Know more about the Spanish law Crea y Crece

The law aims to make entrepreneurs’ life easier and ease the risk of late payments through electronic invoicing. Please see below for detailed information on objectives, key measures, and how this affect your business to help you navigate the new legal framework.

Objectives

• Create a legal framework that encourages and facilitates business creation and stimulates economic growth.
• Fighting against late payments.
• Facilitating access to funding.
• Removing regulatory barriers to economic activities.

Key Measures

• Incorporate companies digitally and quickly through the Entrepreneur Service Point (PAE), the Single Electronic Document (DUE), and the Information Centre and Business Creation Network (CIRCE).
• Extend the catalogue of economic activities exempt from prior licensing.
• Establish the average payment period as an assessment criterion for eligibility for grants and subsidies.
• Public procurement.
• Incorporate limited liability companies (LLC) with only Euro1 of share capital and use the resources freed up for alternative uses.
• Companies' duty to include their average payment period in the CAAC report.
• Encourage the use of electronic invoicing in transactions between entrepreneurs and professionals.
• Make alternative funding mechanisms more flexible by introducing a new legal regime to allow crowdfunding platforms to provide their services freely in Europe.
• Promote investment in venture capital by broadening the type of companies in which these entities can invest in.
• Increasing claim legitimacy for the protection of market unity.

How does this new law affects your business?

Creates a legal framework that encourages and facilitates business creation.

• Promotes the use of public deed with standardised format and standard statutes for the incorporation of LLC.
• Facilitates access to the creation of companies for groups with fewer economic resources. As long as the share capital does not reach the figure of EUR3,000, at least twenty percent (20%) of the profit must be allocated until this reserve, together with the share capital, reaches the figure of EUR3,000.

Fights late payments

Imposes the mandatory use of electronic invoicing for companies and professionals when they engage in commercial transactions with each other.. This implies:

• Reduce costs (e.g. Digital Toolkit Programme).
• Greater control and traceability of payments.
• Reduced liquidity problems for companies, especially SMEs.
• Fines of up to EUR10,000 for companies that do not use electronic invoices.
• Ineligibility for any type of public aid or subsidy in the event that the company is in debt to any public administration.

Creation of a State Observatory on Private Debtors.

Removes regulatory barriers to economic activities

• Extends the legal standing is extended so that any natural or legal person can defend freedom of establishment and movement against the administration.
• Extends the activities exempted from prior installation, operations, or activity licences (e.g. market research, comprehensive services, postal and telecommunications companies).

Facilitates access to finance

• Establishes a single individual investment limit per project for retail investors between EUR1,000 or 5% of wealth. Above this limit, they will receive a risk warning and will have to provide their express consent.
• Considers shares in LLCs as eligible securities for the activities of crowdfunding platforms and investment services firms.
• Reduces from 50% to 25% of the minimum percentage of capital required to set up venture capital companies (SCR).
• Establishes the possibility of incorporating Closed-Ended Collective Investment Undertakings Management Companies (SGEICs) in the form of LLCs.