At UHY Fay & Co, we provide expert guidance through the certification process required by the “Spanish Act to Promote the Ecosystem of Startup Companies” (commonly known as the Spanish Startup Law).
Our team ensures your business meets all legal and financial criteria to successfully obtain the ENISA certification, unlocking significant incentives for your growth in Spain.
What is the Spanish Startup Law?
The Spanish Startup Law aims to foster the growth of emerging companies by promoting innovation and investment. To benefit from the fiscal and social incentives, companies must be certified as “innovative” and “scalable.”
At UHY Fay & Co, we help you prepare the technical documentation and business plans required by ENISA to secure this status.
Main Advantages of Being a Certified Startup in Spain
Obtaining the official certification offers a range of competitive advantages:
- Tax Reduction: Corporate Income Tax (CIT) rate is reduced to 15%.
- Treasury Benefits: Deferral of tax debts and exemption from making installment payments for CIT.
- Investor Facilities: Foreign non-resident investors are exempt from obtaining a NIE (Foreigner Identity Number).
- Talent Attraction: Tax-exempt amount for stock options increases to €50,000 annually.
- Investment Incentives: Deduction for investments in new companies rises to 50%, with a maximum base of €100,000.
- Social Security Discounts: A three-year discount for self-employed entrepreneurs in a state of “pluriactivity” (working as an employee and founder).
What are the Requirements to be Certified?
To qualify under the Spanish Startup Law, your company must meet these specific criteria:
- Company Age: Less than 5 years old (or 7 years for biotechnology, energy, or strategic industrial sectors).
- Innovation: Must develop an innovative project with a scalable business model.
- Revenue: Annual turnover must not exceed €10 million.
- Dividends: No dividends must have been distributed since the company’s formation.
- Location: Registered office or permanent establishment must be in Spain.
- Workforce: At least 60% of employees must have a labor contract in Spain.
- Public Status: Must not be listed on a regulated stock market.
- Compliance: Founders and shareholders (with 5% or more) must be up to date with Tax and Social Security obligations.
- Sustainability: The activity must not cause significant environmental harm.
How is Innovation and Scalability Assessed?
ENISA evaluates the project based on several key metrics:
- Degree of Innovation: R&D expenses and previous public funding.
- Market Attractiveness: Supply, demand, and client acquisition strategies.
- Life Stage: Status of prototypes or Minimum Viable Product (MVP).
- Business Model: Scalability of users, operations, and revenue.
- Team: Experience and background of the founding members.
- Risk Profile: Absence of reputational, ethical, or speculative risks.
The Certification Process through ENISA
The application must be submitted through ENISA’s digital platform (Link to ENISA portal).
- Timeline: ENISA has three months to issue a resolution once all documentation is provided.
- Validity: The certification lasts as long as requirements are met, up to the 5-year limit (or 7 for biotech).
- Loss of Status: Status is lost if the startup is acquired by a non-emerging company or if turnover exceeds €10 million.
How Can UHY Fay & Co Help?
UHY Fay & Co specializes in the end-to-end preparation of the documentation required for the Startup Law certification.
Our multidisciplinary team, composed of lawyers, economists, and sustainability experts, provides comprehensive analysis and full support to ensure your company meets all regulatory requirements and successfully transitions from a “new company” to a “certified startup”.
Ready to certify your business? Contact our experts today to start the process and leverage the full power of the Spanish Startup Law.
