What does the “Ley de Startups” consist of?

The "Ley de Fomento del Ecosistema de las Empresas Emergentes", better known as "Ley de Startups", was passed on 1 December with the aim of facilitating the creation and growth of startups. In addition, the law includes criteria that will determine which startups will be eligible for support measures. This includes companies dedicated to science and technology, as well as those that are innovative in terms of processes, products and services. 

In this sense, the law promotes investment in innovation, boosts public instruments, and reinforces collaboration between agents to support the growth of emerging companies. Do you want to know more details? We tell you about them below. 

What are the main objectives of the law? 

The main objectives of the law include: 

1. Encourage the creation and growth of emerging companies in Spain: especially micro, small and medium-sized enterprises, favouring their capacity for internationalisation. 

2. Attracting international talent and capital: with the aim of developing the Spanish start-up ecosystem. 

3. Stimulate public and private investment in start-ups. 

4. Improve the relationship between companies, financing agents and territories: paying special attention to promoting the attraction of start-ups in rural environments (especially in less populated areas). 

5. Boost innovative public procurement with start-ups. 

6. Promote participatory monitoring of the evolution of the Spanish start-up ecosystem. 

To whom is this new law addressed? 

As its name suggests, this law is aimed at companies categorised as "startups". The regulation establishes the following requirements for a company to be categorised as a startup: 

• Not older than 5 years (or 7 for strategic sectors). 

• It is not listed on the stock exchange and does not distribute dividends. 

• The head office or registered office is permanently established in Spain. 

• 60% of the workforce must be employed in Spain.  

• Accumulate a maximum turnover of 10 million euros. 

In addition to these requirements, companies must also prove that they have an "innovative character", understood as the development of new or improved products or services. 

With the aim of assessing the degree of innovation of companies, the Empresa Nacional de Innovación Sociedad Anónima (ENISA) has collaborated in the creation of an evaluation criterion. To this end, ENISA has incorporated the following lines: "degree of innovation", "degree of market attractiveness", "life stage of the company", "business model-scalability", "competition" and "volume of customers". 

What are the principal measures of the Ley de Startups? 

In order to meet the above-mentioned objectives, the new law incorporates the following measures: 

1. Reduction of the tax rate on corporate income tax and non-resident income tax: from the general rate of 25% to 15% in the first four years after the tax base starts to be positive.  

2. Increase in the amount of the exemption from taxation of stock options: from 12,000 to 50,000 euros per year for start-ups of shares or participations derived from the exercise of call options. 

3. Increase in the maximum deduction base for investment in new or recently created companies: from 60,000 to 100,000 euros per year, as well as the deduction rate, which increases from 30% to 50%. 

4. Increase in the period considered as "recent creation": the period in which it is considered to be recent creation increases from 3 to 5 years, in general, or to 7 for companies in certain sectors. 

Since the beginning of the year, this new law supporting the growth of startups has been in force. However, the government still has to approve the following measure:  

• By 24 June 2023, the Council of Ministers will approve a royal decree regulating the functioning of the National Forum for Startups. 

Now you know all the news about the new Ley de Startups and what impact it will have on your business. If you want to stay informed, feel free to visit our resources section!