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Avinyó 7, 1r
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A practical Guide to doing Business in the City
BARCELONA, A GOOD INVESTMENT
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A practical Guide to doing Business in the City
EDITION:
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Barcelona, a good investment : practical guide to doing business in the city
I. Borrell, Xavier, ed. II. Barcelona. Sector de Promoció Econòmica III. Centre d'Innovació i Desenvolupament Empresarial (Catalunya) 1. Inversions estrangeres _ Barcelona _ Manuals, guies, etc. 2. Barcelona _ Comerç _ Manuals, guies, etc. 3. Barcelona _ Condicions econòmiques _ Manuals, guies, etc.
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A practical Guide to doing Business in the City
BARCELONA, A GOOD INVESTMENT
4
B
arcelona is an open, tolerant and cosmopolitan Mediterranean city full of light; a remarkable urban space with a strong personality. The atmosphere transmitted by the city encourages creation and innovation, turning Barcelona into one of the European cities with the highest potential for developing new generation activities. In the current globalisation framework, it is precisely these characteristics which provide value to the city and differentiate it from the rest: it is this personality, both cosmopolitan with a great international vocation, and strongly rooted in its local aspects, which attracts our visitors and keeps them here.Faced by growing international competition, Barcelona and its surrounding area, with its population of 4.6 million, is one of the most important economic metropolises and has become consolidated as one of the main European capitals for business. A city which boosts its own personality and diversity and encourages talent and creativity; a laboratory where ideas are conceived and a significant creative community which attracts and receives the best companies and professionals is brought together. Its great international projection, privileged geographical situation and accessibility, added to the complex business network in its area, make it a very appealing location for business.
Barcelona is now reinventing itself, its eyes on the future, with an urban and economic transformation which will provide over 7 million square metres for new economic activity. The urban reform projects which are defining our future will enable us to improve access to the city, as well as its connections and communications, increase the offering and services available to businesses, and improve quality of life for all citizens. All urban projects currently in progress are increasing Barcelona's appeal and consolidating the city as the main urban centre in the west Mediterranean. The following are particularly noteworthy due to their size: the transformation of the Poblenou industrial district, the new 22@bcn technology district, the arrival of the new High Speed Train, the Delta Plan - with extensions to both the port and the airport - and the extension of the International Trade Fair (Fira Internacional), as well as the new conference centre with capacity for 15,000 delegates.
B
arcelona is moving towards the “laboratory city” model. This refers to a city where new ideas and concepts are emerging, a city which is competitive not in terms of production costs but in innovation and creativity, where pro-ducts are designed or improved, and where theatmosphere, diversity and range of uses promote the creation and trans-fer of knowledge. Barcelona, cutting-edge, dynamic and entrepreneurial, sets trends. With its long industrial tradition, the Barcelona area is a very important foreign investment attraction centre, especially for industry and advanced services. 25% of foreign investment in Spain is concentrated here, with 2,700 registered businesses, most of them in Barcelona city. There is a constantly growing number of forward-looking companies which choose to set up in Barcelona, and we are proud to observe that, once established among us, their expectations are fully met. And the international perception of Barcelona's potential as a new economy city is also growing in importance.
This has been shown by many international economic indicators, such as the recent Paris Chamber of Commerce study placing Barcelona's area of influence as the second most appealing region for foreign investment, second only to London; or the annual study conducted by British consultancy Cushman & Wakefield Healey & Baker placing Barcelona as the fifth best city for business in Europe and the top city in Europe in terms of progress.
But Barcelona isn't just a city for working; it's a city for living. With its stable climate, its openness to the sea, a magnificent selection of culture and leisure options, a broad network of education and research institutions at every level, a prestigious health service accessible to everyone, and a serious commitment to sustainability, Barcelona has the best quality of life in the whole of Europe. We are introducing the first edition of the Guide to Barcelona, a Good Investment, jointly prepared by the Economic Promotion Sector of Barcelona City Council and Centre for Innovation and Business Development (CIDEM) of the Catalan Government's (Generalitat de Catalunya) with the aim of offering useful and practical information to everyone wishing to invest and do business in Barcelona and become acquainted with its many charms.
We hope that this new guide will help make the decision to settle in Barcelona easier, as well as accelerate the process of establishing a new economic activity.
Jordi Portabella
Second Deputy Mayor of Barcelona
Joan Clos
5
spite of its small size, Catalonia has a great variety of cultural activities and venues. It also provides a first rate environment both for living and for business. This helps keep company staff satisfied and stable.
According to a study conducted by Cushman & Wakefield Healey & Baker, Barcelona is the best place for quality of life, a position it has maintained since 1996. Its quality of life and the perception of the Barcelona area as a creative and cosmopolitan environment are valued as strong points for attracting and retaining talent and knowledge. Proof of this is provided by the recent trend of international entrepreneurs choosing Barcelona for a new economic activity. In the intensive globalisation process undergone in recent decades by the international community, Catalonia has been able to establish itself as the ideal location for setting up large multinational companies. As a result of this investment process, Catalonia has become consolidated as one of the most dynamic regions in Europe in terms of attracting multinationals: there are currently 3,000 such companies in Catalonia (600 of which are industrial businesses). Conscious of the importance and positive effects of foreign direct investment (FDI), and making use of its exclusive powers in the industry context, the Generalitat has put into practice an active policy of encouraging business investment in Catalonia. We are also making a serious and clear commitment at the Generalitat to boost our companies' research, development and capacity for innovation. We want to place Catalonia in a top position in Europe.
C
atalonia is a privileged part of Europe for business activities. Countless multinationals from around the world, specialised in various sectors, have chosen Catalonia to conduct their business activities. Barcelona City Council and the Centre for Innovation and Business Development (CIDEM) have joined forces to create this publication which is intended as a basic and simple advice and guidance tool for anyone considering starting up a business in Barcelona. This guide is structured in outline, in order to give you a general idea of the steps to be taken into account when starting up a business. At the end of the guide, you will find the websites and useful addresses you can use to obtain more detailed information on each step. We have also included a list of the main incentives and subsidies available to businessmen and entrepreneurs.Catalonia attracts a lot of investment, particularly for industry and advanced services. This has been shown by the fact that already established companies often make a strategic commitment, carrying out new investments in order to make their subsidiaries evolve towards higher value added activities. The main reason for this is the high satisfaction level of companies already operating in Catalonia. Barcelona and its surrounding area, with its population of 4.3 million, constitutes one of the main economic metropolises in Europe, aiming to attract not just the best businesses but also the best professionals, who are the ones who will generate wealth and increase productivity. Catalonia's well-being and development are at European levels. In
Catalonia offers c o m p a n i e s making a commitment to our territory the perfect balance between a high
quality communications infrastructure, an excellent university and research network, highly qualified labour force, a wide range of suppliers and an enviable quality of life.
