functions necessary to permit your business to work in Spain.
With our legal representative service and by offering fiscal representation you can be sure that you are fulfilling Spanish legal requirements and that you can begin operating in Spain as quickly as possible.
Leialta website: https://www.leialta.com/en/
Blog for doing business in Spain: https://www.leialta.com/en/blog-for-doing-business-in-spain/