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The Spanish company in formation exists from the moment when the members decide to form the company until the company is registered in the Mercantile Register.
The Spanish Capital Companies Law of 02/07/2010 regulates the company in formation by Articles 36 to 38, which establish the following:
- Regarding the responsibility of those who have exercised their functions, Article 36 of the Spanish Capital Companies Law establishes that contracts and acts carried out in the name of the company prior to the company’s registration in the Mercantile Register shall be jointly and severally liable they would have celebrated them, unless their effectiveness had been conditioned on registration and later responsibility of the same by the society.
- As to the responsibility of the company in formation, Article 37 establishes that the contracts and acts that are necessary for the registration of the company, which have been made by the administrators, fulfil the faculties that grant them the writing for the pre-registration phase, as well as those contemplated by a specific mandate by the persons designated for this purpose by the partners, assume the responsibility for the company in formation with the assets that it has.
The partners are personally responsible in this case to the limit of what they would have been forced to contribute.
Unless the articles of incorporation or the public deed provides otherwise, if the date of commencement of the commercial activity coincides with the granting of the founding deed, then the administrators will have the faculty for the full development of the corporate purpose and to carry out all contracts and acts.
- Regarding the liability of the registered company, Article 38 establishes that once the company is fully registered, it is bound by the contracts and acts referred to in the previous paragraph, as well as by those it accepts within three months of its registration. In both cases, the joint liability of the partners, representatives, and administrators will cease.If the value of the social capital, having been added to the expenses necessary for the registration of the company, is less than the amount of the capital, the partners are responsible for covering the difference.
The company in formation ends when the company is registered in the Mercantile Registry, but there is no unanimity regarding when the company in formation begins:
- A small sector of the doctrine argues that the regime of Articles 36 to 38 would also apply before granting the public deed.
- On the other hand, a majority group of the doctrine asserts that the society in formation begins with the public deed of constitution.