Spain's Golden Visa for British, it's retroactive!

Raymundo Larraín Nesbitt, February, 18. 2021

Solicitor Raymond Nesbitt gives us an overview of the advantages offered by Spain’s Golden Visa scheme to UK nationals.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
21st of February 2021

Introduction

We recently published an article on Golden Visas for British nationals which has garnered much attention. It constitutes a legal breakthrough, as it allows Britons – for the first time ever – to access Golden Visas in Spain. Since then, we have received numerous queries raising a number of questions. Chiefly, the most important one being on whether Golden Visas are in fact retroactive, or not. The good news is that yes, Golden Visas are indeed retroactive.

Any UK national who bought a property in Spain, on or after the 28th of September 2013, may qualify to apply for a Spanish Golden Visa.

We are going to reproduce below some of the most frequently asked questions raised by UK nationals we’ve collated over the last week to help shed some light on the matter.

  1. I’m British and bought a 500k property in 2016, do I qualify?

Yes, you do.

  1. We bought a 500k property under joint names, do we qualify?

No, you do not. British couples normally buy property under joint names; however, when it comes to Golden Visas, this is a challenge.

The law requires that 500,000 euros are only under the name of the main investor, the balance however can be registered under the name of the partner.

E.g. A UK couple buy under joint names a 500,000 euros property in 2014. They would not qualify because the do not meet the 500k threshold (as each one has ‘only’ 250k).

E.g. A UK couple buy a 700k property, 500k under the name of the wife and the balance (200k) is under the name of her spouse. They would qualify.

  1. We’ve already bought property in Spain but fall just short of the 500k threshold. Do we qualify?

No, but you may still qualify providing you buy another property that assists you reaching the 500k limit. It doesn’t matter if you buy the second property years later, don’t worry. What matters is reaching the 500k goal, even if by combining all the property values you own.

For example, you’ve already acquired a 450k property in the past. What you can do is buy one, or more, properties, to help you reach the 500k threshold, so you qualify for this special residency visa permit.

  1. I snagged a bargain property for under 500k during Spain’s downturn in 2014, but it is now worth substantially more than 500k, do I qualify?

No, you don’t. Same as in point three above, the value in the purchase deed needs to tally 500k. Any capital appreciation over time is not computed, sorry. You would need to buy one, or more, additional properties that allow you to meet the 500k threshold.

  1. We bought a property for 480k in the past but have made extensive improvements to the property since that now make it worth well over 500k. Do we qualify?

No, you don’t. Same as in points three and four above, the values in the purchase deed need to tally 500k. Any extensions or improvements made to a property are not computed. You would need to buy one, or more, properties that allow you to meet the 500k threshold i.e. a parking space.

  1. At present, our property, which cost €795K, is held equally between my wife and myself.  However, if we reorganised our affairs such that my wife, say, held a €500K, interest in the property, could we, again, in principle, be both eligible for a Golden Visa?

No. You cannot belatedly rearrange property holdings to meet the 500k threshold post-sale. The law requires an investor buys one, or more, properties that combinedly meet the statutory threshold. The Title deed/s need to add up to 500,000 euros on buying property in Spain. To overcome this, you could buy a second additional property for 102,500 euros that would allow either one of you to hit the required 500k yardstick.

  1. If I attain a Golden Visa, does the time spent in Spain count towards the Schengen 90/180 rule? I travel to Europe on business regularly and this is a key point for me.

Short answer is no. When you land a GV, you may come and go as you please from Spain; you are not subject to the 90/180 rule that applies to the remainder of UK nationals. Regarding travelling in or around the Schengen Area, the time you spend in Spain would not count towards the 90 out of every rolling six-month period (the 90/180 rule you mention). In other words, as an example, within the same six-month period you may legally flaunt said rule on spending say 90 days in Spain and 90 days in the Schengen Area. Without a Golden Visa you simply could not hope to achieve this. Which is yet another advantage for businesspeople, or for those who simply like to roam free around Europe getting lost in its beauty.

  1. I sold a property and hold a substantial bank deposit since 2015, do I qualify?

Yes, you do. Providing your bank balance is one million euros.

Buying property in Spain is one of many ways to acquire a Golden Visa, albeit it is by no means the only one. There are several other viable options that enable an investor, and his family, to attain a Golden Visa in Spain. Speak to us.

At Larrain Nesbitt Abogados, we have assisted hundreds of non-EU investors, and their families, to attain a Golden Visa since its inception in 2013. We can put you in touch with the most reputable real estate agencies across Spain to make your dreams come true. Apply for the keys to your Golden Visa through Larraín Nesbitt Abogados’: Golden Visa Service.

Interested? Come and speak to Larraín Nesbitt Abogados friendly staff who will be pleased to guide you through Spain’s Golden Visa programme. Your family’s success is only one call away: (+34) 952 19 22 88.

LNA has a 100% track record attaining Spanish residency

Larraín Nesbitt Lawyers, small on fees, big on service.

Golden Visa Service

 

Residency services available from LNA

 

Golden Visa related articles

 

Article also published at Spanish Property Insight: Spanish Golden Visa for British, it’s retroactive!

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Voluntas omnia vincit.

2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

 

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Spanish Golden Visa for British investors after Brexit

Raymundo Larraín Nesbitt, January, 21. 2021

Solicitor Raymond Nesbitt gives us an overview of the advantages offered by Spain’s Golden Visa scheme to UK nationals.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2013, 2017, 2018, 2019, and 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
21st of January 2021 

Introduction

The Spanish Golden Visa has become the gateway to Europe for thousands of applicants pursuing the European dream. They have collectively invested over 2 billion euros since its inception in 2013. Although Spain’s visa programme was initially a flop, as it fell well below expectations, and was marred with teething issues, an ambitious overhaul in 2015 made it extremely competitive compared with similar schemes offered by fellow EU countries. So much so, that this massive tweak enabled Spain to confidently overtake Portugal, becoming Europe´s leading Golden Visa supplier.

Although this procedure was originally devised to cater to affluent Russian, Chinese, and Iranian nationals, in a post-Brexit world, UK nationals now have a golden opportunity (excuse the pun) to benefit from the wide array of advantages offered by Spain’s Golden Visa scheme. 

With the European Union’s Parliament official confirmation from last week that it will ratify belatedly the Withdrawal Agreement in February 2021, Brexit is now truly done and dusted. This opens the doors for Britons to apply for a GV application. Although Brexit has been a protracted procedure, as a positive note, it has allowed the prospect of Golden Visas for British nationals.

UK nationals may now enjoy - for the first time ever - the slew of advantages that were until now reserved only to a select minority of wealthy non-EUs. The main advantage is that it allows British nationals - that lack a EU passport - to enter and move visa-free through the Schengen Area, skipping pesky passport controls on an equal footing to EU nationals. Much like before the UK voted to break away from the Union.

If you fancy an in-depth take into this subject, you can take a peek at our 2013 article: Investor Guide to Spain’s Golden Visa Law

Spain’s Golden Visa programme allows affluent non-EU applicants, and their dependants, unfettered access across Europe´s Schengen Area. Travel unmolested through all of Europe.

