1E9Ct5D

Foreign Investments in SpainWhen incorporating a new company or when pre-existing shares are being acquired before aNotary Public, a special form (D-1A) shall be signed by the foreign investor and later lodged inthe Foreign Investment Registry with a copy of the transaction document.Management BodyA board of directors, a sole director, two joint directors or two joint and several directors cancompose the management body of an SA. The form selected must be stated in the by-laws. It canbe changed at any time by the shareholders’ meeting. If a board of directors is created, it musthave a minimum of three members. There is no maximum. The members of the governing bodycan either be Spanish or foreign citizens.The term of the post is to be set at the by-laws and cannot exceed six years, but can be renewedfor equal periods indefinetly.The chairman is engaged in summoning and chairing the board but has no casting vote, unlessotherwise provided in the by-laws. The secretary can either be a board member or non-boardmember and is the person in charge of issuing the certificates of the corporate resolutions andgranting the relevant deeds. The legal advisor of the company usually occupies this post. Powersof attorney to conduct day-to-day business can be granted to any of the board members or anemployee of the company.Business purpose, domicile, duration and restrictionsTogether with the above explanation, some other aspects have to be foreseen: (i) the businesspurpose of the company, which shall be accurate and precise and usually establishes the generalframework for the activities of the company, (ii) the duration of the company, usually the by-lawswill stipulate that the duration is indefinite (iii) the corporate domicile, which must be located inSpain, (iv) the restrictions, if any, on the free transferability of shares or (v) the accounting yearend,on 31 st December.Limited-Liability CompanyThe limited-liability company (SL) is a company that allows one or more founding partners(either individuals or entities) that must subscribe to the entire, fully paid-up share capital. Thenumber of investors in this type of company is unrestricted.This type of company is currently the most used investment vehicle in Spain, specially amongstart-up projects and new entrepreneurs The capital of the company is divided into equalparticipations, which must be fully paid-up and are not freely transferable. The subscribers’11