The Centre for Innovation and Business Development (CIDEM), an organisation belonging to the Generalitat's Ministry of Employment and Industry, provides professional and confidential support, ranging from planning to implementation, to all companies wishing to invest in Catalonia, through the Catalonian Investment Agency (ACI). It also provides ongoing help for future needs. The agency, which has its headquarters in Barcelona, a branch in Madrid, and foreign offices in New York and Tokyo, offers its help and advice services tailored to the needs of companies which are considering settling in Catalonia or expanding their existing business in this region. The Agency's mission is to boost financially and technologically sound productive business investments in Catalonia, creating wealth and high quality, stable jobs. We must direct all our efforts to attracting new projects, in the form of productive, strategic and innovative investments, to our territory.
We look forward to welcoming you to Catalonia.
Jordi Carbonell i Sebarroja
Secretary of Industry
1
ECONOMIC PRESENTATION:
1.1
I
Ten Reasons to Invest in Barcelona
09
1.2
I
Main Economic Indicators
10
1.3
I
Location and the Property Market
17
1.4
I
Trade Fairs and Conferences
22
2
HOW TO START A BUSINESS IN BARCELONA:
2.1
I
Types of Business Organisation
25
2.2
I
Steps For Starting Up a Business
27
2.3
I
Tax Regime, Tax and Allowances
29
2.4
I
Work and Residence Permits
32
2.5
I
Employment Regime
35
2.6
I
Incentives and Subsidies and Financing
39
3
USEFUL ADDRESSES:
3.1
I
By Topic
43
3.2
I
In Alphabetical Order
44
CONTENTS
A practical Guide to doing Business in the City
1. ECONOMIC PRESENT
A
1.1
TEN REASONS TO INVEST
IN BARCELONA
Barcelona offers very diverse elements which make it a really appealing place to live, work and do business. The city is now a very interesting place for new economic activity, as shown by some of the good reasons to invest in it.
1
. Strategic geographic location
Two hours by road from France and one day from the main European cities. A southern door to Europe, with its own port, airport, Zona Franca, logistics parks, international trade fair centre and the city within a radius of 5 kilometres.
2
. Complete transport
infrastructure
A motorway network connected to Europe; the fastest-growing airport in Europe; Spain's leading port and the lar-gest container port in the Mediterranean; an extensive underground and overland train and bus network; High Speed Trains planned for 2007 and a connec-tion with the European network in 2009.
3
. The centre of a large, dynamic
and diverse economic area
4.6 million people live in the Barcelona area. It is the capital of Catalonia, with a population of 7 million, and the centre of the Mediterranean Basin, a large economic area with 18 million inhabitants. It accounts for 70% of Catalonia's GDP. Its growth in 2004 was 3.1% of GDP, above the Spanish and European average, and it is the sixth largest urban agglomeration, as well as the fifth largest industrial concentration, in Europe.
4
. Successful foreign
investment
It is the fifth best city for business in Europe and accounts for 20% of annual foreign investment in Spain. There are 2,700 foreign companies established here, with a satisfaction level of 97%. Barcelona is also becoming consolidated as a centre for multinational companies' European divisions.
5
. An internationally
acknowledged location
Barcelona has some of the highest positions in several international rankings, which rate its urban reality, its ability to attract foreign capital, its entrepreneurial nature and the quality of life enjoyed here very highly.
6
. Human resources prepared
for the future
A great responsibility ethic, high productivity (one of the highest in Europe, according to the OECD), five public universities, two private universities and four business schools (ESADE, IESE, EADA and IESKA), 27 international schools, great new technology penetration, and a favourable disposition towards innovation and creativity.
7
. Excellent quality of life
The top European city for quality of life. A stable climate, sunshine, beaches, ski, a generous range of culture and leisure activities, a network of 4,500 education institutions, a modern and accessible health service, easy access and travel by
public transport. The city is surrounded by nature reserves.
8
. Large progressive city
planning projects
The largest city planning and infrastructure transformation. Llobregat Area: a commitment to logistics and internationalisation, with the port and airport extensions. Besòs Area: urban renewal, sustainability and research centres. La Sagrera-Sant Andreu: the arrival of high speed trains. Poblenou 22@: the new technology and innovation district. Two new districts: La Marina and El Besòs, with a combination of residential premises and economic activity.
9
. A Competitive set of available
properties
A large number of offices, commercial premises and industrial buildings with excellent value for money. The construction of residential buildings is also on the rise.
10
. Unique private-public
cooperation
Barcelona City Council and the Catalan Government have made a serious commitment to business. The success of the traditional private-public cooperation has been key to Barcelona's transformation.
In the following pages, you will find more detailed information on Barcelona's economic reality.
Paris
Rome Milan Frankfurt
Berlin Dublin
Oslo
Copenhagen
Brussels Amsterdam
Vienna Prague
Geneva
Stockholm
Barcelona London
1. ECONOMIC PRESENT
A
TION
1.2.1 BASIC INFORMATION
ABOUT THE CITY
Location
Barcelona is one of the largest cities in Europe. It is the centre of a large metropolitan area of over 217 municipalities with 4.6 million inhabitants. It is the economic, cultural and administrative capital of Catalonia, which is located in northeast Spain on the Mediterranean shore.
It is at the forefront of a 17-million-inhabitant emerging area of economic
activity in southern Europe, a Mediterranean arch including the Balearic Islands, the Autonomous Regions of Valencia and Aragon, and southeast France.
Barcelona metropolitan area is the sixth largest urban agglomeration, as well as the fifth largest industrial concentration, in Europe.
Demographically, the city of Barcelona is constantly growing richer and more diverse; with 160 nationalities in 2004.
Barcelona currently has over 230,000 foreign residents. This is 14.6% of the
1.2
MAIN ECONOMIC
INDICATORS
AREA AND POPULATION (2005)
Population Area (km2) Density (inhabitants/km2)
Barcelona 1.578.546 101 15.671
Metropolitan area 4.673.648 3.236 1.427
Catalonia 6.813.319 31.895 210
Spain 43.197.684 505.988 84
Source: Barcelona City Council and the Spanish National Institute of Statistics (INE)
Source: Barcelona City Council
EVOLUTION OF FOREIGN POPULATION
January 2005 % of the total foreign population
Europe 52.835 22,9
Asia 36.810 15,9
Africa 20.818 9
America 120.197 52,1
Australasia 282 0,1
Total number of foreigners 230.942 100 in Barcelona
city's population, a very close percentage to other European cities such as Madrid, Copenhaguen and Hamburg among others, and higher than the Spanish average of 8.4%. The immigration of the last ten years has brought to the city of Barcelona a very significant increase in the number of languages spoken in it. The current language situation is 223 languages from 190 countries, a level of diversity which promotes an increasingly open and tolerant metropolis.
11
Historically, Catalonian economy has been one of Spain’s main economic drivers and is still the autonomous region with the highest Gross Domestic Product (GDP) in absolute terms. In recent years, it has followed a trajectory of expansion, and short term growth forecasts are positive.
