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Foreign investment regime

Spain has a favourable legal framework for foreign investors. Spanish law has adapted its foreign investment rules to a system of general liberalisation, without distinguishing between European Union (EU) residents and non-EU residents.

In addition to the general regime described below, Law 18/1992 of 1 July, establishing rules on foreign investments in Spain, provides a specific regime for non-EU persons investing in certain sectors: national defence-related activities, gambling, television, radio and air transportation.

For EU residents, the only sectors with a specific regime are the manufacture and trade of weapons or national defence-related activities.

i General regime for foreign investments

Royal Decree 664/1999 of 23 April on external investments (RD 664/1999) established a liberalised system for foreign investments in Spain that provides two declaration regimes to inform the Investments Registry of the Ministry of Economy, Industry and Competitiveness:

  1. an ex ante declaration regime that applies only to:
    • investments made from a country or territory identified as a tax haven in Royal Decree 1080/1991 of 5 July. No ex ante declaration is required if the investment is made in listed shares or investment funds registered with the Spanish Securities Market Commission (CNMV) or involves less than 50 per cent of the Spanish company's share capital; or
    • investments made in Spain by non-EU Member States acquiring property to be used as diplomatic or consular offices, except in cases where there is an agreement providing for deregulation under reciprocity rules in compliance with Additional Provision No. 3 of RD 664/1999. The ex ante declaration is not equivalent to a verification, non-objection or clearance requirement and, once the investment has been declared, the investor may carry out the investment; and
  2. an ex post declaration regime, which applies to all foreign investors, including those subject to an ex ante declaration, for administrative, statistical and economic purposes only.

The Council of Ministers can suspend this liberalised system on an ad hoc basis if investments affect, or may affect, public powers, public order, security or public health-related activities. If the liberalisation regime for foreign investments is suspended regarding a specific area or activity, that investment would first require administrative clearance by the Council of Ministers.

ii National defence-related activities

RD 664/1999 suspended the general liberalisation regime relating to foreign investments made in activities directly related to national defence, such as the manufacture or trade of weapons, ammunition, explosives and military equipment.

Therefore, any investment in any of these activities will require an authorisation from the Council of Ministers, except if the investment (1) is made in listed companies that render activities in this sector, (2) is equal to or below 3 per cent of the share capital, and (3) does not allow the foreign investor to directly or indirectly become part of the managing bodies.

iii Gambling

Law 13/2011 of 27 May on the gambling sector, which regulates gambling activities (including online gambling) carried out within a country, provides that direct and indirect non-EU investments in Spanish entities operating in the gambling sector are subject to the provisions of RD 664/1999; therefore, they are liberalised.

However, a Spanish licence must be obtained to operate gambling activities in Spain. Moreover, to operate in-person gambling (and all other gambling carried out at an autonomous regional level), an additional authorisation must be obtained from each autonomous region where gambling is to be carried out.

The regulation, inspection and control of gambling activities in Spain is carried out by the General Directorate of Gambling Planning of the Ministry of Finance and Civil Service.

iv Television and radio (audiovisual sector)

As a general rule, under Law 7/2010 of 31 March, on audiovisual communication, there are no restrictions on the acquisition of holdings in Spanish companies belonging to the audiovisual communication services sector.

However, investors who are citizens or residents in a country that is not a member of the European Economic Area (EEA) can only hold stakes and voting rights in a Spanish audiovisual communication services company that uses spectrum in accordance with the principle of reciprocity.

Additionally, the shareholding held, directly or indirectly, by a non-EEA person in these operators may not exceed 25 per cent of the share capital of the Spanish audiovisual communication services licence holder, and the total shareholding in a Spanish audiovisual communication licence holder by non-EEA persons must not exceed 50 per cent on aggregate.

Certain restrictions also exist regarding simultaneous shareholdings in Spanish licence holders that use spectrum.

The restrictions referred to in the two preceding paragraphs are supervised by the Ministry for Ecological Transition.

v Air transportation

Law 48/1960 of 21 July on air navigation, with Regulation (EC) No. 1008/2008 of the European Parliament and of the Council of 24 September on common rules for the operation of air services in the European Community, together provide that holders of operating licences for air transportation of passengers, cargo or mail, or both, for remuneration must be majority owned and effectively controlled by EU nationals, except as provided for in an agreement with a third country to which the European Union is a party. The airline in question shall at all times be able, on request from the competent licensing authority, to provide evidence that it meets these requirements.