A Golden Visa enables you, and your family, to live and work in Spain (Europe). This visa guarantees Spanish residency, which eventually leads to Spanish citizenship (optional). Live the dream, apply now!

Thousands of non-EU nationals have already secured their families’ future and well-being on benefiting from this special arrangement that rolls out the red carpet cutting through all the red tape. Spain’s Golden Visa is a success story, be a part of it!

At Larrain Nesbitt Abogados, we have assisted hundreds of investors, and their families, to attain a GV since its inception in 2013. We can put you in touch with the most reputable real estate agencies across Spain to make your dreams come true. Apply for the keys to your Golden Visa through Larraín Nesbitt Abogados: Golden Visa Service. Your family’s success is only one call away: (+34) 952 19 22 88.

 

Golden Visa Advantages

  • Fast-tracked. This law is specifically devised to attract affluent non-EU investors and helps to cut through the admin red tape greatly streamlining the visa procedure.
  • Travel Europe visa-free. You can travel without a visa for 90 days out of every 180 days within the Schengen Area.
  • Clear rules. Two years (Residency Permit), renewable for a further 5 years.
  • No need to become resident in Spain. You only have to visit Spain once to get or renew the Residency Permit. There is no minimum stay requirement, and you don’t have to become a tax resident or actually live in Spain.
  • Family included. You may get additional permits for your spouse and children under 18 years (or disabled and dependant children over 18). Same-sex partners inclusive. Dependant parents of applicant are now also included (extended family).
  • You may work in Spain.
  • Spanish nationality (optional). This is a 2-year Residency Permit, not the right to permanent residency or a Spanish passport. However, it can lead to long-term Spanish residency after 5 years of continuous residence, and citizenship after 10 years.
  • Underaged children may study in Europe. Underaged offspring can live and study in Europe, in company of your partner, whilst you work and earn money abroad.
  • Return on investment. Take advantage of Spain´s burgeoning real estate recovery.

 

General Requirements

 Applicants pursuing investor visas must comply with the following general requirements:

  • Non-EU national.
  • The investor applicant must be of legal age (18-years-old or over).
  • The investor must not hold a criminal record whether in Spain or in the previous five years where he has resided.
  • Not be already in Spain irregularly.
  • Have access to private medical insurance.
  • Have sufficient financial means to support both himself and his family whilst in Spain.
  • Pay the relevant application fee.

 

Specific Requirements

Qualified residency permits to non-EU residents will be offered in return for any of the following:

  1. Invest at least €500,000 in Spanish real estate property.
  2. Invest at least €2,000,000 in Spanish Treasury Bonds.
  3. Invest at least €1,000,000 in shares of Spanish companies.
  4. Deposit at least €1,000,000 in Spanish bank accounts.
  5. A ‘major’ business investment which fulfils at least one of the following three criteria:
  • Meaningful job creation as a direct result of the investment.
  • Significant socioeconomic impact in the geographical location where the activity will be carried out.
  • Technological or scientific impact.

Why choose Europe?

  • Democracy. Europe, cradle of democracy, hosts some of the world’s oldest and most solid. A clear and stable legal and tax framework allows freedom, nurtures ingenuity, and upholds (property) rights for businesspeople. This concocts the ideal breeding ground to foster business investments, and develop an entrepreneurial skill set.
  • Education. Europe is home to some of the world’s most respected academic institutions. Secure a bright future for your children allowing them to earn their spurs in life through a meritocratic top-notch education.
  • Culture. Europe is a crucible of cultures, a conflux that laces Western and Eastern influences, offering a rich tapestry of history and arts that shaped the world as we know it. Spain’s vast cultural heritage, spanning millennia, is a legacy of commingled cultures that attracts over 84 million tourists every year leaving an indelible mark upon its visitors.
  • Languages. Seize the opportunity to master and command some of the world’s most influential languages: English (business & finance), French (arts & diplomacy), German (industry & science), Spanish (literature & poetry).
  • Healthcare. Europe, and Spain in particular, are at the forefront in modern medical facilities.
  • Modern transport. Spain offers top-tier transport services including state-of-the-art high-speed rails connecting you with Europe’s major capitals.

 

Frequently asked questions

 


   1. Can I request a mortgage on investing €500,000 in Spanish real estate?

Only on the excess above €500,000. The law requires that the first €500,000 is unencumbered – meaning the equity threshold must be free. The excess can indeed be financed through a mortgage loan if necessary. Notwithstanding the above, you may also finance the 500k using a lender, as long as he is located outside of the Union, although this may prove challenging in practice.

   2. I have read that I need to spend over six months in Spain to qualify for residency. Is this true?

No. A GV neatly overrides this requirement. This law specifically targets affluent individuals who will normally be residing and working elsewhere. That doesn’t preclude the investor’s spouse and children from living and studying (or even working) in Spain (Europe). In other words, you are free to come and go as you please without needing to stay in Spain a minimum period of time every year.

   3. I don’t fancy paying taxes in Spain, I already pay enough in my home country. Will I become a Spanish tax resident if I apply for a GV?

No, you won’t. A GV application is unrelated to your tax residency. Only if you spend more than 183 days a year in Spanish territory would you become a Spanish tax resident. Ideal for those who want their families to enjoy a European lifestyle whilst the main investor commutes to work in other countries and has his/her main business outside of Europe.

   4. How long does it take to attain a GV application?

Under two months, on average.

   5. Can I work in Spain?

Yes. Following a change in the GV law in 2015, the main investor may now work in Spain.

   6. Can I make use of the public healthcare system?

No. This blue-ribbon visa targets wealthy non-residents who must hire their own private insurance. We can also assist you with this: Hiring private health insurance.

   7. Does a GV include also the investor’s family?

Yes, even extended family. The term ‘family’ must be understood broadly. A married couple and their children under 18 are included under the same application as a family unit. Same-sex partners qualify as a married couple. In some cases, children over 18 y.o. are also included as long as they are financially dependent. Also, dependant parents, even if under 65 y.o.

   8. How long does the Golden Visa last for?

Two years, and you may renew it for a further 5 years.

   9. Do holders of the so-called Golden Visa have unrestricted access to move within the European Union?

In a nutshell, yes. Holders of a Spanish Golden Visa do not require a visa to enter Europe’s Schengen Area. They can transit and enjoy free movement within the Schengen Area visa-free for a maximum period of three months (90 days) in every rolling six-month period from the date of first entry. You will have unfettered access to move within the Union.

  10. Can I invest in real estate through a company?

Yes, but certain criteria apply to qualify - talk to us. The bottom line is that you can indeed buy real estate through companies and still qualify to attain a GV in Spain.

Interested? Come and speak to Larraín Nesbitt Abogados friendly staff who will be pleased to guide you through Spain’s Golden Visa programme. Your family’s success is only one call away: (+34) 952 19 22 88.
 

Golden Visa Service *

*includes one family unit

 

“Democracy owes its existence to Christianity.” – Robert Schuman

Jean-Baptiste Nicolas Robert Schuman (1886 – 1963). Was a French statesman. Schuman was a Christian Democrat (Popular Republican Movement) political thinker and activist. Twice Prime Minister of France, a reformist Minister of Finance and a Foreign Minister, he was instrumental in building postwar European and trans-Atlantic institutions and was one of eleven Founding Fathers of the European Union, the Council of Europe, and NATO.

