Tag: Business

ERTE – Temporary Suspension of Employment

ERTE – Temporary Suspension of Employment

(This article was updated here and here) Due to the Corona virus crisis, many Spanish companies (think of airlines, hotels, restaurants, leisure sectors) are now proceeding to suspending employment temporarily. The so called ERTE, or Temporary Suspension of Employment procedure allows employers to suspend work or reduce working hours in case of Force Majeur (the Spanish Ministry of Labor has qualified the Covid19 crisis as such). This procedure is not to be confused with the so called ERE, which has a definitive character, i.e. the employment finishes. In the UK a similar procedure is furlough. Continue reading “ERTE – Temporary Suspension of Employment”

Board or joint and several directors?

Board or joint and several directors?

Foreign companies often ask what the best form of governance/ management is for their subsidiary in Spain. A “Board of Directors or joint and several directors of a limited liability company in Spain?” Of course this depends on the trust relationship the mother company (the shareholder) has with the management of the Spanish company. Most efficient would be the joint and several director system, that director will be able to manage most the daily business of the Spanish company without having to recur to other directors (in case there are more directors. In case there is only one, it would be a “sole director” automatically having the same faculties as a joint and several director). The same can however be achieved through a board of directors appointing from their midst a managing director (a “consejero delegado” established in article 249.2 of the Spanish “Ley de Sociedades de Capital” – Law of Capital Companies). Sometimes the impression is created that a board of directors guarantees more control over the operations of the Spanish sub. That is not necessarily true.

We have set up and worked with many Boards of Directors and or joint and several directors, or sole directors. Feel free to contact us to discuss what a suitable governance body would be for your subsidiary company in Spain. It all depends on the circumstances.

You may appoint foreign directors (individuals or companies) without any problem, they will need a Spanish tax number though. A so called Numero de Identificación Fiscal (a “NIF”) and in case of foreigners, a NIE, a Numero de Identificación de Extranjeros. We can help in obtaining that number.

Next time you ask yourself, Board or joint and several directors? Contact us or dial direct 0034 610 739 364 if you would like to discuss what could be the adequate form of governance for your company.