Duties of a Company Director of a Spanish Limited Company (Sociedad Limitada – SL)



The Sociedad Limitada (SL), the Spanish name for Limited Liability Company  (LLC), is the most common form of company in Spain and is similar to a limited company in other countries.  Like any form of company, a Sociedad Limitada (SL) is aimed at performing all sorts of commercial activities subject to commercial law. It is composed of a limited number of partners, it requires a minimum of capital, and the liability of the owners is also limited.

To incorporate a Sociedad Limitada in Spain the appointment of a company director is required.  It can either be a Sole Director, Joint Directors, Joint and Several Directors, or a Board of Directors composed by a minimum of three members.

This article provides an overview of the implications and duties of a company Director of a Sociedad Limitada.
Duties of a company director


A company director manages and runs the day-to-day decisions of the company and has full authority to represent the company in all activities related to the company’s corporate purpose.  This authority cannot be limited as regards to third parties.


In the case of the joint directors, each director can act independently and represent the company. However, in the case of joint and several directors, all members must agree on all acts or contracts entered into by the company.
The first director’s duty is to comply with tax and social security issues. Below are the instances in which a Director must register as an “autónomo” (freelancer), a legal figure in Spain, as regulated in the Additional Provision 27th of the General Law of the Spanish Social Security RDL 1/1994 of June 20th(Disposición Adicional 27ª de la Ley General de la Seguridad Social (RDL 1/1994 de 20 de junio):

  • Directors with effective control of the company must register as an autónomo (freelancer) in Spain;
  • If the director has been assigned a wage;
  • Whenever the director has actual control of the company (at least half the capital);or when the director happens to be the ultimate beneficiary.
  • When he has a stake equal to or greater than a third of the capital;
  • When the director exercises functions of management and has a percentage of at least 25% of shares in the Company.

The role and responsibilities of the directors are usually regulated in the statutes of the company, or through a Shareholders’ Agreement, which will delimit their role and how to perform their obligations. However, the Spanish Corporations Act regulates a number of basic obligations that the directors must comply with as representatives of a company:

  • Perform their duties diligently and loyally to defend the interests of the company.
  • Must not use the name of the company to conduct business of their own, or take advantage of their position to make business operations for personal gain.
  • Have the obligation to inform the other partners of any conflict of interests with the company, especially those involving competition.
  • Must keep secret any confidential company information, even after their removal or resignation, and should never share any information that may entail negative consequences for the interests of the company.

If they fail to fulfil these obligationsthey may have to respond with their own assets for the damaged caused.
Directors are also responsible for the following duties:

  • Lodge the incorporation deed at the Mercantile Register;
  • Update the shareholders’ book;
  • Call general meetings;
  • Represent the company;
  • Prepare and disclose the annual accounts and the directors’ report;
  • Call a general meeting to dissolve the company, if it is to be dissolved;
  • Challenge resolutions of the general meeting when they are contrary to the objects of the company; and
  • Keep the minutes book

Third party liability

The Spanish Corporations Act states that a corporation may have a cause for dissolution when “it causes losses that reduce the company`s worth to less than half its initial capital.” To avoid this situation the company must raise its capital or reduce it to a sufficient extent, as long as it is not appropriate to request the filing for bankruptcy.
If the company is clearly in the event of dissolution the director is required to call a general meeting within 2 months to adopt the agreements to, either approve the dissolution of the company, increase capital, or agree on a capital reduction. If the director fails to comply with this obligation he or she may be liable for all amounts owed to any creditor acquiring the company after its dissolution.


Being a company director is a serious commitment. Directors represent the company and manage its daily activities, and in principle, are not liable for the acts or debts of the company, provided they act diligently and in accordance with the law. It is, therefore, imperative that directors know the limits of their duties in accordance with the law, statutes or, where appropriate, derivatives of a Partnership Agreement.




Huffington Post Arabi hires  Spanish firm Del Canto Chambers

The Huffington Post has recently launched its Arabic edition. The launch is the result of nearly two years of negotiations managed by the firm DelCantoChambers in London, which has solved the complexities of launching an media such as the Huffington Post simultaneously in 20 Arab countries with different legislation.

Commenting on the launch, the lawyer Leon Fernando Del Canto, company founder of Del Canto Chambers says: “We have been privileged to see how this project was born and advise on it form the begining. Working with Wadah Khanfar and Arianna Huffington is a lesson in optimism on the future of journalism. ”

The giant media created by Arianna Huffington already has local editions in eight countries, including Spain, where it is published in collaboration with media group PRISA. The new edition marks the opening of the first media of this nature in the Arab world, which makes “independent and original journalism” and will be a platform for new generations of bloggers in the Middle East.

In the words of Leon Fernando Del Canto, “the Huffington Post in Arabic will give voice to many young people with a mobile phone and something important to say. Young people who nobody has heard yet.”

The new platform, entirely in Arabic and directed from London, adds to the French version of the Huffington Post that targets the North African countries.

For more information visit www.delcantochambers.com

¿Cual es la posición fiscal de un español que trabaja en Qatar?



Un ciudadano Español que trabaja en Qatar tributaría como no residente de acuerdo al IRPF en dicha modalidad. Incluso si sus ingresos los recibe en España, toda vez que los mismos procedan de su trabajo en el Estado de Qatar y ello pueda acreditarse mediante contrato de trabajo y certificados correspondientes de las autoridades Consulares y Qataries correspondientes.

Es fundamental acreditar igualmente que la residencia efectiva es en Qatar.