1.2.2 A DIVERSIFIED
ECONOMIC
STRUCTURE
Activity by sector
The city’s wealth and development have traditionally been based on trade and manufacture. At the moment, the economic activity’s structure is characterised by the dominance of the services sector and the maintenance of a significant industrial base in the whole of the metropolitan area.
In parallel to the process of moving a large portion of the industrial sector to the metropolitan conurbation, the industry remaining in the central area has strengthened its conversion to high value added industry. It is formed by new economic activities of an industrial nature with branches such as environmental services, culture industries, the media, air transport and others with great growth potential. Specifically, in the 2000-2004 period, the amount of medium and high-tech industry in Barcelona and its metropolitan area increased by up to 11.2% and 35.8% respectively. In the services sector, especially in tourism-related services, high value added occupancy has increased by over 33%.
Business structure
Barcelona has a large business network very similar in structure to the European one. There are over 417,000 small and
medium-sized companies (SME, known in Catalan by the abbreviation PIME), representing 99.7% of all companies.
Employment
Recent years have shown a very positive picture of Barcelona’s job market. Both activity and employment rates grew, boosted by demographic growth and good economic and business prospects, and the job market picked up with an increase in the number of employed workers registered with the Social Security system. Specifically, 25,000 new jobs were created in Barcelona in 2003 and 2004, of which 39% were in high value added sectorst.
The gradual incorporation of legal immigrants in recent years and the increase in female employment and activity rates, following the growing tertiarisation of the production network of the city and its metropolitan area have been two very significant factors in the boost of this expansion trend.
Barcelona's tertiary sector is growing in a clearly entrepreneurial manner, as shown by the fact that the strongest increase in the last three years has been in the number of registered self-employed, especially in the new technologies sector.
The unemployment rate in 2004 was 6.2%, noticeably lower than that of Catalonia, Spain and the European Union.
1.2.3 FOREIGN INVESTMENT
IN BARCELONA
The Barcelona area is a very important foreign investment attraction centre, especially for industry and advanced services. This can be seen in many international economic indicators, such as the annual study conducted by British
Sources: Spanish National Institute (INE), Institut d'Estadística de Catalunya (IDESCAT), Eurostat
GDP
GDP at market prices
and inter-annual variation rate EU 25 EU 15 SPAIN CATALONIA
(2000 base index)
GDP (2004) (in millions of euros) 10.218.488 9.743.054 837.557 157.124 Annual growth rate in real terms. 2,4 2,3 3,1 3,1
STRUCTURE OF THE AFFILIATION TO THE SOCIAL SECURITY GENERAL SYSTEM ACCORDING TO BIG SECTORS (% /TOTAL) . 4THQUARTER 2004.
Barcelona Catalonia Spain
Agriculture 0,2 0,4 0,5
Industry 13,0 22,6 18,0
Construction 5,2 9,2 11,9
Services 81,6 67,8 69,6
TOTAL 100,0 100,0 100,0
GDP per capita (2004)
1. ECONOMIC PRESENT
A
TION
consultancy firm Cushman & Wakefield Healey & Baker, which, for the first time in its 2005 edition, named Barcelona as the fifth best city in Europe for business, thus raising it one position.
Already established companies very often make a strategic commitment through new investments in order to make their subsidiaries evolve towards higher value added activities. The main reason for this is the high satisfaction level (97%) of companies already operating in the Barcelona area.
70% of all Japanese companies and 50% of all German, French and North American companies in Spain are in Barcelona’s economic area. Over 50% of foreign companies of an industrial nature in Barcelona’s economic area belong to the chemical, pharmaceutical and car industries. The services sector accounts for 42%, and construction for another 3%.
The Barcelona area is still a destination of reference for attracting highly specialised services such as administrative, financial
and marketing services centres. These centres are at the forefront of the current process being undergone by companies to become network structures with independent units in different territories.
Trends
Barcelona is at the receiving end of a growing flow of investment aimed at creating management and services centres, research and distribution centres, software development centres and design centres in the most varied sectors, such as professional and consumer electronics and the car industry.
These are some of the sectors, activities and forward-looking uses the city wants to boost. This is why Barcelona has decided to promote the establishment, in the city, of financial activities and businesses of large multinationals related to design, knowledge, distribution and customer call centres, also known by the English names Call Centers or Customer Relationship Management.
12
Number of Foreign Companies in 2004
Barcelona 1.340
Metropolitan area 2.698
Catalonia 2.915
Source: Foreign Investment in the Barcelona Area (La inversió estrangera a l'àrea de Barcelona). Barcelona: Barcelona City Council, CIDEM, 2004.
Foreign Investment in Catalonia (1994-2004) 30.022.220.000 €
Percentage in relation to the total for Spain: 15,57%
Foreign Investment in Catalonia (1st half of 2005)
Growth rate in 2005/2004. 25%
Percentage in relation to the total for Spain: 44,3% Source: Foreign Investment in the Barcelona Area (La inversió estrangera a l'àrea de Barcelona). Barcelona: Barcelona City Council, CIDEM, 2004.
13
1.2.4 AN INTERNATIONALLY
RECOGNISED LOCATION
BARCELONA, TOP 10
The European city which best promoted itself at an international level to attract Cushman & Wakefield Healey & Baker. foreign investment in 2005.
The fifth best city in Europe for investing and doing business in 2005. Cushman & Wakefield Healey & Baker. The city with the best quality of life in Europe in 2005. Cushman & Wakefield Healey & Baker. Barcelona, the second most attractive European area for foreign investment in 2004. Chambre de Commerce de Paris. Best European city for investing in 2004. FDI, Foreign Direct Investment.
(Group Finantial Times)
The European city which has advanced most in recent years (2005). Cushman & Wakefield Healey & Baker. The European city of the future in 2004. FDI, Foreign Direct Investment.
(Group Finantial Times) Best European city for transport in 2004. FDI, Foreign Direct Investment.
(Group Finantial Times) One of the cities with the best growth prospects in Europe in 2002-2006. ERECO European Economic
Research Consortium. One of the cities with the most competitive cost of living in 2004. UBS
Barcelona has some of the highest positions in the various international rankings, which rate its urban reality, its ability to attract foreign capital, its
entrepreneurial nature for business and the quality of life enjoyed here very highly. 1 2 3 4 5 6 7 8 9 10
INTERNATIONAL COMPARISONS 2005
Cushman & Wakefield Healey & Baker
Font: Cushman
& Wakefield Healey & Baker
1. ECONOMIC PRESENT
A
TION
1.2.5 FIRST CLASS
INTERNATIONAL
EDUCATION AND
ACADEMIA
Thanks to its significant education tradition, Barcelona is very well equipped to continually improve quality in this area. The network of education centres now offers a very comprehensive selection of study possibilities to provide an easy solution to different situations and education needs.
