Britain’s love affair with Spain continues to blossom.
Seventeen million British tourists visit each year, while the laid-back lifestyle has inspired around 750,000 Brits to move there permanently.
Many Spanish companies are involved in Latin America for linguistic and historic reasons, offering opportunities for British firms to work in partnership with them in the region
Since Spain joined the EU in 1986 its economy has developed substantially. Growth in Anglo-Spanish trade has been dramatic, making Spain the UK’s seventh largest export market.
Huge market
The economy grew by 3.8% in 2007, higher than the EU average and its 14th consecutive year of growth. As the second largest country in Western Europe with a population of 40 million people, it offers entrepreneurs a huge market and imposes no major restrictions on foreign nationals setting up businesses.
Many Spanish companies are involved in Latin America for linguistic and historic reasons, offering opportunities for British firms to work in partnership with them in the region.
British companies have traditionally manufactured products in Spain in a number of different industries, including food, chemicals and automotive components. In recent years investments have greatly diversified, with a strong British presence in service industries — especially in consultancy, law, project management and estate agency.
There are also opportunities in telecoms equipment, automotives, office machinery, pharmaceuticals, industrial machinery, and textiles and clothing. Investment opportunities are also being created in sectors such as energy, telecoms and utilities thanks to the deregulation and liberalisation of these markets.
Britain is the second largest overseas investor in property in Spain. The proximity of the two countries and the emergence of budget airlines has made property investment increasingly tempting.
The EU’s removal of financial barriers has made it cheaper and easier than ever to invest in Spain, and in law you should be treated no differently to a citizen of that country, so the tax implications are minimal.
As one of the first countries to join the Economic and Monetary Union, Spain remains the largest beneficiary of EU structural and cohesion funds. This has allowed the government to embark on major infrastructure projects, offering overseas firms the chance to work with Spanish companies.
Until recently these projects, sustained economic growth and a buoyant property market contributed to a booming construction industry accounting for 16% of economic output — about twice the EU average — but the global downturn put paid to that.
Local representative
British entrepreneurs should seriously consider appointing a local representative, ideally one who is well connected and knows the market. It is also possible to hire a Spanish gestor, whose role is particular to Spain. Though not a lawyer as such, a gestor can deal with your paperwork for a reasonable fee.
Businesses making larger investments can enter into joint venture partnerships or set up owned, or partly owned, subsidiaries. The regulations are diverse, so British businesses are advised to research the market and gain professional legal, financial and taxation advice before acting.
Business hours in Spain differ greatly from the UK’s. Retail or industrial premises generally start work at eight, stopping between one and four and then continuing until about six. Offices often stay open until eight in the evening, with a long lunch break between two and four in the afternoon. From June to September most offices operate on ‘summer time’, starting at half past eight and closing at three in the afternoon.