Por ejemplo, si una empresa desplaza un trabajador, junto con su familia, por tiempo indefinido a Qatar, el trabajador puede tener certificado de residencia fiscal en Qatar, prestar sus servicios en una empresa con sede qatarí, y que los rendimientos le sean satisfechos directamente desde España.

Pueden surgir dudas al respecto de la tributación de la renta del trabajador en España en el ámbito del Impuesto sobre la Renta de no Residentes.

En este caso, se debe tener en cuenta que Qatar es un país con el que España no tiene en vigor un Convenio para evitar la doble imposición, por lo que la tributación en España del no residente será la que se derive de la aplicación de los dispuesto en la legislación de no residentes, compuesta por el texto refundido de la Ley del Impuesto sobre la Renta de no Residentes, aprobado por el Real Decreto Legislativo 5/2004, de 5 de marzo (TRLIRNR) y su reglamento de desarrollo aprobado mediante el Real Decreto 1776/2004, de 30 de julio (BOE de 5 de agosto).

En concreto, el artículo 12 del TRLIRNR establece que estarán sujetas al impuesto las rentas obtenidas en territorio español por no residentes, desarrollando el artículo 13 que rentas se entienden obtenidas en territorio español. En cuanto a los rendimientos de trabajo, el apartado 1.c) los considera obtenidos en España:

1º. Cuando deriven, directa o indirectamente, de una actividad personal desarrollada en territorio español.

2º. Cuando se trate de retribuciones públicas satisfechas por la Administración española.

3º. Cuando se trate de remuneraciones satisfechas por personas físicas que realicen actividades económicas, en el ejercicio de sus actividades, o entidades residentes en territorio español o por establecimientos permanentes situados en éste por razón de un empleo ejercido a bordo de un buque o aeronave en tráfico internacional.

Lo dispuesto en los párrafos 2.º y 3.º no será de aplicación cuando el trabajo se preste íntegramente en el extranjero y tales rendimientos estén sujetos a un impuesto de naturaleza personal en el extranjero.”.

Por lo tanto, en la medida en que el rendimiento obtenido por el trabajador no residente en España derive, directa o indirectamente, de una actividad personal desarrollada fuera del territorio español, no quedará sujeto al Impuesto sobre la Renta de no Residentes.


Time to review corporate structures to own property in Spain

The Spanish Tax Agency is taking a very broad interpretation of the Wealth Tax (Impuesto de Patrimonio) regulations as applicable to Trusts, as they are considered transparent or look-trough entities.

This will affect Spanish property owners using corporate structures owned ultimately by a Trust.
It has been common practice for a variety of reasons such as asset protection strategies or inheritance planning for non-residents to buy Spanish real estate through a corporate structure.

Historically such structures are not considered within the scope of the Spanish Net Wealth Tax (NWT), under national legislation nor double taxation agreements (DTAs) with other countries.
If this is the case, it is fundamental to analyse the trust deed and determine if the trustee, beneficiary or settlor will be considered the owner for Wealth Tax purposes.

The approach will change depending on the tax residence of the final beneficiary and if there is a DTA agreement signed with Spain or if the jurisdiction is classified as a Tax haven.

Most DTA agreements signed by Spain did not include the possibility of indirect participation in the Spanish real estate corporate ownership. As such, under those DTA, possession of Spanish real estate through a company did not come within the scope of the Spanish tax system.

However, currently some DTA are being renegotiated, and new provisions on real estate are being introduced with the aim of including such tax structures into the Spanish Wealth Tax.

In recent resolutions, the Spanish tax authorities have taken a very broad view of the DTA clauses and consider that they are now entitled to tax the shareholder of a company with real state assets situated in Spain.

Therefore, it is time to review corporate structures to own property in Spain.

The 1st “Andalusian Investment Conference” will be held in Qatar

Press Release

The 1st “Andalusian Investment Conference” will be held in Qatar

First Andalusian Investments Conference

Jerez de la Frontera, Spain, Abril 2011…// “Sharish Qatari Consulting” will sponsor the first “Andalusian Investments Conference” in the Gulf. The conference will discuss available investment opportunities in Andalusia, Spain, and aims to attract investors from the Gulf Region in general and specially from Qatar.

“Sharish Qatari Consulting” was founded by Leon Fernando del Canto (Konsilia Tax Legal – Spain), Izaz Ali (Lawdit Solicitors – UK) and Aize Al-Adba (Qatar lawyer).

Leon Fernando says:
“This First Andalusian Investment Conference focuses specifically on Andalusian living. We bring the most exclusive resorts for the international resident and investor. We believe them to be of interest to Qataris considering a second residence in Europe.”

This event will be a great opportunity to interact with experts on the Economy, Culture and Society of Andalusia. The speakers will include a selected range of professionals: lawyers from Spain and the UK, as well as solicitors and barristers with more than 25 years experience in Andalusian investments. Topics such as legal, tax and the financial environment and investment vehicles and opportunities will be discussed.

The conference will be held on the 1st of May, at the Four Seasons Hotel in Doha (www.fourseasons.com/doha/), the hub of the financial centre, and includes some examples of high-end property investment opportunities in Spain, like Marbella, Sotogrande and Jerez de la Frontera. This event will attract investment government agencies, fund managers, family offices and private investors by invitation.

To confirm attendance: +974 44101885, +34 902 555045 or by email mercedes@konsilia.es

Further information:

Donwload Brochure on PDF format
Press Officer:
Natalia Kim – Mobile: (+34) 608-59 50 10 – Email: info@promopress.com
Skype: Nataliakim