A company law lawyer (abogado de derecho societario) advises a business and its shareholders in Spain on everything to do with the company as such: how it is set up, how power and profits are shared out, how decisions are taken at the general meeting, what responsibilities the directors have and what happens when a shareholder wants to leave, the business is sold or it has to be closed. Their job is to make the internal rules clear before a dispute arises and, if one does, to defend their client.

What company law is and what it is for

Company law (derecho societario) is the part of commercial law that governs companies: how they are created, organised, changed and brought to an end. In Spain the main piece of legislation is the Spanish Companies Act (Ley de Sociedades de Capital, the consolidated text approved by Real Decreto Legislativo 1/2010), which applies to limited companies (SL) and public limited companies (SA). It is supplemented by the Commercial Code (Código de Comercio), the Companies Registry Regulations (Reglamento del Registro Mercantil) and the rules on structural changes (mergers, demergers and conversions), now contained in Real Decreto-ley 5/2023.

Its role is to balance interests that do not always coincide:

  • Shareholders among themselves: who decides and with what majority, how the minority is protected, how dividends are distributed and what happens if someone wants to sell their stake.
  • Shareholders and directors: who manages the day-to-day business, how they are supervised and when they are liable for their decisions.
  • The company and third parties: creditors, banks, suppliers and customers need to know who can bind the company and what assets it answers with. That is why the articles of association, appointments and annual accounts are made public at the Companies Registry (Registro Mercantil).

What a company law lawyer does

When the company is set up

They help you choose the legal form (the differences are set out in the guide to types of company in Spain) and draft articles of association tailored to your case rather than a standard template: majorities for important decisions, rules for selling shares, the type of management body or directors’ remuneration. They usually also prepare the shareholders’ agreement (pacto de socios), the private agreement that supplements the articles. We explain the formalities of the company name, the notary and registration on the page on setting up a company.

In the day-to-day life of the company

They call and document general meetings and board meetings, draft minutes and certificates, and prepare the transactions that change the company: capital increases or reductions, the entry of new shareholders or investors, the appointment and removal of directors, and changes of registered office or corporate purpose. They also keep an eye on the legal deadlines for the annual accounts: the directors must draw them up within three months of the end of the financial year, the general meeting must approve them within six months of the year end, and they must be filed at the Companies Registry in the month following their approval.

When there is a dispute between shareholders

This is one of the situations where they are needed most: deadlocks at the general meeting when two shareholders each hold half, minority shareholders who receive no information or dividends, resolutions that someone considers contrary to the law or to the articles of association, shareholders who want to leave or whom others want to exclude. The lawyer looks at whether it is possible to challenge a resolution, to exercise the right of withdrawal (derecho de separación) in the cases provided for by law or by the articles, or how to value the shares of the shareholder who is leaving. Often their best work is negotiating an exit before the matter reaches court.

Directors’ duties and liability

A director has duties of care and loyalty and can be liable to the company, the shareholders and the creditors for damage caused by acts contrary to the law or to the articles of association, or by breaching those duties. In addition, if the company has a legal ground for dissolution, for example because losses leave its net equity below half of the share capital, and the director does not call the general meeting within two months to dissolve it or remedy the situation, they can be liable with their own assets for the company’s subsequent debts. If the company is insolvent, Spanish insolvency law adds the duty to file for insolvency proceedings (concurso) in time. A company law lawyer explains what to do in each case.

Sales, purchases and restructurings

They are involved in the purchase or sale of a business or part of one, with the prior review of its legal position (known as due diligence) and the negotiation of the contract; in mergers, demergers and conversions, such as changing from an SL to an SA; in the dissolution and liquidation when the project comes to an end; and in the succession of a family business.

Company law, commercial law and corporate law: are they the same?

They are used almost as synonyms, but they do not mean exactly the same thing:

  • Commercial law (derecho mercantil) is the broad concept: it covers companies, but also contracts between businesses, distribution, competition, industrial property and insolvency.
  • Company law (derecho societario) is the part that deals with the company “from the inside”: shareholders, general meetings, directors, capital and corporate transactions.
  • Corporate law (derecho corporativo) is an expression that comes from the English corporate law. In Spain it is used to refer to company law advice for businesses and to sale and purchase, merger or investment transactions.

In practice, many commercial lawyers handle all three; what matters is that they have experience in your type of matter. And it should not be confused with the tax side: the company’s taxes are handled by a tax lawyer or tax adviser, although in a sale or a merger they normally work together.

How much does a lawyer charge for a commercial case in Spain?

There is no official scale of fees. Fees are freely agreed and each lawyer or law firm sets their own; bar associations cannot set price scales, only guideline criteria for calculating costs when a judge orders someone to pay them. These are the most common arrangements:

  • Fixed fee per assignment: articles of association, a shareholders’ agreement, preparing a general meeting, a capital increase or a shareholder’s exit.
  • Hourly rate: common in long negotiations, document reviews or complex transactions whose scope is not known at the outset.
  • Monthly retainer (iguala): a fixed fee for SMEs that consult frequently and want to have a go-to lawyer.
  • In litigation: the usual approach is an amount for each stage of the proceedings, sometimes with a variable part added depending on the outcome, if this is agreed in writing.

The amount depends on the complexity of the matter, the number of shareholders involved, what is at stake, the urgency and whether it is necessary to go to court. The same goes for what is usually called corporate law: in hours of work, a company sale and purchase has nothing in common with reviewing a set of articles of association. Always ask for a written quote stating what it includes and what it does not. In matters of legal defence, Ley Orgánica 5/2024 del Derecho de Defensa (the Right of Defence Act) recognises your right to ask for an engagement letter (hoja de encargo) with a prior quote for fees and costs. And if you are going to litigate, ask about court costs too: if you lose, in general you can be ordered to pay the other side’s.

When it is worth consulting a company law lawyer

  • Before setting up a company with other shareholders, especially if you are not all contributing the same or not all of you are going to work in it.
  • Before bringing in a new shareholder or an investor.
  • When disagreements between shareholders are blocking decisions or the distribution of profits.
  • If you are a director and the company is building up losses or has trouble paying.
  • Before buying or selling shares in an SL or an SA, or an entire company.
  • When you want to leave a company and there is no agreement on the price.

If you are in any of these situations, you can tell a commercial lawyer about your case and we will put you in touch with an English-speaking lawyer who specialises in company law, who will explain your options and their quote before starting.

Frequently asked questions

How much does a corporate lawyer charge in Spain?

As in the rest of commercial law, fees are freely agreed: a fixed fee per assignment, an hourly rate or a monthly retainer. It depends above all on the size and complexity of the transaction, so always ask for the quote in writing before starting.

Can the company’s lawyer defend one shareholder against another?

It is not advisable. If there is a dispute between shareholders, the lawyer who advises the company has a conflict of interest; normally each shareholder has their own lawyer.

What is a side agreement between shareholders (pacto parasocial)?

It is a private agreement between the shareholders that supplements the articles of association, such as the shareholders’ agreement. The Spanish Companies Act says that agreements kept private between the shareholders cannot be enforced against the company, which is why it is advisable to coordinate it with the articles.

How long is there to challenge a resolution of the general meeting?

In general, one year. Resolutions whose content is contrary to public policy are not subject to a time limit. It is best to seek advice as soon as possible, because the period starts to run from the date the resolution is adopted or, if it is registered, from its publication in the Companies Registry.