Foreign entrepreneurs willing to invest in the Spanish equity capital market can use a wide range of investment vehicles. Business in Spain attracts development finance through stocks and bonds. Investors get the opportunity to profitably place temporarily free funds. The market is performing well, so, be smart while everyone else is panicking!
If you are wisely considering setting up a private equity fund in Spain, you may find this post helpful. Keep reading to find out why you might want to add Spain to your list of investment destinations.
Regulatory framework
Spain, as an EU Member State, uses European directives to establish an investment fund. The directives are now being amended in order to remove burdensome requirements and harmonize diverging national rules.
Today, the boundaries between private equity and venture capital funds are actively blurring in Europe. The latter are increasingly investing in companies in the later stages of the business cycle, while the former pour capital in companies in earlier stages. Ultimately, both earn in the same way - by buying companies and increasing their value.
Three types of venture capital enterprises successfully operate in Spain today:
- private equity funds (FCR);
- direct investment companies (SCR);
- start-ups and early-stage companies (ECRs-Pyme).
All of them must be authorized with the Spanish Securities Commission.
How to launch a Spanish PE fund
Establishing an ECR in Spain is possible on the basis of a registration provided by a public notary and reflected in the Commercial Register.
When launching a Spanish SCR, you have to collect and submit the package of documents including a prospectus, public deed of incorporation, and company articles of association. The charter must contain an investment policy.
Alternative listing
If you are planning to enter the Spanish stock market, look out for the Alternative Stock and Exchange Market, which has recently opened a dedicated segment for ECR listing.
The criteria for the listing are as follows:
- a specialized agency responsible for the register of shareholders or owners of property rights;
- notifying about liquidity;
- informing about all situations that may affect the trading of shares.
Final word
The openness of the Spanish capital market and the variety of investment instruments provide investors with the opportunity to form an investment portfolio for every taste in terms of profitability, risk, and investment timing.
Do not hesitate to contact the legal experts of our company if you need assistance in the establishment of an investment fund in Spain, or if you would like to get a consultation on venture financing in Spain.