Universities and higher education
The city has eight universities and several business schools of international renown. In addition, there are eleven technology transfer centres linked to the universities which have received several awards for their innovative initiatives from the European Commission’s Directorate-General for Enterprise and the Information Society.
Barcelona has consolidated itself as a first class university destination in terms of number of universities, qualifications and students.
International schools
There are several foreign schools in the city and its surroundings, enabling anyone wishing to do so to pursue foreign curriculums in the city. There are 27 such schools in total, providing teaching in five languages: English, French, German, Italian and Japanese.
www.cidem.com/catalonia/cat/com/adreces/escoles/index.jsp
1.2.6 QUALITY OF LIFE: A
CITY TO VISIT AND
LIVE IN
Barcelona is a dynamic, modern and diverse city, whose profound entrepreneurial, commercial and competitive spirit has for centuries coexisted with the art of good living and the enjoyment of the expressiveness of a demanding culture and urban quality. Its Mediterranean climate, the culture and leisure options on offer and the quality of life are key to attracting tourists and businesspeople to Barcelona. The city, located between the sea and the mountains, enjoys temperatures of between 23º C in the summer and 9º C in the winter, and has 7 km of well maintained beaches in the city centre itself.
In addition, Barcelona has a highly valued cultural offer: 46 theatres, 41 museums, 46 libraries, over 200 cinema screens and countless concerts and festivals held throughout the year. It is a great city which brings to daily life the inheritance of its architectural and monumental heritage. It is the only city in the world with eight World Heritage sites. The city, so full of great examples of Modernista architecture and works by Gaudí, has been asserting its open and progressive nature from the late 20th century, with a new urban architecture which has reached clear international projection.
All this, added to first class public and private services (education, health, etc.), a high environmental commitment from businesses, respect for quality and occupational risk prevention, and a
14
Name of the Organisation Type Web
Barcelona University (UB) Public www.ub.edu
Barcelona Autonomous University (UAB) Public www.uab.es Catalonia Polytechnic University (UPC) Public www.upc.edu Pompeu Fabra University (UPF) Public www.upf.edu Ramon Llull University Private www.url.edu Abat Oliba – CEU University Private www.uao.es Catalonia International University (UIC) Private www.uic.es Catalonia Open University (UOC) Private www.uoc.edu
IESE Business school www.iese.edu
ESADE Business school www.esade.edu
EADA Business school www.eada.edu
IESKA Business school www.ieska.com
UNIVERSITY DATA FOR ACADEMIC YEAR 2003-2004
First and second stage internal and approved university diplomas. 393 qualifications
University students. 204.000
Foreign students. 11.221
15
District 22@
A project to transform the industrial district of Poblenou into an innovative production district, in the heart of the city, offering modern spaces for strategic concentration of intensive knowledge activities. This initiative is both an urban renewal project and a new city model in answer to the challenges of the Knowledge Society.
Scope: 200 hectares.
3.200.000 square metres of production spaces. 220.000 square metres for new facilities and green areas.
4.000 new subsidised flats and houses. An estimated 130,000 new jobs.
An economic potential of €12,000 million for the whole operation.
+ www.bcn.es/22@bcn
Besòs Inter-University Campus
This relates to the creation of an inter-university campus for teaching and
research, linked to the new production and business activity. It is in the new Avenida Diagonal extension area, on the coastline and the right bank of the River Besòs. This campus, which is promoted by the Barcelona 22@ innovation and the large transformation being undertaken in the Besòs area, will help polish and modernise the current urban grid.
160.000 square metres devoted to a new approach to knowledge spaces.
Barcelona Biomedical Research
Park
This initiative is promoted by the Catalonian Government (Generalitat de Catalunya), Barcelona City Council and Pompeu Fabra University, and aims to place Barcelona at the forefront of European transnational biomedical research. It is a science project involving both basic and applied research, in a 50,000 square metre space, able to public transport system combining
quality and price, make Barcelona a very appealing city both for living in and for doing business.
International comparisons
Barcelona’s international renown for the quality of its city life and the gradual internationalisation it has achieved has been consolidated in recent years. This is so to the point that it was chosen European city with the best quality of life for the seventh consecutive year in the 2005 European ranking published by Cushman & Wakefield Healey & Baker (C&W H&B).
On the other hand, Mercer Consulting’s ranking of the most expensive cities in the world placed Barcelona in 56th place, and the Union de Banques Suisses (UBS) placed it in 27th place in its study taking into account citizens’ income level on the basis of salaries. In summary, Barcelona is in a place of preference in terms of economic activity and business attraction, while consolidating itself as a fantastic European tourist destination offering both visitors and residents modern and inclusive city planning with a high quality of life.
1.2.7 NEW CITY PLANNING
PROJECTS
provide answers with perspectives ranging from molecular to population levels.
50.000 square metres. 80 research groups.
1.000 professionals, scientists and highly qualified technicians.
+ www.prbb.org
Airport extension
The airport extension project is coordinated through the Airport Master Plan, which provides for the regulation of activities in the airport premises and the completion of the new passenger and cargo terminals and of the whole airport in general.
The aim is to turn Barcelona El Prat airport into an international connection airport which will be able to meet the growing demands forecast between now and the 2025 horizon. The main actions envisaged by the Plan by 2007 are: renovation and refurbishing of the current terminal area, building the third runway and extending the existing one, the new South terminal, road and rail access, the services area (air cargo centre and aeronautical park), and environmental action.
1. ECONOMIC PRESENT
A
TION
16
40 million passengers per year.
90 operators at the busiest times and 400,000 operations per year.
500.000 tonnes of goods per year. 250-hectare services area. + www.aena.es
Port extension
Work on the extension of Barcelona port began in late 2001 with the placing of the first stone of the east pier. When this is completed, the port’s area and infrastructures will have doubled, enabling it to double its goods traffic too. One of the port's main appeals will be multi-access, thanks to the new road and rail access, the arrival of the European track width and the close proximity of the airport. This extension, which will be completed in 2010, will make it possible for the port to become the main logistics centre in Southern Europe.
1.265 hectares of land surface area (currently 558 hectares).
786 hectares of sea area (currently 374 hectares).
265 hectares of logistics areas (currently 65 hectares).
+ www.apb.es
Sagrera-Sant Andreu plan
This is a city planning transformation project covering a large area of Barcelona. It includes regulating the railway infrastructures in the north of the city, building the new La Sagrera High Speed Train central station and carrying out city planning improvements on five districts around the new rail complex, which will involve covering the tracks and creating a large linear park of over 4 kilometres in length connecting the districts of Sant Andreu-La Sagrera to Sant Martí. The details of the plan are:
Total area: 163 hectares (98 hectares of offices and housing; 53 hectares of green areas, and 12 hectares of facilities). Construction of 8,000 new dwellings, offices and commercial premises..
