Opening a branch of a foreign company in Spain: registration and obligations

The branch is a secondary business centre, endowed with permanent representation and a certain degree of management autonomy, through which the foreign company carries out its activity in Spain. It does not have its own legal personality: it is the same legal entity as the parent company, which is liable for all its debts.

Art. 15 of the Código de Comercio (the Spanish Commercial Code) allows companies incorporated abroad to trade in Spain: their capacity is governed by the law of their country, but the creation of establishments in Spanish territory is subject to Spanish law. The registration of the branch is regulated in arts. 295 to 308 of the Reglamento del Registro Mercantil (RD 1784/1996).

It is advisable to open a branch when the company will have continuous activity in Spain (premises, team, recurring contracts) and does not want to create a new Spanish company. No minimum capital is required: the allocation of funds to the branch is optional. If you are looking to limit liability to the Spanish business, the alternative is to set up an SL subsidiary (see the comparison below).

Please note: operating stably in Spain without registering the branch causes practical problems. The Directorate General for Legal Certainty and Public Faith has confirmed assessments requiring the branch to be registered in accordance with arts. 295 and following of the RRM for a foreign company to act normally in Spanish legal traffic.

Art. 300 of the RRM requires the presentation, duly legalised, of the documents proving the existence of the company, its current articles of association and its directors, in addition to the document establishing the branch (the resolution of the competent body of the parent company).

In practice you will need: a current certificate from the parent company's registry of origin (existence, registration details, directors), the deed of incorporation and current articles of association, the resolution to open the branch with its address in Spain, activities and funding if applicable, and the appointment of the permanent representative stating their powers.

Legalisation: if the country of origin is a party to the Hague Convention, the apostille is sufficient; if not, consular legalisation is required. All foreign documents must be accompanied by a sworn translation into Spanish.

With this documentation, a public deed is executed before a Spanish notario, in which the permanent representative usually accepts the position. For companies from another EU Member State, the verification of the parent company's data is simplified: the registrar checks them through the European business registers interconnection system using the EUID identifier (art. 308 ter RRM).

Managora reviews your parent company's documentation, tells you exactly what needs to be apostilled and translated and drafts the complete registration application. You can see the updated price in the procedure details.

The branch must have one or more representatives appointed on a permanent basis, whose identity and powers are recorded in the registration (arts. 297 and 300 RRM). This is the person who acts in Spain on behalf of the foreign company.

It can be any natural (or legal) person designated by the parent company, whether or not they reside in Spain, although they will need a Spanish NIF or NIE (foreigner identity number) to operate. It is advisable to grant them broad powers: to contract, open and manage bank accounts, represent the company before public administrations and courts, and everything necessary for the ordinary management of the establishment.

On the tax front, the Impuesto sobre la Renta de no Residentes (Non-Resident Income Tax) regulations provide for the appointment of a representative before the AEAT (the Spanish tax agency) for those operating through a permanent establishment, with exceptions for residents in the EU or in States with mutual assistance. Managora includes the appointment of the permanent representative and the description of their powers in the registration application.

Filing of accounts: the general rule of art. 375 of the RRM is that the foreign company files its own annual accounts (those of the parent company) and, where appropriate, the consolidated ones, prepared in accordance with its legislation, in the Commercial Registry of the branch. If they are already filed in the registry of its country, the registrar's assessment is limited to verifying this fact: it is a mere transfer, as confirmed by the Directorate General in its resolution of 7 January 2011.

Equivalence control (art. 376 RRM): if the legislation of the country of origin does not require the preparation of accounts, or requires them in a form not equivalent to the Spanish one, the company must prepare accounts referring to the activity of the branch and file them in the Commercial Registry. This is the typical case for parent companies from countries with no public filing obligation.

The filing obligation is strict: the Directorate General (resolution of 9 July 2015) points out that the content of arts. 375 and 376 leaves no room for controversy. Failure to file can lead to registry and penalty consequences.

Added to this are the periodic tax obligations of the permanent establishment: annual form 200, instalment payments, VAT and withholdings if applicable (see the obligations table).

The branch is the classic example of a permanent establishment (PE) of a non-resident entity. It is not taxed under Impuesto sobre Sociedades (Corporate Tax) like a Spanish company, but under Impuesto sobre la Renta de no Residentes (IRNR, Non-Resident Income Tax) with a permanent establishment, although in practice the result is very similar: it declares on the same form 200 and for the profit attributable to the establishment.

The tax rate is the one corresponding to the Impuesto sobre Sociedades regulations: the general rate is 25% (AEAT headquarters, valid as of 3 August 2026). The base is calculated in accordance with the general IS (Corporate Tax) regime, with special rules on expenses allocated by the head office.

There is also a supplementary tax on the amounts that the permanent establishment transfers abroad from its income. It does not apply when the head office resides in another EU State (except non-cooperative jurisdictions) or when it resides in a State with a double taxation agreement with Spain that does not provide otherwise, with reciprocity.

The branch needs its own NIF before operating: the AEAT assigns permanent establishments of non-resident entities a NIF starting with the letter W (Orden EHA/451/2008). It is requested with form 036, which also serves for the census registration (IAE, VAT, withholdings).

Ready to open your branch? Managora identifies the parent company and branch, reviews apostilles and sworn translations, coordinates the NIF with form 036 and drafts and submits the registration application to the competent Commercial Registry. You can see the updated price in the procedure details and start today.