Supranational Restructuring of Business Groups

The difficulties of the Spanish market in recent years have forced businesses to embark on unprecedented internationalization.

Even though the bureaucratic obstacles and the difficulty in managing various jurisdictions continue to be a clear barrier of entry even in the European Union, the truth is that a greater homogenization of the legislative framework is taking place, which affects the business structure.

In this context, the Law on structural modifications of Commercial Businesses(LME) welcomed the Directive of the European Parliament and Council 2005/56/CE, October 26, 2005, referring to cross-border mergers of liability companies; along with the Directive 2007/63/CE of the European Parliament and Council, November 13, 2007, by which the Directives 78/855/CEE and 82/891/CEE of the Council were modified regarding the requirement of the presentation of a report by an independent expert in case of merger or division of public limited corporations.

These regulations represented a breakthrough in the harmonization of the restructuring operations of cross-border dimension business groups or even by means of cross-border fusion with non-EU corporations.

Another major contribution of the LME to the mobility of corporations was the

regulation- for the first time in Spanish Law- of the transfer of the address of a Spanish corporation to a foreign country, and the transfer to Spanish territory of corporations established according to the law of other countries.

From the point of view of the taxation of these restructuring operations there has been an improvement in the treatment of the structures in which the partners or stockholders in the restructuring corporations are not residents in Spain. In this way, current regulations starting January 1st, 2015, expand the scope of the Special non-monetary contributions, so that these contributions can benefit from tax neutrality, whether they were made by IRPF contributors or IRNE contributors without a permanent establishment, whether the contributions are made from a Spanish corporation or not (provided it does not have as an activity the management of property or real estate according to the article 4.8 Dos of the Law of Wealth Tax).

In conclusion, we find that the most favorable legislative framework to date has been established in order to handle the ordination of resources invested in the process of internationalization of our companies. NEXOR LEGAL has extensive experience in the design of restructuring operations that allow for the reorganization of the international commercial structure in order to best serve the development of the business group.