In fact, all Founding Fathers of the Union were Christian, which explains the thoughtful choice of Rome - Christianity's bedrock - to sign in 1957 the EEC’s foundational treaty, a forerunner of what in time would be known to us as the European Union, or Union. I’m guessing Pericles would like to have a word or two on this quote.

LNA has a 100% track record attaining Spanish residency

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, residency, inheritance, taxation and litigation. You can contact us by e-mail at info@larrainnesbitt.com, by completing our contact form or by telephone on (+34) 952 19 22 88.

Residency services available from LNA:

 

Golden Visa related articles

 

Article originally published at Spanish Property Insight: Spanish Golden Visa for British investors after Brexit

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Voluntas omnia vincit.

2.013, 2.017, 2.018, 2.019, and 2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Do you need an updated NIE certificate to sell property in Spain?

Raymundo Larraín Nesbitt, December, 1. 2020

Marbella-based Larraín Nesbitt Abogados (LNA) has over 17 years' taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2020. Plagiarism will be criminally prosecuted.

 

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8th of December 2020

We published several years ago (in eight languages) a detailed article explaining what a NIE number is and how to go about getting one. A NIE number is assigned by the national police and is yours for the remainder of your lifetime, it never changes. Many years ago, Spanish police issued them as an A4 sized certificate that had a three-month expiry date printed on them. Modern-issued NIE numbers no longer show ‘expiry’ dates.

At times notaries, on selling, demand a seller procures a new updated NIE number certificate. This is because they have seen the 3-month expiry date is (long) overdue and are asking for a ‘new’ updated copy. In truth, the ‘new’ certificate will bear exactly the same number and details as the former, the only difference is that there will not be any expiry date on it.

Imagine sitting the morning of completion at a notary’s office, surrounded by a group of anxious strangers, and feeling a knot at the pit of your stomach when the notary officer informs you the sale has fallen through because your NIE number is not accepted by the notary! Now imagine millions of euros are at stake. It can well happen. The sale needs to be postponed or else change over to another notary (not always possible when mortgage loans are involved, as is often the case).

Then again, some notaries, who are not prone to nit-picking, will have no qualms accepting an ‘expired’ NIE number certificate. They will find it completely unnecessary to re-apply for a new copy and are more than happy to accept an old one which shows a 3-month expiry date.

The problem is that sellers cannot pick the notary witnessing a sales deed. This is a right that belongs only to buyers, who are legally entitled to pick whichever notary pleases them most. One of the many disadvantages this poses to sellers, is that they are unable to know beforehand - often until it is too late in the day - which notary will be the one selected by the buyer. Meaning they cannot know if the selected notary will demand they update their old NIE number certificate, or not, on selling.

This can be easily pre-empted by your appointed conveyance lawyer on including a clause in the POA to attain a duplicate NIE number should the need arise on selling. Bottom line, in practice it’s a bit akin to playing Russian roulette; a seller cannot know for sure if the chosen notary will demand an updated NIE certificate, or not. It is the duty of your conveyance lawyer to plan ahead for this eventuality and overcome any unforeseen obstacle.

Politicians were mostly people who'd had too little morals and ethics to stay lawyers.” George R.R. Martin

George Raymond Richard Martin (1948). Is an American novelist and short-story writer in the fantasy, horror, and science fiction genres. He is best known for his international bestselling series of epic fantasy novels, A Song of Ice and Fire, which was later adapted into the HBO dramatic series Game of Thrones.

 

At Larrain Nesbitt Abogados we have over 17 years’ experience assisting clients buying & selling property in Spain and dealing with its taxation.

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, taxation, inheritance, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

Legal services available from Larraín Nesbitt Abogados

Selling-related articles

 

Article originally published at Spanish Property Insight (SPI): Do you need an updated NIE certificate to sell property in Spain?

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely on websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. No dragons, Lannisters or self-serving politicians were harmed on writing this article. VOV.

2.020 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Home-Seller’s Checklist

Raymundo Larraín Nesbitt, May, 1. 2020

Lawyer Raymundo Larraín gives us a rundown on the points we should have ready on selling a house in Spain. This is the third, and final, of a three-part series on buying & selling property in Spain. Previous entries:

 

Marbella-based Larraín Nesbitt Lawyers has over 17 years' taxation & conveyancing experience at your service. We offer a wide range of 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2018, 2020. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8th of May 2020

 

Congratulations, you have found a buyer for your Spanish property! You should now instruct a lawyer to represent you in the sale, particularly if you are non-resident in Spain.

To secure the deal, your appointed lawyer will require from you a long list of documents you should have ready at hand. These documents will then be forwarded to the buyer, or his legal representative, as they are necessary to prepare a due diligence.

Following this, the next step would be exchanges; to sign the all-important Private Purchase Contract (contrato privado de compraventa, in Spanish). At times, buyer’s & seller’s skip this key step and go straight to completion, but in my opinion, this is unadvisable for reasons I won’t go into.

The below list is thought only for non-resident sellers acting as physical persons. If the seller is a holding company, there would be additional documents that need to be handed over to a buyer, or his representative.

Selling property may at times prove a daunting and stressful ordeal for sellers; to save yourself aggravation and time it is most advisable a seller pre-empts this by collating the below list well ahead of time.

You are welcome.

Seller’s checklist

 

  • Full scanned copy of your purchase Title Deed
  • (Updated) scanned copy of a Nota Simple
  • Copies of your national ID, passport and NIE Number certificate (in force). A duplicate NIE certificate is at times demanded by notaries if your certificate already expired i.e. 3-month validity (the assigned number never changes)
  • Copy of recent utility invoices (water & electricity)
  • Copy of IBI tax invoices, for the previous 4 years
  • Copy of Refuse Charge (Basura, in Spanish), for the previous 4 years
  • Energy Performance Certificate
  • Licence of First Occupation
  • Community of Owner’s administrator contact details
  • Scanned copies of the minutes of the last three General Assemblies (Junta General Ordinaria, in Spanish)
  • Community of Owner’s Certificate stating the property being sold is not in arrears
  • Spanish fiscal residency certificate (to avoid a 3% retention on the sales proceeds)
  • Copy of Power of Attorney, if instructing a lawyer (it is highly advised that you do to avoid payment scams at completion, which are rife)
  • If renting out, copy of the signed lease agreement

 

Capital gains tax mitigation checklist

 

On hiring our law firm, we can GREATLY mitigate your tax bill on selling property. We can offset all the following taxes and fees at no extra cost:

  • Lawyer’s fees (on buying).
  • Notary fees (on buying).
  • Land Registry fees (on buying).
  • Taxes (on buying) yes, these can be offset in full on selling – you are welcome.
  • All property-related improvements (not maintenance costs) i.e. glass curtains, refitted kitchen, roof retiling, wood flooring, A/C installation, house alarm etc.
  • Estate agent's commission (on selling): VAT invoice/s.
  • Lawyer’s fees (on selling): VAT invoice.