+www.bcn.es/urbanisme/tav
1.3.1 OFFICES AND
COMMERCIAL
PREMISES
Barcelona’s business spaces – over 12 million square metres of industrial areas and around 4,500,000 square metres of total office floor space – enable business activities to grow and develop with excellent value for money, especially with regard to offices.
1.3
LOCATION AND
THE PROPERTY MARKET
BASIC INFORMATION RELATING TO OFFICES
m2
Office space 4.906.634
Contracted surface area 413.000
Available space 295.000
Non-occupancy rate 6 %
Minimum and maximum rent prices (€/m2/month). 8,5 / 23,5
Traditional central area
Barcelona city. Avenida Diagonal and Passeig de Gràcia.
Traditional business district
Barcelona city. City centre and central Eixample area.
Traditional secondary central zone
Barcelona city. Left and right Eixample, boundary areas.
New central districts
Barcelona area.
Gran Via l’Hospitalet, Diagonal Mar, 22@, Olympic Village and Port.
Inner periphery
Barcelona area. Zona Franca, Mas Blau, Sant Cugat Business Park, Cornellà, Cerdanyola and Viladecans.
OFFICE MARKET ZONING IN THE BARCELONA AREA
Source: Jones Lang Lasalle. 2005
17
Vallès Occ. Sant Cugat
Sant Just Desvern Sant Joan Despí
Cornellà
Mas Blau
1. ECONOMIC PRESENT
A
TION
18
Commercial premises
Commerce has always played a very important role in Barcelona’s history. The commercial sector is one of the activities which best reflect the open mentality of Barcelona’s inhabitants and the city’s good economic development. In addition, Barcelona has inherited a track record as a successful Mediterranean trading city.
In 2004, commercial sector turnover rose to €32,664 million, 6.2% higher than the previous year. This figure represents 15% of the city’s GDP and over 163,000 jobs. Barcelona has 17 open air shopping districts spread out throughout the city. They are city areas with high concentrations of shops. They are generally shopping areas with a different offering from the city centre.
1.3.2 INDUSTRIAL LAND
AND BUILDINGS
Barcelona is one of the cities with the most real property available for industrial activities in the Mediterranean Basin: over 12 million square metres. In spite of the limits on increasing this availability with new industrial land, the metropolitan area offers new opportunities around the main road arteries. The general trend indicates that the industrial land closest to Barcelona city centre is gradually being converted to mixed office, warehouse and residential premises
A-1 A-2
A-3 B-2 B-3
B-1 C-1 C-2
C-3 B-5
B-4
C-4 D-1
D-2
D-1 E-1
E-1
E-1
E-1
E-1 E-1
BASIC INFORMATION RELATING TO COMMERCE
Number of commercial establishments 53.668
• Wholesale (26,6%) 14.280
• Retail (73,4%) 39.388
Non-occupancy rate 7,8%
Average rent prices (€/m2/year) 600
Total average sale price (€/m2) 2.000
Source: Developed in-house based on data provided by Global Property Alliance, King Sturge and Barcelona City Council
AVERAGE PRICES FOR INDUSTRIAL BUILDINGS AND PREMISES
Industrial building rent price (€/m2/month) 7,1
Industrial building sale price (€/m2) 1.175
Industrial land total sale price (€/m2) 707,5 Source: Forcadell and King Sturge.
Zona A
Barcelonès, Baix llobregat
Zona B
Vallès Oriental and others
Zona C
Vallès Occidental and others
Zona D
Maresme and others
SHOPPING STREETS AND DISTRICTS IN BARCELONA
ZONING OF BARCELONA'S INDUSTRIAL OFFERING
Zona E
19
RENT Offices €/m2/year Commercial spaces €/m2/year Industry €/m2/month
Amsterdam 345 1.600 65
Athens 320 3700 85
Barcelona 260 600 80
Beijing 175 1.349 125
Berlin 288 2.280 72
Birmingham 418 4.732 91
Brussels 280 1.300 68
Buenos Aires 90 190 35
Chicago 270 1.321 104
Dublin 516 6.000 120
Hong Kong 461 3.664 45
London 908 7.882 190
Madrid 280 720 85
Manchester 396 5.047 84
Miami 265 209 74
New York 435 2.573 106
Paris 670 8.000 61
San Francisco 240 739 104
Shanghai 315 1.125 45
Taipei 172 1.059 136
Tokyo 720 575 138
Washington 370 530 116
Source: Global Aliance Property
RENT COMPARISON.
1. ECONOMIC PRESENT
A
TION
20
2004 saw an upturn in the number of dwellings in the market. The number of dwellings available in Barcelona increased by 10.1%. Residential construction has focused on the outskirts, which have more land available, mostly free from other uses. All this new residential construction has increased its sale price by around 20.6%. The rental market, on the other hand, has experienced a more moderate growth: around 7.6%.
HOUSING BY DISTRICT
Reference prices (2005) SALE RENT
Districts Newly built €/m2 Second hand €/m2 Average €/m2
Ciutat Vella 4.200 3.900 10,4
L'Eixample 5.276 4.139 10,56
Sants 3.827 3.573 11,24
Les Corts 4.393 4.402 12,93
Sarrià - Sant Gervasi 7.856 4.906 12,9
Gràcia 4.335 4.006 11,21
Horta - Guinardó 3.430 3.359 9,93
Nou Barris 3.350 3.121 9,75
Sant Andreu 3.581 3.364 9,65
Sant Martí 3.636 3.700 11.15
Average for Barcelona 4.493 3.813 10,91
Source: Municipal Housing Trust (Patronat Municipal de l'Habitatge)
1.3.3 AVAILABLE RESIDENTIAL PROPERTY
Sants - Montjuïc Les Corts
Sarrià - Sant Gervasi
Gràcia
L’Eixample
Ciutat Vella
Horta - Guinardó
Sant Martí
Nou Barris
21
1.3.4 LOCATION
Barcelona City Council, through the Economic Promotion Sector (Sector de Promoció Econòmica), and the Centre for Innovation and Business Development (CIDEM), provide help and advice to find spaces for economic activities. There are also various companies, institutions, guidebooks and websites to help you find different types of property (offices, commercial premises, industrial land and buildings and residential properties). Later is a list of some of the main ones.
Name / type Description Web address
International property The main international estate agents
consultants. operating in Barcelona offer a wide
*
range of locationsand services.
Company 22@bcn. State-owned organisation which www.bcn.es/22@bcn manages the conversion of the
district of Poblenou into a technology district. It provides information on commercial premises and offices in the area.
Pacte Industrial de A BCN metropolitan area organisation www.pacteind.org la Regió Metropolitana. providing information on in dustrial
buildings & commercial premises.
Cimalsa. Integrated Centre for Logistics Activiti- www.cimalsa.es es and Goods), a State-owned
organi-sation which promotes infrastructures and facilities relating to logistics and transports
Col·legi d'APIS. Official Estate Agents’ Association for www.apibcn.com Barcelona city and province.
