On last December 28, the Official Gazette of the Spanish State published Act 16/2012, December 27, adopting several tax measures aimed at the consolidation of public finances and the promotion of economic activity, as a continuation of the package of measures recently adopted, in order to consolidate public finances and correct the main imbalances of the Spanish economy for a greatly-awaited emergence from the crisis.

Among the measures approved, we highlight the amendment of given aspects of the regulation applicable to Listed Real Estate Investment Companies (so called SOCIMI). Such entities were created in the year 2009 by means of Act 11/2009, October 26, in order to create a new instrument for investment aimed at the urban leasing real estate market.

Due to the scarce reception of such entities on the market, a revision of their legal framework was undertaken to encourage their promotion in the Spanish market, as occurs in other countries of our environment, in an endeavor to maximize and stimulate a Spanish real estate market that has been seriously affected by the crisis.

While the main novelty lies in the tax treatment of SOCIMIs, as we indicate more extensively in another of the articles of this issue of our newsletter, a series of amendments to the substantive scope of these entities is also worthy of mention.

Perhaps the most significant novelty lies in the ability of the SOCIMI to be listed on a multilateral trading system, and the possibility of their quotation on the Alternative Stock Exchange (so called MAB). It is obvious that the requirements and procedures for listing on the MAB will entail an important advantage, since these are more flexible and less costly that those envisaged for trading on the Spanish stock exchange.

Likewise, together with the reduced minimum share capital requirement of five million euros, the prior restriction on outside financing is eliminated and the assets of SOCIMIs may now be composed of one sole property. Greater flexibility is thus given to some of the requirements imposed by prior Act 11/2009 under amendment and which, to our understanding, had not done much to facilitate the incorporation of these entities.

Without embarking upon further amendments, which will be announced in another of our articles, we merely wish to mention that the amendments of Act 11/2009 will take effect for the tax periods commencing as of January 1, 2013.

We should therefore await the upcoming months in order to verify the results of the amendments implemented and see whether these allow the SOCIMI to have the same reception that the REIT (Real Estate Investment Trust) has had in other countries for some time, and which has served as an inspirational figure for the SOCIMI; although everything appears to indicate that this time the proposed objective will be achieved.