Liaison Office in Spain

The liaison office in Spain, also known as the representative office, is a legal structure designed to represent the parent company from abroad in Spain, but which does not have a separate legal entity. Our company registration agents in Spain can help you open a liaison office and make all the necessary arrangements and formalities not only to set up this type of office, but also to open a company. 

Quick Facts
The purpose of a liaison office in Spain	For: – promoting the activities of a foreign company in Spain, – testing the market, – negotiating business contracts with possible local clients
How is the liaison office known in Spain?	Also known as a representative office
How can a representative office be registered in Spain?	By presenting the formation documents of the foreign company, completing other standard forms at the local agencies
Can a liaison office in Spain have commercial activities? (YES/NO)	NO
Contracting potential clients and partners (YES/NO)	YES
Local agent required (YES/NO)	YES
Attributes of a liaison officer	– researching the local market, – advertising and promoting the business activities of the foreign company, – contacting local customers, – communicating with the foreign company
Bank account for a liaison office in Spain	Required for the expenses of the liaison office in Spain
Allowed to invoice local customers	Not allowed
The institution that authorizes the liaison office in Spain	Spanish Trade Register – the formation documents must be signed in front of a notary in Spain.
The costs of opening a representative office in Spain	Supported by the foreign company represented in Spain
Travel requirements	Not mandatory
Business advertising through a liaison office in Spain	The products, services, and activities of a foreign company can be promoted in Spain through a liaison office.
Time frame for opening a liaison office in Spain	A few days
Why choose our company formation agents in Spain?	We can offer: – support in preparing the documents for opening a liaison office in Spain, – complete assistance for varied procedures, – affordable prices
Representative office name	The same as the parent company’s
Judicial capacity	None
Types of companies that can use a liaison office in Spain	Generally large companies that need to test the Spanish market before committing to investing here.
Who can be appointed as a liaison office representative in Spain?	Usually this is a natural person, designated by the parent company.
Limitations to the liaison office according to the jurisdiction in which the parent company is incorporated	None
Liaison office employees	As needed to engage in the promotional/other specific activities
Minimum/maximum number of employees	No prescribed minimum/maximum
Alternatives to the representative office in Spain	Branch/ subsidiary
Possibility to change the liaison office into a corporation	Only if the parent company follows the steps to open a branch or a subsidiary (legal entities)
When can a liaison office be changed into a branch or a subsidiary?	After the parent company has completed the market research activities and it is ready to start trading.
General incorporation requirements if the company decides to open a company instead of a liaison office	Observe the minimum shareholder and minimum share capital requirements according to the chosen business form, as well as the registration and licensing requirements.
When to make the switch from liaison office to corporation	When the parent company decides that it is suitable to start engaging in trade/economic activities in Spain.
Reasons to invest in Spain	A dynamic economy opened to foreign investments, good infrastructure, access to international and local talent, etc.
How we can assist you	With complete support during the formation of the liaison office in Spain and with other company incorporation steps.
When to reach out to our team	As soon as you decide to open a representative office in Spain, or another business form.

Key features of a liaison office in Spain

It is very important that when you want to set up a company in Spain, you know the characteristics of the chosen business structure. In the case of a representative office in Spain, the following characteristics are important:

• There is no separate legal personality from the parent company in the case of a liaison office in Spain.
• Commercial transactions having a liaison office in Spain are not undertaken.
• It is necessary to register with the local authorities for social security, taxation, and employment.
• All debts assumed by the liaison office in Spain enter the attention of the parent company.
• The representative officer is in charge of various responsibilities, must communicate with the parent company, and develop different marketing and advertising strategies.

We recommend those interested in company incorporation in Spain and especially the formalities for opening a liaison office to contact our specialists for specialized support. We also recommend the following infographic:

What are the characteristics of a Spanish liaison office? 