Col·legi d'Administradors Professional Association of Property www.coleadministradors.com Administrators for Barcelona and
Lleida.
Business centres. Barcelona and its surrounding area
*
have a wide range of business centres with all kinds of spaces and services for businesses
Business incubators. Aimed at entrepreneurs with a viable www.barcelonactiva.es business project who wish to start a
company and set up in the city.
Relocation companies Companies which offer all kinds of
*
services to help foreigners settle into the city.
Real estate guidebooks Offices and commercial and residential
*
and portals premises are also marketed by means of classified advertisements in papers, property supplements in news-papers and magazines, specific adver-tising by estate agents, and also through real estate portals on the Internet
1. ECONOMIC PRESENT
A
TION
22
1.4.1 BARCELONA TRADE
FAIR (FIRA DE
BARCELONA)
Most of the trade fair and conference activities held in the city take place at Fira de Barcelona, which is one of the drivers of the city’s commercial activity. Since its creation almost one hundred years ago, this is the leading such centre in the whole of Spain and one of the top five in Europe in terms of number of events held.
Every year, Fira de Barcelona welcomes over 30,000 exhibiting companies and 3.5 million visitors. In 2004, trade
fair-related activities generated 2,000 million euros of induced economy. Some of the more than 70 shows organised by Fira de Barcelona are in the top places of the European trade fair ranking: Alimentaria (food and drink sector), Sonimagphoto (audio and photography), Saló de l'Automòbil (cars), Hispack (packaging), Graphispag (graphics), Caravaning (caravans), and Saló Nàutic (boats).
Fira de Barcelona is formed by two large centres: Montjuïc-1 and Montjuïc-2. When the current extension is finished, the centre will cover an area of 355,000 square metres, making it the second largest in Europe
1.4.2 CONFERENCES,
CONVENTIONS AND
PROFESSIONAL
MEETINGS
According to data from the International Union of Associations, Barcelona is in seventh place in the world in the conference and convention tourism market. The attached table contains some data showing the active economy in this area. From the spaces available for organising conferences and conventions in the city, it highlights the Fira de Barcelona facilities (Palau de Congressos and Centre de Convencions - the Conference and Convention Centres), the new Barcelona International Convention Centre (CCIB) and the Palau de Congressos de Catalunya (Catalonia Convention Centre). In addition, the Barcelona Convention Bureau provides all kinds of information and advice for the organisation of conferences, meetings and incentive trips.
TRADE FAIRS AND
CONFERENCES
CONFERENCES AND PROFESSIONAL MEETINGS (2004)
Number of meetings Number of participants
Conferences, seminars and courses 374 Conferences, seminars and courses 193.708 Conventions and incentives 772 Conventions and incentives 166.627
Total 1146 Total 360.335
Source: Barcelona Tourism Board, 2004.
23 FIRA DE BARCELONA CONFERENCE AND
CONVENTION CENTRES.
(PALAU DE CONGRESSOS AND CENTRE DE CONVENCIONS DE BARCELONA).
Fira de Barcelona is also a leader in the organisation of industrial and professional conferences, events and conventions. It is one of the sector’s top four institutions in Europe in terms of number of events. It includes the Conference Centre (Palau de Congressos), located in the Montjuïc-1 premises, and a convention centre in the Montjuïc-2 premises.
+ Information / Infofira
Tel. 902 233 200 | +34 93 233 20 00 www.firabcn.es
BARCELONA INTERNATIONAL CONVENTION CENTRE (CCIB)
CCIB was built for the 2004 Universal Forum of Cultures. It is now the largest convention centre in southern Europe and its construction has greatly advanced Barcelona’s position in the conference and convention tourism sector, since the city can now meet demand for events of over 6,000 delegates and can hold 15,000 people in a single place.
+ Information Tel. +34 93 230 10 00 ccib@ccib.es www.ccib.es
CATALONIA CONVENTION CENTRE (PALAU DE CONGRESSOS DE CATALUNYA)
It was built in 2001 and is part of the Royal Complex, a deluxe complex created by the Conference Centre itself, the hotel Juan Carlos I, The Royal Fitness and The Royal Catering, with the aim of offering top level services tailored to each client’s needs.
+ Information Tel. +34 93 364 44 00 info@pcongressos.com www.pcongresos.com
BARCELONA CONVENTION BUREAU (BCB)
BCB is a Barcelona Tourism Board programme specialising in providing support for the organisation of events and the promotion of the city as a venue for meetings.
2. HOW TO ST
25 THERE ARE TWO BASIC WAYS OF
CARRYING OUT A BUSINESS ACTIVITY IN CATALONIA:
On a employed basis, i.e. as a self-employed with unlimited liability (including both business and personal assets) or by creating a company, with liability limited to business assets. Choosing the appropriate type of business organisation for the activity depends on the investor’s interests and strategy. Under the current legal framework, there is a broad range of possibilities with flexibility to adapt to the particular needs of each investor.
2.1.1 SELF-EMPLOYED
This is the perfect way for a natural person to carry out a business activity in his or her own name on a regular basis. The only legal requirements are that the
person who is to carry out the business activity must be of full legal age (18 or over) and have sufficient legal capacity to carry it out.
The steps for starting up a business as a self-employed are easier and cheaper than those for starting a company, but self-employed people are liable for the business’ debts with their current and future personal assets.
When a place of business is set up, its name will be that of the person who owns the business (although he or she may work under a different trade name). Self-employed are governed by a special Social Security regime called RETA (Special Regime for Self-employed Workers) with its own rules distinct from the regime governing employed workers. Any workers hired by the self-employed must register with the general Social Security regime.
A self-employed or self-employed worker
is one who conducts, on a personal,
direct and regular basis, an economic
activity for profit without being subject to
an employment contract.
If a foreigner wishes to carry out an activity on a self-employed basis, he or she must have the legal capacity to conduct a business activity under the national law of his or her country of origin, and must obtain authorisation (the relevant work and residence permit) from the relevant Government office.
2.1.2 COMPANIES
This can be considered the most common type of investment. There are several types of company under Spanish law. The main ones are the Public Limited Company (Societat Anònima, SA) and the Private Limited Company (Societat de Responsabilitat Limitada, SL), which are characterised by the limitation of investors’ liability to their contribution to the company.
2.1
TYPES OF BUSINESS
2. HOW TO ST
ART A BUSINESS IN BARCELONA
26
The Public Limited Company (SA)form is advisable for large businesses and/or projects, both commercial and industrial, and requires a substantial capital investment, which can be obtained by offering shares to the public.
However, many medium-sized companies also choose this form of business organisation because of the ease with which shares can be transferred. It is worth noting that there are some sectors in which the investment must be mandatorily made through a Public Limited Company: these include the banking, insurance and television sectors, among others. The Private Limited Company (SL)is the form usually adopted by small and medium-sized companies, because of the lower minimum share capital required. In any case, their high degree of flexibility in terms of management and organisation also makes them appealing for setting up large businesses for which these factors are relevant, such as
business partnerships or portfolio companies.