 

3% tax rebate on selling property in Spain

 

To close, free of charge, we also apply for a tax rebate on the 3% withheld by the Spanish Tax Authorities on account of a non-resident seller’s CGT liability. This is taking 5 months on average through us.

Selling at a loss?

 

If you’re selling at a loss, we can apply for a full tax refund of your plusvalia tax for a very competitive fee. More on this service in our article: Have you sold property at a loss in Spain? You can now apply for a tax refund. In general, you only have 30 days as from the date of sale to apply for this tax rebate.

Sounds interesting? Call us.

 

At Larrain Nesbitt Abogados we have over 17 years’ experience assisting clients buying & selling property in Spain and dealing with its taxation.

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, taxation, inheritance, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

Legal services available from Larraín Nesbitt Lawyers

 

Selling-related articles

 

Article also published at Spanish Property Insight: Home-Seller’s Checklist

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.018, 2.020 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Home-Buyer’s Checklist - RESALE

Raymundo Larraín Nesbitt, April, 10. 2020

Lawyer Raymundo Larraín gives us an overview on the points we should cover on buying a resale in Spain. This is the second of a three-part series on buying & selling property in Spain.

Marbella-based Larraín Nesbitt Lawyers has over 17 years' taxation & conveyancing experience at your service. We offer a wide range of 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2020. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8th of April 2020

 

You have fallen in love with a property in Spain and now it’s time to take the dip and sign the contract!

This short article is written with the aim to provide a buyer with a basic guideline on what you should be asking a seller for. It is not meant to substitute professional legal advice.

Whilst it is possible to buy a property in some overseas jurisdictions, including Spain, without having to appoint a lawyer, it would be very unwise to do so. Buying a house is one of the biggest investments most people make in their lifetime. So why take the risk by not obtaining proper legal advice?

Banks and notaries are not your own personal lawyers and will not carry out stringent legal checks to protect buyer’s legal interests; that is not their job. This is a common blunder buyers’ make, particularly non-resident ones.

Instruct your own independent lawyer and never under-declare; besides being illegal, you will pay a massive Capital Gains Tax bill on selling it later on. It is illegal, it is stupid and only benefits the seller, not the buyer.

Remember to store safely the following invoices on buying which can be used to GREATLY mitigate your tax bill on selling:

  • Lawyer’s fees (on buying).
  • Notary fees (on buying).
  • Land Registry fees (on buying).
  • Taxes (on buying) yes, these can be offset in full on selling – you are welcome.

 

 

Buying Resale Checklist

 

Please note I only have in mind physical individuals acting as sellers on writing this rundown, if companies are involved, then far more checks would be necessary.

  • Request a copy of a seller’s Title deed.
  • Request a copy of a Licence of First Occupation, where possible. This is required for holiday rentals and also by lenders to raise finance against a property (i.e. to buy the property itself, or because you need money to pay health-related expenses later on in life, etc).
  • Ensure the person/s you are dealing with as sellers are the ones registered as the property owners. If not, ensure they are acting through a valid Power of Attorney.
  • Request an updated nota simple, or else procure yourself one.
  • Ensure the property is classified legally as a dwelling and not as commercial property.
  • Ensure the property is freehold, not leasehold.
  • Verify the property is not in arrears with its Community of Owners, if applicable. A buyer becomes liable for the previous 3 years in arrears plus the current one (total 4 years).
  • Verify there are no outstanding local rates to be paid: IBI and refuse charge (basura, in Spanish). A buyer becomes liable for the previous 4 years.
  • Verify there are no tenants living in the property. Under new stringent rental laws tenants at times are legally entitled to stay 8 or 10 years in a property, even if sold on! The buyer must respect the duration of the whole rental contract, unless a tenant formally agrees to leave ahead in exchange of ‘compensation.’
  • Ensure the property is unencumbered (no mortgage against it).
  • Ensure the property is free of liens i.e. rights of way, rights of view, hunting rights, gathering rights, well rights
  • Ensure the property is free of charges i.e. no registered embargoes against it.
  • If investing in a Buy-to-Let, verify your Community of Owners has not banned or restricted holiday rentals.
  • If investing in a Buy-to-Let, ensure you are compliant with holiday homes regional regulations and attain a Tourist licence to rent where necessary - seek legal counsel.
  • Post-completion: arrange payment of local rates (IBI & basura) as a direct debit against your Spanish bank account.
  • Post-completion: if you are non-resident, ensure you pay every year your Non-Resident Imputed Income Tax (NRIIT) on your Spanish property.

 

 

 

" We human beings become what we dream as children and during our youth.” Manuel Patarroyo

Manuel Elkin Patarroyo (1946, Colombia). Is a Professor of Pathology and Immunology who developed, under precarious third-world conditions, the world's first synthetic vaccine against a severe strain of malaria, a disease which kills 1.5 million people per year. The man was offered a fortune by leading US Pharmaceuticals for his patent (rumoured at over 1bn US Dollars). Anyone would have accepted such a generous offer; anyone but him. He altruistically donated his patent to Humankind, and as a result the prices charged for his vaccine are ultra-low, because anyone can mass produce it without having to pay royalties brutally reducing the cost of development. It is estimated his work saves two million lives every year. Much like his childhood hero, the much-acclaimed French microbiologist Mr. Louis Pasteur, he too would grow up to become a real-life hero.

Our world needs more people like Mr. Patarroyo.

 

At Larrain Nesbitt Abogados we can assist you buying & selling property in Spain and deal with its taxation. Ask us.

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

 

Resale-related articles

 

Article originally published at Spanish Property Insight: Home-Buyer’s Checklist: RESALE

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.020 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Home-Buyer’s Checklist - OFFPLAN

Raymundo Larraín Nesbitt, March, 1. 2020

Lawyer Raymundo Larraín gives us an overview on the points we should cover on buying off-plan in Spain. This is the first of a three-part series on buying & selling property in Spain.

Marbella-based Larraín Nesbitt Lawyers has over 17 years' taxation & conveyancing experience at your service. We offer a wide range of 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2020. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
1st of March 2020

You have fallen in love with a property in Spain and now it’s time to take the dip and sign the contract!

This short article is written with the aim to provide a buyer with a basic guideline on what you should be asking a developer for.

Whilst it is possible to buy a property in some overseas jurisdictions, including Spain, without having to appoint a lawyer, it would be very unwise to do so. Buying a house is one of the biggest investments most people make in their lifetime. So why take the risk by not obtaining proper legal advice?

Banks and notaries are not your own personal lawyers and will not carry out stringent legal checks to protect buyer’s legal interests; that is not their job. This is a common blunder buyers’ make, particularly non-resident ones.

Instruct your own independent lawyer and never under-declare; besides being illegal, you will pay a massive Capital Gains Tax bill on selling. It is illegal, it is stupid and only benefits the seller, not the buyer.

Remember to store safely the following invoices on buying which can be used to GREATLY mitigate your tax bill on selling:

  • Lawyer’s fees (on buying).
  • Notary fees (on buying).
  • Land Registry fees (on buying).
  • Taxes (on buying) yes, these can be offset in full on selling
  • All property-related improvements (not maintenance costs). Providing you have VAT invoices to back them up. You are welcome.