The basic aspect regarding a Spanish liaison office is that it can’t start business activities and thus, it can’t be used for opening a company in Spain. Since it is not set up as a legal entity, being a sub-division of the parent company abroad, the representative office in Spain is not required to comply with the regulations prescribed by the commercial law. The following are also available for a liaison office: 

• it does not need a formal management body established in Spain;
• the management responsibilities of a Spanish liaison office fall under the supervision of the person who was appointed as a representative;
• in the case in which the liaison office has any debts during its activity in Spain, the parent company abroad will be fully responsible for their payment;
• although it is not bound by the provisions of the Spanish commercial law, the liaison office must register for tax employment, and social security purposes.

More details on the representative office in Spain are available in the next video:

What are the registration steps for Spanish liaison offices? 

As a general rule, the procedure of company formation in Spain involves registration with the Mercantile Registry, this being one of the several institutions where new businesses have to register. However, in the case of a Spanish representative office, this step is not required. 

The establishment of a liaison office in Spain is done through a public deed, that has to be signed in front of a Spanish public notary. The liaison office may also be set up in the presence of a foreign notary and legalized by the Hague Apostille system or another legalization method that is recognized in Spain; our team of specialists in company registration in Spain can offer more information on the types of documents that can be used for the establishment of a representative office. 

What are the responsibilities of a liaison officer in Spain?

A representative officer in Spain has various responsibilities and first of all, he must be a good communicator. He or she must know the business direction of the company they represent in Spain to carry out their activities. He or she must also know the marketing strategies and promote the company and its activities on the territory of Spain.

There are situations in which business conflicts can arise. A liaison officer must know how to handle such cases and mediate conflicts in the best possible way. On the other hand, a liaison officer in Spain must submit various reports to the parent company, with information on how the advertising methods of the company in question were implemented and their results. Negotiator skills come into question when a liaison officer in Spain tries to contract various clients and collaborators from the local market.

We invite you to discuss with our local agents the formalities of opening a liaison office in Spain. We are here to offer you the necessary support if you want to open a company in Spain, regardless of your preferred business structure.

What are the employment requirements in Spain? 

As specified above, the liaison office in Spain needs to register for employment and social security, since it will hire employees in this country. This is available for any type of entity operating in Spain that hires local or foreign workforce which develops its activity on the Spanish territory. 

Thus, the liaison office is legally required to register with the Spanish Social Security General Treasury prior to the commencement of the local activities. The representative of a liaison office needs to register with the institution by submitting specific forms and by notifying the institution of the number of employees the entity has. The notification can be sent in an electronic format. 

According to the Spanish employment law, any employer in Spain must also guarantee the safety and health of their employees during their work activities. Thus, any party registering for social security purposes must also include an occupational risk prevention plan when applying with the Spanish institution. 

In which fields can a liaison office be active in Spain?

There are many world institutions and organizations that open their liaison offices in various countries, including in Spain. Many are found either in social fields or in manufacturing, IT, trading, or infrastructure. There are many liaison offices active in the field of health or education, but everything depends on the business plans of the company concerned.

Advantages of a liaison office in Spain

As we presented above, the liaison office in Spain can be used as a means of testing the local market, but also to establish a better communication between the Spanish clients, partners, and others, and the parent company abroad. 

However, the liaison office can provide other advantages and it can be used by those businesses that want to have a value added tax (VAT) number in Spain or local employees. This type of representative office in Spain can also be selected for businesses that want to have a warehouse in this country, but which can only be used for distribution purposes. 

Making investments in Spain

Spain is among the countries with a stable business climate, and Madrid was declared the most important business center in Europe, due to the optimal conditions offered for conducting business. With an extremely developed infrastructure, a highly appreciated tourism sector, and a diversified economy, Spain is a major investment destination in Europe and chosen by many international entrepreneurs. Here are some statistical data about the Spanish economy, if you want to start a company here:

• In 2022, the GDP in Spain was around EUR 1,328 billion.
• Around EUR 262.12 billion was the total non-financial resources registered in Spain in 2022.
• The main part of Spain’s GDP, around 58%, is household consumption, followed by gross fixed capital formation.

For more information about investing and how to open a company in Spain, you can contact us. On the other hand, you can benefit from the services of our accountants in Spain. Our specialists can tell you more about bookkeeping in Spain for companies registered here.