However, if the entrepreneur is a foreign legal person, it is quite common to set up an entity without its own legal personality,
such as a Branch or Representative Office.
Other structures may be interesting for the establishment of specific projects, such as Private Partnerships (Societats Civils Privades), Economic Interest Groups
(Agrupacions d’Interès Econòmic) and
Cooperatives (Societats cooperatives), although their use is less widespread because the investors’ liability is unlimited.
On the other hand, their great operational flexibility and some particularities of tax regimes which apply to them can make them advantageous for certain projects. Another business form is the New Firm Private Limited Company (Societat Limitada de Nova Empresa), a new sub-type of Private Limited Company which is
much quicker and easier to incorporate (24 h), through standard forms and electronic media. It also has simpler accounting obligations and a high degree of flexibility. It is intended for small business and individual entrepreneurs. Below is a table summarising the most common types of business organisation:
The steps required for starting up a
SUMMARY OF THE MAIN FORMS OF BUSINESS ORGANISATION IN BARCELONA
Self-employed Private Limited Public Limited Branches Representative
Companies Companies Offices
Divided capital. None. Stock units. Own shares. No capital No capital of its own. of its own. Minimum capital. Enough to carry out 3.005,06 €, 60.101,21 €, at least Assigned endowment. Own resources from
the activity. paid up on 25% of the minimum the parent. It is incorporation. capital must be paid up not considered foreign
on incorporation. investment.
Public steps. Not required. Public deed Public deed Public deed Escriptura pública Commercial Register. Commercial Register. Commercial Register. Registre Mercantil. Legal personality. None. The company’s. The company’s. The foreign parent’s. The foreign parent’s.
27
business depend on the type of business organisation the investor wishes to use. Deadlines will vary depending on the type of business organisation chosen. Below is a summary of the procedures for each of the business organisation types most commonly used in Catalonia.
It is worth noting that, foreign
self-employed, in addition to the tramits mentioned in section 2.2.1, must first obtain the work and residence permit mentioned in section 2.1.1 and 2.4. In
some cases, and depending on the activity to be carried out, the permit may only be obtained after their qualification has been officially approved.
In case of foreign associate(S.A/S.L), in
addition to the tramits mentioned in section 2.2.2 , must obtain:
- Foreigners' Identification Code
(Número d’Identificació d’Estrangers NIE) in any Government office or the Spanish Consulate or Embassy. - Declaration or authorisation of the
2.2.1 STEPS FOR SETTING UP AS A
SELF-EMPLOYED
Steps
1. Census declaration confirming that the provisional Tax Identification Code (CIF) has been obtained.
Registration for the following taxes: Value Added Tax (VAT) and Business Tax (Impost sobre Activitats Econòmiques, IAE).
2. Obtaining the required licences, autho-risations and administrative registrations. 3. Registration with the Special Regime for Self-employed Workers (RETA).
4. Registering the business with the Social Security system for registering workers.
5. Notice of opening of the business premises.
6. Legalisation of the records.
The total time period is
approximately one week. (apart from any necessary administrative authorisations).
Description
Submittal of official form 036 to obtain the provi-sional Tax Identification Code, which is also the self-employed personal Tax Identification Number (NIF). This step identifies the business activity for tax purposes and notifies the administration of the starting of the activity.
With regard to Business Tax, self-employed are exempt from paying this tax but must provide census information by means of the related return These vary depending on the type of business activity.
Compulsory registration with the Special Regime for Self-employed Workers for self-employed acting as individual entrepreneurs, TA-1 card form. Compulsory registration of the business with the Social Security system in order to register workers, TA-1 card form for the first registration, and TA-2 card form with details of the business and the workers.
Obligation to notify of the opening of the premises in which the activity will be carried out.
These are the employment record register, and the tax and accounts books (Journal, Inventory Book and Annual Accounts).
Institution / Organisation
Any branch of the State Tax Administration Agency (Agència Estatal de l'Administració Tributària) for that address.
Deadline: before starting the activity
Public administrations: regional and local. Deadline: before commencing the activity Provincial Social Security Treasury. Deadline: within 30 days following the commencement of the activity. Provincial Social Security Treasury. Deadline for registration: within 30 days following the commencement of the activity. Deadline for registering workers: between 1 and 60 days before the commencement of the activity
Provincial branch of the Ministry of Employment Regional Service.
Deadline: 30 days following the opening of the premises.
Labour Inspectorate in relation to the employ-ment record books, and the appropriate Com-mercial Register for the address in relation to the accounts and tax books.
2.2
STEPS FOR STARTING
UP A BUSINESS
investment at the General Bureau of Commerce and Investment (Dirección General de Comercio e Inversiones) and Foreign Investment Register (Registro de Inversiones Extranjeras) of the Ministry of Finance (Ministerio de Economia).
In case of foreign administrators
2. HOW TO ST
ART A BUSINESS IN BARCELONA
2.2.2 STEPS FOR SETTING UP A
COMPANY (SA / SL)
Steps
1. Certificate of availability of company name (Certificació Negativa de Denominació Social).
2. Opening a current account and requesting a certificate confirming that the share capital has been paid into the bank.
3. Drafting the company by-laws. 4. Granting powers of attorney.
5. Executing the deed of incorporation of the company.
6. Census declaration that the provisional Tax Identification Code (CIF) has been obtained. Registration for the following taxes: - Value Added Tax (VAT)
- Corporate Income Tax (Impost de Societats) - Business Tax (Impost sobre Activitats
Econòmiques).
7. Paying Property Transfer Tax and Stamp Duty (Impost de Transmissions Patrimonials i Actes Jurídics Documentats, ITP i AJD).
8. Registration at the Commercial Register.
9. Obtaining the required licences, autho-risations and administrative registrations. 10. Registering the company with the Social
Security system.
11. Registering the workers with the Social Security system.
12. Notice of opening of the business premises.
13. Obtaining the definitive Tax Identification Code (CIF).
14. Legalisation of the company records.
Description
It provides evidence that the name chosen for the company has not already been taken by another existing company. The name is reserved for 15 months. The certificate, however, is only valid for two months, although it can be renewed, and it must be provided at the act of incorporation before a notary public.
This is in order to pay in the minimum share capital and provide evidence of this payment to the notary when executing the deed of incorporation of the company
They set out the essential rules for the operation of the company. A document whereby a member who is unable to attend the act of incorporation of the company before a Notary Public empowers another to appear on his or her behalf. This can also be granted
abroadif the document includes a 1961 Hague Convention apostille (a stamp which gives effect in Spain to the power of attorney granted).