In this context, EU airlines shall also notify the competent licensing authority in advance of any intended mergers or acquisitions and within 14 days of any change in the ownership of any single shareholding that represents 10 per cent or more of the total shareholding of the airline or of its parent or ultimate holding company.

In addition, when an airline becomes aware that the maintenance of operating licences or the exercise of traffic rights derived from air traffic bilateral treaties are at risk, it must make the circumstances public and notify, inter alia, the State Agency for Aviation Safety, which will in turn notify the Ministry of Public Works. From the moment of notification, no acquisition or transfer of shares may be made by foreign individuals or legal entities, unless the acquisition or transfer is accompanied by certification issued by the airline showing that the said acquisition or transfer does not exceed the limits required by the applicable laws or the bilateral air traffic treaties signed by Spain regarding air transport.

Finally, if the airline is aware of any acquisition or transfer of shares that, in breach of the provisions described above, may jeopardise the requirements laid down in the laws and agreements mentioned above, the board of directors of the airline may acquire the shares in question for subsequent cancellation. In such cases, and until such time as the shares are physically transferred to the airline, the board of directors may resolve to suspend the voting rights attached to the shares.

vi Other sectorsTelecommunications

The acquisition of holdings in Spanish companies in the telecommunications sector is liberalised, but certain restrictions exist on the simultaneous holding of telecommunications operators in Spain (see below regarding the acquisition of simultaneous holdings in principal operators).

Moreover, in accordance with Law 9/2014 of 9 May on the regulation of telecommunications, activities can be rendered by EU companies and by non-EU companies provided that, in the latter case, there is an international treaty signed between Spain and the country of the relevant company. However, the Spanish government can authorise exceptions to this regime.

Certain restrictions also exist to prevent anticompetitive hoarding, particularly by restricting the total number of frequencies to be used by the same operator or group of operators, or by providing time limits for the utilisation of the titleholder's rights of use.

The rendering of telecommunications services is subject only to prior communication, except in cases where the use of spectrum is required. In the latter case, a prior concession granted by the Ministry of Energy, Tourism and Digital Agenda for the use of spectrum is required.


Under Law 3/2013 of 4 June, creating the National Commission on Markets and Competition (NCMC), the Ministry for Ecological Transition may supervise acquisitions of shares of (or by) companies undertaking regulated energy activities (regulated gas activities include regasification, primary storage, transportation and distribution of natural gas) or owners of certain types of key energy assets, as such supervision may lead to a post-closing notification of the relevant transaction or potentially, in some cases, even to the imposition of conditions on the acquirer or the target company.

The most notable feature of this supervision is that it is made following an ex post communication regime (i.e., there is no authorisation but rather a communication). Furthermore, in the event of acquisitions made by regulated companies or in the scenario in which the acquisition is made by a regulated energy company or a non-EU or non-EEA resident company, the Ministry for Ecological Transition would be entitled to impose conditions, provided that the NCMC believes there is a real and sufficiently serious threat to the security of the supply of electricity, gas or hydrocarbons within the scope of the activities undertaken by the acquirer.

Apart from this, the acquisition of holdings in the market operators (i.e., Operador del Mercado Ibérico de Energía, Polo Español, Red Eléctrica de España, Enagás GTS and Compañía Logística de Hidrocarburos CLH) beyond a certain threshold is restricted, regardless of the nationality of the acquirer.

Finally, Spanish regulations provide that individuals or entities that participate, directly or indirectly, in more than 3 per cent of the share capital of more than one principal operator (a utility company that is one of the five companies with higher market value in the relevant sector) in the same energy market or industry among those specified in the above-mentioned provision (including power generation and electricity supply, and natural gas production and supply), may not exercise their voting rights in excess of the 3 per cent threshold or appoint any directors, without prior authorisation from the NCMC.


Investments carried out by either local or foreign investors in certain financial entities, such as credit entities, insurance or reinsurance companies and investment services entities, must follow an authorisation or non-opposition process before the European Central Bank (through the Bank of Spain), the General Directorate of Insurance and Pension Funds or the CNMV respectively.

The general threshold requiring the prior authorisation of these public regulators is 10 per cent or more of the voting rights, or a percentage that, although lower than 10 per cent, allows the exertion of a significant influence in the relevant entity.

Finally, the CNMV must also authorise the acquisition of a direct or indirect holding in Bolsas y Mercados Españoles (the holding of the Spanish stock exchanges) representing 1, 5, 10, 15, 20, 25, 33, 40 or 50 per cent of the voting rights, or a percentage that, despite being lower than 1 per cent, allows the exertion of a significant influence in the company.