Law 18/2022, of September 28, on the creation and growth of companies, known as the Create and Grow Law, has been published in the Boletín Oficial del Estado (BOE).

Through this law, a series of measures are introduced that facilitate the creation of companies, combat commercial delinquency and reduce obstacles to the expansion of the business of SMEs (Pymes).

The main measures are:

1.- Speed up the creation of companies

Asimismo, en el marco del impulso a la digitalización, se promueve la creación de empresas de forma telemática a través del Centro de Información y Red de Creación de Empresas (CIRCE), lo que permitirá reducir los tiempos de constitución y los costes registrales y notariales.

It establishes the possibility of creating a Limited Responsibility Company (Sociedad de Responsabilidad Limitada) with a share capital of just one euro, eliminating the legal minimum of 3,000 euros, and reforms are introduced to facilitate the establishment of companies quickly, agilely and electronically through the Information and Business Creation Network.

This measure will mean a reduction in the cost of creating companies, which will promote the creation of new businesses, allow the freed-up resources to be used for alternative uses, aligning Spanish regulations with those of countries with more favorable regimes for entrepreneurship.

Likewise, within the framework of the drive for digitization, it promotes the creation of companies telematically through the Information Center and Network for the Creation of Companies (CIRCE), which will allow the reduction of constitution times and registration and notarial costs.

2.- Measures to combat late payments

The regulation includes measures to advance in the fight against late payments in commercial operations, which is one of the main causes of the liquidity and profitability problems of many Spanish companies, especially SMEs.

As a fundamental measure, the law promotes the adoption of electronic invoicing, modifying the current regulations and expanding the obligation to issue and send electronic invoices to all companies and freelancers in their commercial relations, which will guarantee greater traceability and control of payments between them. This measure will allow reliable and agile information to be obtained in order to know the actual payment terms, an essential requirement to be able to reduce late payments effectively.

Incentives are also incorporated for the reduction of the average payment periods, both through their assessment in the access to public subsidies, and through the reinforcement of public contracting regulations to guarantee that the successful bidders pay the price agreed the subcontractors on time.

Finally, a National Delinquency Observatory will be created, which will be in charge of the monitoring and evolution of payment data and the promotion of good practices in this area.

3.- Apoyo financiero al crecimiento empresarial

The standard incorporates measures to improve financing instruments for business growth that are alternatives to bank financing, such as crowdfunding or participatory financing, collective investment and venture capital.

In the field of crowdfunding, the Create and Grow Law adapts national regulations to European regulations, introducing more flexibility for these platforms to provide their services in Europe. In addition, the protection of investors is reinforced and allows the creation of vehicles to group investors. To expand the universe of eligible business projects, the thresholds of the amounts allowed per financed project and per investor are raised.

A set of modifications are included to boost the venture capital industry, expanding the type of companies in which these entities can invest, including financial companies with a high technological component.

Finally, the recognized figures for closed-end funds are expanded, including structures with extensive experience in other neighboring countries. These are debt funds that can invest in loans, invoices or commercial paper, contributing to and improving the business financing of companies whose financial structure has deteriorated as a result of the pandemic.

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