This is the act of appearance of the members or their representatives before a Notary Public formalising the incorporation of the company Submittal of the official form (036) to obtain a provisional Tax Identification Code which will identify the company for tax purposes, and notifying the administration of the commencement of the company’s activities. Submitting form 036 results in automatic registration. New companies are exempt from paying Business Tax during the first two years of activity. Following this time, they will only be subject to this tax after a certain turnover threshold.
This is 1% of the share capital and is necessary in order to register the company at the Commercial Register.
This publicises the fact of the incorporation of the company by which it gains legal personality..
These vary depending on the type of business activity.
Obligation to register the company with the relevant Social Security regime. at Social.
Obligations relating to the workers´Social Security registration, TA-1 card form for the first registration, and TA-2 card form with details of the business and the workers.
Notification of commencement of a new activity to the relevant labour authority, regardless of its type and of whether or not the business hires workers.
Obtaining the definitive Tax Identification Code card.
This consists of 4 books: the Journal, the Inventory Book, the Annual Accounts, the Minute Book and, in the case of a sole shareholder, the Register of Contracts with the sole shareholder.
Institution / Organisation
Central Commercial Register (Registre Mercantil Central).
Any bank or savings bank.
Law firm.
Notary Public’s Office.
Notary Public’s Office.
Any branch of the State Tax Administration Agency (Agència Estatal de l'Administració Tributària) for the company’s tax address. Deadline: before commencing the activity.
The Catalonian Government’s General Tax Department.
Deadline: within one month following the execution of the deed of incorporation of the company.
The Commercial Register which corresponds to the company’s registered address. Deadline: within two months following the execution of the deed of incorporation of the company. Public administrations (regional and local). Deadline: before commencing the activity The Provincial Department of the Social Security Regional Treasury (Direcció Provincial de la Tresoreria Territorial de la Seguretat Social) which corresponds to the company’s registered address. Deadline: before commencing the activity and hiring the first worker.
The Provincial Department of the Social Security Regional Treasury (Direcció Provincial de la Tresoreria Territorial de la Seguretat Social) which corresponds to the company’s registered address. Deadline: before workers start to join.
The Catalonian Government’s Ministry of Employment (Departament de Treball). Deadline: 30 days following the opening of the premises. Any branch of the State Tax Administration Agency (Agència Estatal de l'Administració Tributària) for the company’s tax address. Deadline: 6 months after the issue of the provisional card (Step No.6).
The Commercial Register which corresponds to the company’s registered address.
The total time period is
29
2.3.1 TAXES
Under current Spanish legislation, tax obligations in Catalonia are among the least onerous in the Eurozone.
In this section, foreign investors can become familiar with the main tax concepts which apply here and ascertain their possible impact on business activities.
The tax regime applicable in Barcelona comprises several different taxes which can be divided into direct, indirect and local taxes:
Direct taxes:these are taxes payable on income. In the case of economic activities, tax is paid on the difference between income and expenditure. One must make a distinction between income tax paid by natural persons
(Personal Income Tax - Impost sobre la Renda de les Persones Físiques, IRPF) and income tax paid by legal persons (Corporate Income Tax - Impost sobre Societats, IS). The main difference is that Corporate Income Tax always uses accounts, whereas these are not usually required for Personal Income Tax, although records of income and expenditure do exist.
In addition, there is a special module regime for Personal Income Tax (in which income is calculated on the basis of objective parameters) if the limits stipulated by the laws governing specific activities - especially small businesses such as bars/cafés and shoe shops - are met.
- Personal Income Tax (IRPF) is a progressive tax applicable to available income, i.e. the total amount of income received during the calendar year minus specific essential minimum
amounts determined by the law. Taxation is based on a progressive rate scale ranging from 15% to 45%.
Increases and reductions in assets
(generally sales of assets which are not
business stock) are taxed at a fixed rate of
15% (one of the lowest in Europe).
For foreign workers who have been transferred to Spain, there is a regime to reduce the cost to the employer: their salaries (usually agreed as net amounts) are taxed at just 25%.
- Corporate Income tax (IS) is charged on income received by legal persons or companies. The general rate is 35%. However, small companies (with a turnover of less than €8 million) profits of up to €120, €202.40 are taxed at a flat rate of 30%.
2.2.3 STEPS FOR SETTING UP
A
BRANCH / REPRESENTATIVE OFFICE
The steps are similar to those required for setting up a company, although the following specific issues are worth mentioning:
Steps
1. Executing the deed of incorporation of the branch / representative office.
2. Opening a current account and transferring funds.
Description
The following documents relating to the foreign parent company must be provided:
- Resolution of the relevant corporate body egarding the decision to set up the branch or representative office.
- Granting of powers of attorney to the representative / manager of the branch / representative office.
- Certificate of the registry or relevant authority of the parent company’s country confirming the validity of the parent’s existence, the currency of its by-laws and the offices held by its directors. Although no minimum capital is required, it must be given the necessary funds to carry out its business.
Institution / Organisation
Notary Public’s Office.
Any bank or savings bank.
2.3
TAX REGIME,
2. HOW TO ST
ART A BUSINESS IN BARCELONA
30
In addition, the tax rate is noticeably reduced when certain legally established tax benefits, such as those affecting research, development and innovation activities, are applied.
In addition, the deduction for reinvestment of profit means that capital gains on certain assets are taxed at 15% provided the amount obtained from their transfer is reinvested under the conditions stipulated by the law.
Indirect taxes: these are taxes payable on consumption. There are two main types of indirect tax:
Value Added Tax (IVA) and Property Transfer Tax and Stamp Duty (Impost de Transmissions Patrimonials i Actes Jurídics Documentats, ITP i AJD).
- Value Added Tax (IVA): this applies to business activities and is ultimately supported by consumers.
- Property Transfer Tax and Stamp Duty (ITP and AJD): this applies to transfers between persons other than entrepreneurs and to certain real property transactions.
Local Taxes: City Councils charge various taxes on economic activity:
- Business Tax (Impost sobre Activitats Econòmiques, IAE): this tax is calculated on the basis of objective parameters, such as the activity and the number of square metres of the premises in which the business is conducted.
There is an exemption for natural persons and businesses with a turnover of under €1 million.
GENERAL TABLE OF THE MAIN TAXES APPLICABLE TO BUSINESSES IN CATALONIA
DIRECT TAXES:
on business profit
PERSONAL INCOME TAX (IRPF)
INDIRECT TAXES:
on consumption
LOCAL TAXES:
on other items
(LEGAL PERSONS):
General rate of 35% with certain allowances
CORPORATE INCOME TAX (IS)
VALUE ADDED TAX (IVA)
On ownership of real property
LOCAL PROPERTY TAX (IBI)
BUSINESS TAX (IAE) PROPERTY TRANSFER TAX (ITP)
TAXES
OTHER TAXES
(NATURAL PERSONS):
Progressive scale ranging from 15% to 45%
On the exercise of business activities (companies only)
For rubbish collection, on ownership of vehicles, etc. This is charged at three different rates: 4%, 7% and 16%