Do you want to encourage labor integration of people with disabilities and have a reserve in your favor in public tenders? If the answer is yes, it is important that you know how to create a foundation in Spain, what requirements must be met and what are the particularities of the process.
One of the ways for people with disabilities to access the labor market is through special employment centers. These are companies in which 70% or more of the workforce must be made up of people with disabilities. In the case of a special employment center with social initiative, in addition to the benefits provided by a SEC, you can also get the advantage of a reserve in your favor in public tenders.
A SEC can be a foundation, an association or a social economy entity. The law establishes that special employment centers with social initiative are those that are promoted or participated in more than 50%, directly or indirectly, by one or more entities, whether public or private, that are non-profit organizations or that have their social character recognized in the bylaws.
- How to create a foundation in Spain: what is needed?
- 1. Elaboration of the basic statute
- 2. Submit of the draft of statutes in the Register of Foundations.
- 3. Request the negative certificate at the Register of Foundations
- 4. Payment of the initial endowment
- 5. Request of provisional NIF and liquidation of the ITP and AJD
- 6. Granting of the public deed of incorporation
- 7. Registration in the Register of Foundations
- What is the minimum amount required to establish a Foundation?
How to create a foundation in Spain: what is needed?
As we have seen, the foundation is one of the forms that a SEC can take. The steps to create a one are as follows:
1. Elaboration of the basic statute
The first step consists of creating bylaws that reflect the will of the founder(s) of the entity and, therefore, its corporate purpose. At this point, we must consider three important issues:
- In the case in which the objective is to be qualified as a special employment center with social initiative, it is necessary to make reference to that purpose in the bylaws: creation of a SEC to promote the labor and social integration of people with disabilities.
- Another aspect that the bylaws should refer to is the full reinvestment of profits for the creation of employment opportunities for people with disabilities.
- Finally, the bylaws must regulate the structure of the board of trustees (there must be at least three trustees, a president, a member and a secretary), the registered office of the foundation and the type of liability of the trustees (joint and several or joint liability). The role of the trustees is very important, since they must ensure the proper functioning and sustainability of the organization. In fact, trustees must be either informed or asked for permission when it comes to the sale of assets or modification of the bylaws.
2. Submit of the draft of statutes in the Register of Foundations.
It is advisable that, once the draft of the statutes are ready, they are submitted to the relevant Register of Foundations (to determine where to submit this draft, it will be necessary to know whether the foundation to be set up is a state foundation or a foundation in a specific Autonomous Community). The purpose of this step is that, before legalizing the deeds and the by-laws, the relevant Registry of Foundations gives us its conformity to the content of the by-laws and warns us of possible errors before going to the notary’s office.
3. Request the negative certificate at the Register of Foundations
The next step is to verify that the name we want to give to the foundation has not been registered yet. To do this, a negative certificate of the name must be requested at the Register of Foundations, state or regional, depending on where you want to establish the foundation.
4. Payment of the initial endowment
Next, the initial endowment of the foundation must be paid. The minimum amount is 30,000 euros.
5. Request of provisional NIF and liquidation of the ITP and AJD
Once the deposit of the initial endowment has been made, the provisional NIF of the foundation must be requested at the Tax Agency (AEAT). The Property Transfer Tax and the Stamp Duty tax (ITP and AJD) must also be paid.
6. Granting of the public deed of incorporation
Once all the previous steps have been executed, it’s time to grant the public deed of incorporation of the foundation to a notary. For it, the following documents must be provided:
- Statutes of the foundation.
- Provisional NIF given by the AEAT.
- Bank certificate that accredits the payment of the initial endowment for an amount of 30,000 euros.
7. Registration in the Register of Foundations
The last step that needs to be taken in order to create a foundation consists of requesting its registration at the Register of Foundations, for which the public deed of incorporation, the provisional NIF and the proof of the payment of taxes must be provided.
Once the foundation is formally registered in the Register of Foundations, it begins to have its own legal personality.
What is the minimum amount required to establish a Foundation?
To create a Foundation in Spain, it is necessary to have an initial foundational endowment of at least 30,000 €, which can be monetary or non-monetary.
Monetary endowment: 25% of the €30,000 must be contributed at the beginning, and the rest within a maximum period of 5 years. What if the initial endowment is less than €30,000? In that case, the founder must justify that the amount is sufficient by presenting an action program together with the economic study that proves the viability.
Non-monetary endowment: it can be either goods or rights of another nature.
Important: if you are going to create a foundation, you must know how to give part of your goods and rights to the foundation, and you’ll have to reinvest the benefits obtained on it. The capital you contribute comes out of your patrimony and won’t be recouped due to the reinvestment of the profits for the same purpose. You can see a post about this on our LinkedIn: here.
If you are wondering whether it is profitable to create a foundation or what a foundation is for, it is essential that you assess not only the economic aspect or the tax benefits you can get, but also the possibility of helping other people and improving the image of your company, as well as promoting corporate social responsibility. In Leialta we have a social consulting department that is responsible for supporting the creation of foundations and giving full advice.
Leialta website: https://www.leialta.com/en/
Blog for doing business in Spain: https://www.leialta.com/en/blog-for-doing-business-in-spain/