ELZABURU

Main novelties of the Business Creation and Growth Law

On October 19, 2022, Law 18/2022, of September 28, on the creation and growth of companies, came into force, after its approval by the Cortes Generales. Its main objectives are the following:

Improve the business climate to boost business creation and growth through the adoption of measures to streamline business creation
Improve regulation and elimination of obstacles to the development of economic activities
Reduction of commercial late payments
Improve access to financing

To materialize these objectives, the legal text introduces a series of new features that we detail below:

Constitution and digitalization of companies

The legal minimum of 3.000 euros to be able to establish a Limited Liability Company becomes 1 €, but taking into account the following:

It should be allocated to the legal reserve of the company a figure at least equal to 20 percent of the profit until said reserve together with the share capital reaches the amount of 3.000 euros.
In the event of liquidation, if the company's assets were insufficient to meet the payment of corporate obligations, the partners will respond jointly of the difference between the amount of 3.000 euros and the subscribed capital figure.

This first measure seeks to promote the creation of companies by lowering their incorporation costs (both registration and notarial), expanding the options of founding partners regarding social capital according to their needs and preferences, as well as reducing possible incentives to create. companies in other countries with lower incorporation costs.

Likewise, reforms are introduced to facilitate and promote the constitution of companies in a manner fast, agile and telematic, through the Information Center and Business Creation Network (CIRCE) and through the Use of the Single Electronic Document (DUE), reducing registration and notarial costs.

Measures to combat commercial late payment

Excessive late payments are common in our country, with small companies having higher delinquency and non-compliance rates as they do not have the position of economic and financial strength of large companies.

To promote a change in business culture, first of all, the Government will create the Delinquency Observatory national that will be responsible for monitoring the evolution of payment data and promoting good practices.

Second, the Electronic bill, as it is a useful instrument to reduce transaction costs and facilitate access to information on payment terms, it will expand its scope of use, so it will be mandatory to issue and send them to all companies and self-employed workers in their relationships. commercial.

It is important to keep in mind that, today and for several years, the use of electronic invoices is a widespread practice among companies and individuals. In fact, since January 2015, the electronic invoice (e-invoice) is mandatory for all companies that have commercial relations with public administrations and that exceed the amount of 5.000 euros.

Consequently, the legislator's purpose is to make its use mandatory in todas commercial relations between companies and the self-employed in our country, there being a transition period that will be developed by regulation by the Ministries of Economic Affairs and Digital Transformation and of Finance and Public Service with the aim of establishing the requirements Technical and insights, the requirements of interoperability minimum and requirements security,, control y standardization of the computer devices and system that generates the documents. The deadline for its approval will be six months from the publication of the Law in the BOE, that is, until March 29, 2023.

In this sense, one year after its approval, its use will be mandatory for businessmen and professionals with an annual turnover of more than eight million euros, while two years after its approval, it will be mandatory for the rest of businessmen and professionals.

Thirdly, subsidy programs are proposed that will allow the acquisition and massive implementation of digitalization solutions (ie: adoption of electronic invoice), highlighting the Program Digital Toolkit endowed with more than 3.000 million euros in subsidies.

Finally, an average payment period (60 days, as established in article 4.3 of Law 3/2004, which establishes measures to combat late payment in commercial operations) is included as a requirement for access to subsidies and as a cause for resolution and penalizable condition in public procurement.

Therefore, those companies and self-employed workers who want to access subsidies for an amount greater than 30.000 euros will only be able to obtain said aid if they comply with the payment deadlines, which are 60 days for operations between companies, which must be proven by presenting a responsible declaration.

Participatory financing platforms or through crowdfunding

A new legal regime is introduced for this type of platforms that seek to obtain financing from a plurality of subjects with the aim of allocating it to a specific project, based on Regulation (EU) 2020/1503 of the European Parliament and of the Council, of 7 October, 2020, regarding European providers of crowdfunding services for companies.

The main novelty of the Law is that this type of organizations will be able to provide their services freely without the need to obtain a different authorization in each of the Member States.

That is, these platforms will have to request authorization from the competent authority of the Member State in which they are established to operate as a provider of participatory financing services. The European Securities and Markets Authority (ESMA) will then be informed so that they can operate throughout the European Union.

Likewise, some of the main new features introduced by the standard in relation to the obligations of this type of operators are the following:

Portfolio management: The participatory financing service provider will be allowed to invest funds on behalf of the investor.
Limit per subject: A single individual investment limit per project is established for retail investors, which is set at the higher amount of 1.000 euros or 5% of wealth (does not include real estate properties and pension funds). There is no problem investing above these limits, but you will be warned of the risks.
Total limit: Previously, the maximum fundraising amount per project could not exceed 2.000.000 euros within a 12-month period.

With the entry into force of the aforementioned European Regulation and, therefore, of this Law, this limit is raised to 5.000.000 euros, knowing that investments for a higher amount will require the issuance of a specific prospectus, the requirements of which are regulated in accordance with the law. succinctly in Regulation 2017/1129, on the prospectus that must be published in the event of a public offer or admission to trading of securities on a regulated market

These types of platforms will be able to create and group investors in a limited liability company whose corporate purpose will be the holding of shares in the company in which they invest.

Collective investment and venture capital

On this point, a series of reforms are introduced that aim to promote and improve collective investment and venture capital in Spain, a sector that needs regulations that allow it to contribute even more to the entire economic activity and that allows it to protect the investor. especially to the individual.

By way of merely indicative and not exhaustive, we highlight:

The incorporation of a type of vehicle that comes from European legislation called “European long-term investment fund (ELTIF)” which is created to give retail investors access to investment in unlisted small and medium-sized companies, allowing them to invest in a type of asset (syndicated loans, private debt…) only available, until now, to institutional investors.

Recognition of the figure of the “debt funds”, which, in the context of economic recovery, can help alleviate the debt situation of companies and facilitate their growth and additional obligations and requirements are established so that they can be incorporated.

That is, the figures for closed funds are expanded, including structures with extensive experience in other neighboring countries.

Economic activities

The legal text deepens the cooperation and mutual trust between the different Public Administrations and reinforces the windows in which companies can complain when they consider that the Administrations do not comply with the principles of good economic regulation.

On the other hand, it expands the catalog of exempt economic activities license, contributing to reducing bureaucratization. This is incorporated into the state list of activities that have been considered harmless by at least one Autonomous Community.

To this end, numerous articles of the Law 20/2013, guarantee of market unity, as well as article 7 of the 29 / 1998, Regulator of the Contentious-Administrative Jurisdiction and article 8 of the 12 / 2012 of urgent measures to liberalize trade and certain services.

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In conclusion and awaiting its regulatory development, this Law aims to promote the creation of companies and facilitate their growth and expansion, considering it as an essential step for business growth and as one of the most important reforms of the Recovery, Transformation and Resilience Plan of the Executive, all with the aim of increasing productivity, the quality of employment and the internationalization of the Spanish economy.

Alberto Lopez Cazalilla, ELZABURU lawyer

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