Understanding Spanish Company Legal Forms

Classification of Companies and Their Legal Forms

Sole Trader (Empresario Individual)

• Name: Uses the name of the holder.
• Registration: Recommended to register with the Mercantile Register.
• Nature: A natural person routinely exercising a business activity on their own account.
• Liability: Personal and unlimited; the individual answers for business debts with all their assets.

Public Limited Company (Sociedad Anónima - S.A.)

• Name: Must be distinct from other companies to avoid confusion.
• Formation: Requires a public deed, publication, and registration in the Mercantile Register.
• Capital: Divided into shares belonging to the shareholders.
• Liability: Limited to the capital contributed by shareholders.
• Capital Contributions: Can be made in cash or assets.
• Minimum Capital: Currently €60,000. At least 25% must be paid up at incorporation. (The original text referred to an outdated value of 10 million pesetas).
• Management: Decisions by administrators or shareholders typically require an absolute majority.
• Legal Framework: Governed by commercial law; the deed of incorporation must be registered and include the company's name and capital.

Limited Liability Company (Sociedad de Responsabilidad Limitada - S.L.)

• Name: Must be distinct from other companies.
• Formation: Requires a public deed, publication, and registration in the Mercantile Register.
• Capital: Divided into participations (shares).
• Liability: Partners' liability is limited to their capital contribution.
• Partners: Minimum 1, maximum 50 partners.
• Capital Contributions: Can be made in cash, work, rights, or assets.
• Minimum Capital: Currently €3,000. Must be fully paid up at incorporation. (The original text referred to an outdated value of 3,005.06 pesetas).
• Management: The General Meeting is the decisive body.
• Legal Framework: Governed by commercial code and specific limited liability company law.
• Transferability: Participations are generally not freely transferable.

General Partnership (Sociedad Colectiva)

• Management: Managed by one or more general partners on behalf of all members or some.
• Formation: Requires a public deed, publication, and registration in the Mercantile Register.
• Contributions: Partners contribute assets and/or work.
• Liability: Personal, joint and several, and subsidiary.
• Partners: Minimum 2 partners.

Limited Partnership (Sociedad Comanditaria)

• Name: The names of all partners may not appear in the company name.
• Formation: Requires a public deed, publication, and registration in the Mercantile Register.
• Structure: A type of partnership with two types of partners:
  • General Partners (Socios Colectivos): Manage the company and have unlimited, joint and several liability.
  • Limited Partners (Socios Comanditarios): Do not manage the company and their liability is limited to their capital contribution.
• Partners: Minimum 2 partners.

Labor Company (Sociedad Laboral)

• Formation: Must be established by public deed and registered in both the Mercantile Register and the Register of Labor Companies.
• Structure: A Limited Company (S.L.) or Public Limited Company (S.A.) where the majority of shares/participations are owned by workers who have a permanent employment contract with the company.
• Partners/Members: Minimum 4 members.

Cooperative Society (Sociedad Cooperativa)

• Formation: Requires a public deed and registration in the Cooperative Register, including the names of the members.
• Purpose: Constituted by people who associate to satisfy common needs or economic and social aspirations.
• Liability: Limited in proportion to the contribution of each member.
• Members: Minimum 4 members.