 

Buying Off-Plan Checklist

 

  • Verify the plot of land is registered under the developer’s name whose contract you are signing.
  • Request a copy of the developer’s Building licence.
  • Request bank guarantees or insurance policy securing ALL your stage payments, including the initial holding deposit paid to the developer/estate agent. These will act as a safety net safeguarding your interim payments should the developer complete the property late, or not at all.
  • Ensure the development is compliant with Coastal Laws.
  • If the development is finished, request a copy of the Licence of First Occupation.
  • If the development is finished, ensure you do a snagging list before completion.
  • Post-completion: ensure your property is now registered under your name at the Land Registry and never take anyone’s word for it! Verify it yourself.
  • Post-completion: arrange payment of local rates (IBI & basura) as a direct debit against your Spanish bank account. With offplan, IBI is normally available on the following year. You will be notified in your Spanish address.
  • Post-completion: if you are non-resident, ensure you pay every year your Non-Resident Imputed Income Tax (NRIIT) on your Spanish property.

 

“Ring-a-ring o’ roses,
A pocket full of posies,
A-tishoo! A-tishoo!
We all fall down.” – Popular British nursery rhyme that sinks its roots deep in the Middle Ages.

 

At Larrain Nesbitt Abogados we can assist you buying & selling property in Spain and deal with its taxation. Ask us.

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

Off-plan related articles

 

Original article commissioned and published by IDEALISTA: Home-Buyer’s Checklist

Article also published at Spanish Property Insight: Home-Buyer’s Checklist - OFFPLAN

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.020 © Raymundo Larraín Nesbitt. All Rights Reserved.

... Read more

Community of Owners in Spain

Raymundo Larraín Nesbitt, December, 3. 2019

Lawyer Raymundo Larraín explains to us the legal intricacies of community of owners, or comunidad de propietarios in Spanish. Makes for excellent bed reading!

Article dedicated with affection to my friends Ann and Andy H., from Wakefield, West Yorkshire, England.

Marbella-based Larrain Nesbitt Lawyers has over 16 year’s taxation & conveyancing experience at your service. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Article copyrighted © 2.009, 2.012 and 2019. Plagiarism will be criminally prosecuted

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8th of December 2019

Introduction

Now that the season of General Assemblies is fast approaching for Q1 2020, I thought I’d revisit my 2009 article. The following is a revamped version of my decade-old article updating it in line with the new changes in legislation.

Community of Owners is an article which gist is to provide basic guidance on what becoming an owner in a community entails, with particular focus in Andalusia. It is not an in-depth treatise.

General Assemblies, held once or twice a year, are prone to bickering and backstabbing, where every neighbour it would seem has an axe to grind. You’d do well in acquaint yourself with your owner’s duties and rights to better protect your interests; which may not be aligned with others’.

Because this is just a ‘short’ article, I strongly recommend reading the law itself, as I have considerably abridged the sections pursuant to it, on reviewing them, giving only a general overview of its key sections and casting aside any pesky nuances which are only of interest to other lawyers.

This is a link to the Commonhold Act in English as amended by Law 8/99 & others, courtesy of Castillo Traductores. English version starts on page 4. You are welcome.

Definition

On buying property in an urbanisation, or block of flats, you may automatically become a member of what is known as a ‘Community of Owners’, or CO for short. The CO is a legal entity comprised by all the property owners within the same development, or building, and is governed and ruled by its own self-approved statutes and bylaws, besides a national legal framework that acts as common denominator to all CO’s.

General Legal Framework

There is a general legal framework acting nationwide as backbone common to all communities in Spain, as set out by the Commonhold Act 49/60 (AKA Ley de Propiedad Horizontal, Horizontal Property Act, or Commonhold Act) and by the Spanish Civil Code (arts 396 et seq).

The 1960 Law on Horizontal Property was amended most significantly by Law 8/99, amongst others, to bring it line with social changes. It is now a 60-year-old law.

Community Statutes and Bylaws

In addition to the above general laws, the day-to-day running of each community is really determined by the Communities’ Statutes which are drafted at the time of lodging the Master Deed (aka Escritura de División Horizontal or Horizontal Deed). Unanimity is required to amend either the Master Deed or the Community Statutes (arts 5 and 17). So, in practice it’s quite a feat to change either of them. An exception to this unanimity, is a recent legal change on holiday rentals (see section further below).

That’s why a community may, at its own discretion, approve additionally its own Community Rules or Bylaws (in Spanish Normas de Regimen Interno or Normas de Funcionamiento de la Comunidad de Propietarios), which are not to be confused with the above Community Statutes. Community Rules (Bylaws) need only a simple majority vote to be approved and amended so as to waive the unanimity rule. They allow for great flexibility and will rule, for example, on communal services such as garbage collection or the use of communal facilities such as the swimming pool or lifts. They cannot rule on matters reserved only to Community Statutes.

Normally, on buying off-plan, there will be a clause whereby the purchaser allows the developer to draft and lodge the Master Deed as well as the Community Rules (Bylaws) at the Land Registry. Buyers may later on amend these, when they become owners, on complying with the strict majorities that are required by the Commonhold Act (unanimity).

This means that every development may enact their particular laws governing it but always subject to, and in compliance with, the general legal framework that must be respected and adhered to at all times. Bylaws will rule for example the Community’s governing bodies such as the need or not for the optional role of vice-president or how must the owners be notified in advance of an owner’s assembly i.e. think of non-residents being notified abroad of an upcoming General Assembly (AGM or EGM).

Bylaws stem from Spain’s Commonhold Act and adapt it to the requirements of each particular CO. That’s why each CO has its own unique Bylaws, tailored to suit their own individual needs.

Naturally, given the tight space constraints of such a short article (and frankly, not to bore gentle readers to tears), I can only offer a general overview of the shared legal framework and concepts which underpin all communities in Spain without focusing on any particular Bylaw, which are unique to each CO, as I write.

Commonhold Quota

On drawing up the Master Deed before a Notary, every property within a community is assigned a quota or percentage thereof. This quota is composed both of privative and communal elements which are assigned to each property. Storerooms and garage spaces are tallied as well for this purpose.

A commonhold quota is important twofold:

  1. The expenses of a community will be allocated apportioning them to your quota. So, the larger your quota, the more you will have to contribute towards expenses. These can be paid monthly, bi-monthly or even quarterly depending on the Community Rules.
  2. On voting at owners’ assemblies, the quotas need to be tallied for majority vote purposes. So, each owner does not equate to one vote. There may be a single owner, such as a developer or bank, holding a significant communal quota which translates into great voting power. The resolutions reached bind all units within, regardless of whether they cast an opposing vote as majority rules apply (see below).

Owners’ Duties

Section 9 rules them in detail. The main duty will be, of course, to contribute towards the maintenance and financial upkeep of the CO.

Falling in arrears with your community fees will eventually result in your CO placing a lien against your property and may even lead to selling it in a public auction. This legal procedure in Spain works surprisingly efficiently. You have been warned!

This important article mentions the endowment of a community’s mandatory reserve fund, in accordance to each owner’s commonhold quota. The percentage of this endowment has now been raised to 10% of the community’s ordinary budget (used to be 5%). The purpose of this fund is to create a safety net for a rainy day i.e. the maintenance and repair of a building such as lift repair work. This reserve fund shall be endowed with an amount not lower than ten percent of its last ordinary budget. Its funds will be used as well to pay for the building’s insurance cover.

It is also very important to find out – prior to buying a property in an urbanisation – what your contribution is to avoids nasty surprises. Some of those private gated communities that lure you with breathtaking views, 24/7 top-notch security, lush tropical gardens, private gym and dream-like infinity pools command (very) steep monthly fees. This is particularly true of well-off off plan developments (when the community is not up and running yet) where it is not uncommon that unscrupulous salespeople tell you the community fees are X/month and later on it becomes only too apparent they are in fact 3X/month!

Communities’ Governing Bodies

Art 13 establishes the governing bodies are the Owners’ General Assembly (ordinary or extraordinary), the President (vice-presidents are optional), the Secretary and the Administrator. Oftentimes, the role of Secretary is also taken by the community Administrator (paid role).

Presidents and vice-presidents must be appointed from among unit owners only. The roles of Secretary and Administrator can be held by unit owners, as well as by outsiders, providing the latter hold the necessary professional qualifications and are legally licensed to perform such roles.

The Statutes will be the ones which detail exactly what roles exist in each Community of Owners. Presidents, by law, alas do not receive any remuneration for this most ungrateful task.

Following the above, no one in their right mind wants to be President, much less be elected to the same role year after year. A well-known issue is that some community presidents (which officially hold an unpaid role) perpetuate themselves year after year abetted by their web of cronies and do in fact make a very tidy living running whole communities at the expense of pocketing fees from fellow owners on fudging the numbers (specifically fellow gullible non-resident expatriates, bless their warm hearts!). I tell you - by experience - that no one who has held the role of community President wishes to repeat from one year to the next as it is a very ungrateful task that’s almost like a second job. Be wary of community Presidents who hold their position indefinitely and fight tooth and nail to retain power and control. Only on changing administration does the corruption of the former management come into light.

Owners’ Assemblies (AGM’s and EGM’s)

At least once a year an Annual General Meeting (AGM) will be called to approve the community budget and accounts. An Extraordinary General Meeting (EGM) may additionally be called at any time, needing 25% of the unit owners’ quotas.

The notification must be given with a minimum of 3 days’ notice.

This creates serious practical problems to non-residents owning second homes in Spain i.e. you need to book a flight to Spain which may be very expensive with such short notice besides having to take time off your job. Therefore, communities with a high number of non-resident owners may include in their Bylaws more realistic notices of, say, 30 days and to be notified by e-mail in addition to placing it on the Community’s Notice Board. There’s freedom and flexibility to rule on this as each community deems fit in accordance to their own needs and circumstances. Logic should prevail, albeit it seldom does in practice.

Majority and Unanimity Votes

Section 17 deals with when unanimity votes are required. Basically, unanimity is necessary for modifying the rules contained, either within the Master Deed or in the Community’s Bylaws.

A majority vote (three fifths of the owners’ assessed quotas) is required for things such as the lift service, janitors, security services or any other common service or facility. This type of majority vote will be the one used to decide on the Community Rules. Proxy votes are also allowed. Only owners who are up-to-date with their community fees may vote at owners’ assemblies. You are allowed to settle your arrears even on the same day as the General Assembly is being held. However, there are new practical limitations in place to settle arrears in cash. In compliance with new national and EU Anti-Money Laundering Regulations in force, payments in cash in excess of 2,500 euros may be declined. So, if you plan to pop over to the meeting with a wad of banknotes, you may be turned down by the Secretary!

You may find that in new unsold off plan developments, a developer may hold the majority vote as he still holds a large stock of unsold units. Conversely, it can be its lender, if they have taken over the developer’s units (repossession). Either way, both are obliged to contribute to the communities’ upkeep, paying their communal fees in proportion to their communal quotas, just like everyone else.

General Assembly Resolutions

Section 19 deals with the recording of the resolutions reached. They will be recorded in a book of minutes, validated and stamped by the Land Registrar.

A copy of the meeting’s minutes will be sent to each owner with the adopted resolutions following the AGM or EGM. Ideally shortly after the assembly, not several months after when no one can remember what transpired at the meeting.

The Secretary will act as the custodian of the general meetings minutes book.

Any Other Business

If you want to put a concrete matter forward to the Assembly for consideration, you must do so well in advance of being notified by the General Assembly. You cannot simply turn up at the AGM or EGM and expect to nonchalantly raise new issues which were not previously included in the day’s agenda. The President and/or Secretary will simply disallow it and move on with the agenda’s points.

Challenging General Assembly’s Resolutions

Section 18 rules on how assembly resolutions can be challenged at court. I’ve written a specific article on the matter due to its complexity: Community of Owners in Spain: Challenging Assembly Resolutions – 21st October 2011.

This can be done on three accounts:

a) When resolutions are contrary to Law or the Community Statutes;

b) On them being seriously detrimental to the interests of the community and benefit one or several unit owners.

c) When they are seriously detrimental to some unit owner who has no legal obligation to sustain such detriment or when they have been adopted in abuse of power.

There are four deadlines depending on the matter. The most important deadline is the 3-month-rule. Or else a year, if a resolution is against the Law or the Community Statutes. I would always advise challenging a resolution before the three-month deadline is up as a judge may not agree with you that the adopted resolution is against the law or community statutes, in which case you wouldn’t have a year to challenge it, only three months. Pro tip: don’t wait over 3 months to challenge them.

Only owners who are up-to-date with their community fees may challenge community resolutions before a court. Alternatively, they can lodge the owed amounts before a law court prior to litigating. You can only challenge approved assembly resolutions at court, through litigation; sending a strongly-worded letter or e-mail to the President, Secretary or Administrator stating you are in full disagreement with resolution X is a futile exercise. But if that indulges you…

Holiday Rentals

As we reported back in March (Spain's new rental laws in 2019), a new law was approved early on in 2019 which brought a raft of changes, specifically on holiday rentals. If you buy into a gated community or building, chances are high you will become part of what is known as a community of owners. New laws passed on March 2019 have empowered communities of owners across Spain to outright ban, or restrict, holiday rentals. You really do not want to invest several hundred thousand euros in a property only to find out later on you are banned by your community to offer it as holiday accommodation! All changes effective as from 6th of March 2019. General Assemblies (AGMs or EGMs) which adopt restrictive resolutions on holiday rentals should lodge them at their local Land Registry for them to be enforceable.

The main two changes are as follows:

   1. Community of owners may now ban holiday lettings outright

Spain’s Horizontal Act has now been amended allowing Community of Owners to vote by a simple majority of 3/5 (or 60%) to ban outright holiday rentals within a community.

I had already pointed out in a blog post in 2017 that this step was necessary, as the Horizontal Property Act at the time required unanimity to ban them, which logically was never going to happen because landlords would vote against it because of their vested interest.

This change has no retroactive effect. Meaning that if you attained a Tourist licence before your community banned holiday rentals, you can continue doing so. There is an ongoing debate on this point between lawyers, as it is a bit of a grey area until there are further like-minded rulings consolidating a jurisprudential trend settling the open controversy.

   2. Community of owners may now increase the community fees of all those owners who market their properties as holiday lets through holiday platforms

Spain’s Horizontal Act has been amended allowing Community of Owners to increase the communal quota assigned to a landlord of the overall community budget.

In plain English, communities of owners may now vote to increase the community quota of a property owner who uses his property/ies as a holiday home. The Community can vote to increase your quota by as much as 20%.

This change has no retroactive effect.

‘Inheriting’ communal debts

Unlike in other countries, in Spain community debts follow the property, not the owner. When you buy a property in Spain you may find yourself being liable for several thousand euros of unpaid community fees owed by the ex-owner. At times, sellers blissfully forget (God forbid) to mention any outstanding community fees pre-completion. When you buy a property in Spain you immediately take over all existing debts and the seller walks away scot free. A buyer is liable for the previous three years of community arrears plus the current one (total 4 years). More on this in our in-depth blog: Buying in a Community of Owners – Outstanding Debts!

Also, on buying a property, which is part of a Community of Owners, I strongly advise you to request the general assembly’s minutes of the previous 4 years (both AGM’s and EGM’s). The reason is that, unbeknown to you, the community may have voted on an item that requires you to fork out thousands of euros i.e. to repaint the whole flaking paint of the building’s façade. Seller’s at time surprisingly neglect to disclose such key points, I guess they are too busy booking flights to Bora Bora with the sales proceeds!

Which is why, under law, the signing of the deed of transfer of ownership requires a Communities’ certificate, signed by the President and the Secretary (normally the Administrator) stating that all communal fees are up-to-date for that unit. The purchaser can however waive this requirement voluntarily – unadvisable.

Property located in Andalusia

Following arts 7 & 9 of Decree 218/2005, off-plan vendors of property located within the autonomous region of Andalucía must hand over the DIA (Documento Informativo Abreviado) to purchasers. The DIA is the Spanish equivalent of the UK’s Home Purchase Information (HPI), or Seller’s pack. Both the Community’s Statutes and Community Rules must be included in the DIA pack.

Conclusion

There is a general legal backbone, common to all communities in Spain, which is embodied by both the Commonhold Act and the Spanish Civil Code. Besides this girder - which applies nationwide - each community of owners fleshes out its own set of Community Statutes and Bylaws adapted to its own idiosyncrasies; the latter are really the ones that rule on the day-to-day of each community and are unique i.e. no pets allowed in the pool. No two communities hold the same bylaws.

It is strongly advised that, prior to purchasing a property on a development, you request both a copy of the Community Statutes, known in Spanish as Estatutos de la Comunidad de Propietarios, as well as the Community Rules (Bylaws), known in Spanish as Normas de Regimen Interno, if at all existent. You may avoid unpleasant surprises, such as communities that ban pets or even piano players, gasp!

Communities of Owners should be run – in theory – like small, tidy democracies. Well, that’s the theory anyhow.

In practice, they resemble more dictatorships with full blown egos as many owners can vouch for. I would advise you bring your tin hat to owners’ assemblies and prepare for some serious and protracted trench warfare, whereby each owner will hold his own ground, yielding occasionally to fleeting interests.

Good luck; trust me, you’ll need it.

At Larrain Nesbitt Abogados, we can assist you twofold:

 

"Every pound is a prisoner.” Margaret Nesbitt

Margaret Nesbitt (nee Conway) 1917 – 2013. From a humble working-class background, she lost her husband at a very young age, and was forced to fend for herself, single-handedly raising her four young children. Assisted by a generous (unsecured) loan of St Aloysius churchgoers, she bought a guest house in Glasgow and set up a business all by herself, without formal education, which she would run until her mid-nineties. Within only the span of a few years, working hard, she managed to repay the kind private loan with interests on top. As is often the case in life, she placed great value in that which she had been deprived of in her youth, which was a formal higher education;  she went to great lengths to generously ensure all her children, grandchildren and even great grandchildren enjoyed the perks of a privileged higher education. A quiet, courageous woman with strong religious beliefs that always managed to hold a positive outlook towards life despite all the social and financial hardships she was forced to endure and overcome alone. In the wee hours of any morning at Aldara, you would find her guest house’s kitchen brimming with bobbies on the beat enjoying a short pause and savouring the lavish generosity for which she was much loved.

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, inheritance, taxation, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form.

Legal services available from Larraín Nesbitt Lawyers

 

Related articles

 

Article originally published at Spanish Property Insight: Community of Owners in Spain

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.009, 2.012 and 2.019 © Raymundo Larraín Nesbitt. All Rights Reserved

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Golden Visa Spain: 10 frequently asked questions

Raymundo Larraín Nesbitt, October, 2. 2019

Lawyer Raymundo Larraín gives us an overview of the advantages offered by Spain’s Golden Visa application.

Marbella-based Larraín Nesbitt Lawyers has over 16 years’ taxation & conveyancing experience at your service. We offer a wide range of 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Article copyrighted © 2.013, 2.017, 2.018 and 2.019. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8th October 2019

Introduction

The Spanish Golden Visa is a success story.

It has become the gateway to Europe for thousands of applicants pursuing the European dream. They have collectively invested over 2 billion euros since its inception in 2013. Although Spain’s visa programme was a flop initially, as it fell well below expectations and was marred with teething issues, an ambitious overhaul in 2015 made it extremely competitive compared with similar schemes offered by fellow EU countries. So much so, that this massive tweak enabled Spain to confidently overtake Portugal in 2017, becoming Europe’s leading Golden Visa supplier. This is unsurprising, given how Spain overtook the US as the world’s second biggest tourist destination. Spain has become one of the most attractive countries in the world to live and work in.

Although this procedure was originally tailored to cater to well-off Chinese and Russian nationals, many other nationalities have taken advantage of it. British nationals should consider looking into it with renewed interest in a post-Brexit era. The reason is because this scheme would allow British nationals – that lack a EU passport – to travel across Europe skipping pesky passport controls on equal footing to EU nationals. Much like before the UK voted to break away from the Union. You really do not want to be stuck over 3 hours at Heathrow every time, trust me.

Spain’s Golden Visa programme allows affluent non-EU applicants, and their dependants, unfettered access across Europe´s Schengen Area. Travel unmolested through all of Europe.

A Golden Visa enables you, and your family, to live and work in Spain (Europe). This visa guarantees Spanish residency, which eventually leads to Spanish citizenship (optional). Live the dream, apply now!

If you fancy an in-depth take into this subject and read all the advantages a GV has to offer you and your family, please browse our articles listed at the end of this page. Or simply pick up the phone and talk with one of our friendly in-house residency experts.

Apply today for your Golden Visa through Larraín Nesbitt Lawyers: Golden Visa Service. Your family’s success is only one call away: (+34) 952 19 22 88.

Thousands of non-EU nationals have already secured their families’ future and well-being on benefiting from this special arrangement that rolls out the red carpet cutting through all the red tape. Spain’s Golden Visa is a success story, be a part of it!

Why haven’t YOU invested in your family’s future?

 

shutterstock-417631294

Inset photo: Tafelberg, Suid-Afrika

 

10 frequently asked questions

 

  1. Can I request a mortgage on investing €500,000 in Spanish real estate?

Only on the excess above €500,000. The law only requires that the first €500,000 is unencumbered – meaning the equity threshold must be free. The excess can indeed be financed through a mortgage loan if necessary.

  1. I have read that I need to spend over six months in Spain to qualify for residency. Is this true?

No, it is unnecessary. A GV overrides this requirement. This law specifically targets affluent individuals who will normally be residing and working elsewhere. That doesn’t preclude the investor’s spouse and children from living and studying (or even working) in Spain (Europe).

  1. Can I obtain permanent residency or even Spanish citizenship through this law?

Yes eventually, assisted by lawyers specialising in residency. Larraín Nesbitt assigns you an in-house residency specialist to handhold you during the whole visa procedure.

  1. How long does it take to attain a GV application?

On average, it takes under 2 months.

  1. Can I work in Spain?

Yes. Following a change in the GV law, the main applicant may now work in Spain.

  1. Can I make use of the public healthcare system?

No. This blue-ribbon visa targets wealthy non-residents who must hire their own private insurance.

  1. Does the GV also include the investor’s family?

Yes, of course. A married couple and their children under 18 are included under the same application as a family unit. Same-sex partners qualify as a married couple. In some cases, children over 18 y.o. are also included. The term family must be understood broadly.

  1. How long does the Golden Visa last for?

Two years, and you may renew it for a further 5 years.

  1. Do holders of the so-called Golden Visa have unrestricted access to move within the European Union?

In a nutshell, yes. Holders of a Spanish Golden Visa do not require a visa to enter Europe’s Schengen Area. They can transit and enjoy free movement within the Schengen Area for a maximum period of three months (90 days) in every rolling six-month period from the date of first entry. You will have unfettered access to move within the EU.

  1. Where do I apply for a Golden Visa?

Through our law firm. We have 16 years of experience at your service.

Interested? Come and speak to Larraín Nesbitt Lawyers’ friendly staff who will be pleased to guide you through Spain’s Golden Visa programme. Your family’s success in Europe is only one call away: (+34) 952 19 22 88.

 

"The predecessors plant trees [and] the next generation cools off in the shade." – Ancient Chinese proverb.

Golden Visa Service

 Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, inheritance, taxation and litigation. You can contact us by e-mail at info@larrainnesbitt.com, by completing our contact form or by telephone on (+34) 952 19 22 88.

Article originally published at Spanish Property Insight: Golden Visa Spain: 10 frequently asked questions

Legal services available from Larraín Nesbitt Lawyers:

 

Golden Visa related articles:

 

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.013, 2.017, 2.018 and 2.019 © Raymundo Larraín Nesbitt. All rights reserved.

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8 tips on buying a home in Spain

Raymundo Larraín Nesbitt, May, 21. 2019

Lawyer Raymundo Larraín gives us a few insider tips on buying your dream home in Spain.

Marbella-based Larraín Nesbitt Lawyers has over 16 years' taxation & conveyancing experience at your service. We offer a wide range of 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Article copyrighted © 2019. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8th of June 2019

 

1. Location, location, location.

Undeniably a worn out trope, but that doesn’t make it any less true. You are better off buying the smallest house in the best neighbourhood than buying the fanciest house in a less reputed estate. In practical terms, this translates into capital appreciation over the long run as well as making it easy on yourself to sell on. A well-located property enables you to sell it in a few months, as opposed to a poor-chosen location which may leave you waiting for years on end. Seasoned estate agents are your best source of information on the ground when it comes to choosing the ‘right’ address, whether for investment purposes or for bragging rights. Some hallmark names, such as Marbella or Mallorca, are consolidated world-renowned household brands that greatly mitigate exposure to any market downturn, allowing you to buck the trend, as they are always highly sought-after locations.

2. Orientation

On buying property in Spain, we advise you procure yourself a south or south-east orientation due to the sun’s angle. This will ensure your property is drenched in sunlight all year round and will significantly contribute to reduce your heating bills (and electrical bills) in winter. Spain’s electricity is not exactly cheap. If you are in a coastal area, a southern orientation may also secure you nice sea views to boot.

3. Affordability vs maintenance

Budgeting carefully is a key element of any successful conveyance procedure. Yes, you may afford to buy a swanky property in a great location, but can you afford its steep maintenance? Much like some high-maintenance partners in real life, some properties’ upkeep are (very) demanding and you better have the deep pockets to keep up in the game. You really do not want to get involved with a property you cannot afford to maintain, as this will be a financial millstone that will drag your finances down and may even lead you to file for bankruptcy. Only buy a property you are absolutely confident you can afford to maintain over the mid to long run. Do not get carried away with wishful expectations on commanding high rental yields to offset mortgage repayments, as property bills pile up inexorably at the start of every month. If you are relying on rental income to service your mortgage instalments, flat out you shouldn’t buy.

4. Buy-to-let or buy-to-live

This is a fairly important point that is often overlooked by buyers. The characteristics you need to look for are very different depending on whether you are looking at buy-to-let or else with a view to live in. If you are looking at the former, the property must have attained a Licence of First Occupation, it should be smaller, with good communications, within walking distance of all amenities and the sea (on coastal resorts). If you are after the latter, the property should be larger, with nice views, and good schools and hospitals nearby.

5. Ground floor or penthouse?

We had already covered in-depth the pros and cons of each in our blog: ground floor vs penthouse, from a Spanish perspective. Take good note that in Spain both property types are perceived as the opposite from the United Kingdom; which in turn impacts on price, capital appreciation, maintenance and even security.

6. Be familiar with your community bylaws

Before you commit buying a property in a Community of Owners, you should ask for copies of the minutes of the previous General Assemblies, which will highlight any existing issues in your community. It is also of vital importance you fully understand the rules governing your community (i.e. Community of Owners may now outright ban holiday lettings). If you are looking to invest in a buy-to-let and only find out post-sale that your community forbids holiday homes, you have wasted your money. It is also important you fully realize how much money you need to pay every quarter, as some quarterly community fees are exorbitant, especially in exclusive gated communities dotting upmarket coastal areas. Another well-known issue is that some community presidents (which officially hold an unpaid role) perpetuate themselves year after year abetted by their cronies and do in fact make a very tidy living running whole communities at the expense of pocketing fees from fellow owners on fudging the numbers. I tell you - by experience - that no one who has held the role of community president wishes to repeat from one year to the next as it is a very ungrateful task. Be wary of community presidents who hold their position indefinitely and fight tooth and nail to retain power and control. Only on changing administration does the corruption of the former management come into light.

7. Urban vs rural

Unlike in the United Kingdom, rural property in Spain is marred with legal issues. In the region of Andalusia alone, there are over 200,000 illegal properties. Buying a property with issues could see your trapped for years on end without a chance of selling it on. Moreover, on buying an illegal property you take over the liability of any prior planning illegality; the previous owner gets to walk away scot free – with your money. On buying rural, hiring a competent conveyancing lawyer from the outset is a must to help you waddle through the admin minefield. I would advise a reputed surveyor is also instructed, preferably regulated by RICS and working to UK standards. That is not to say that urban property is all good and rosy, far from it. But no doubt urban property offers much less legal risks than its rural counterpart. If you are looking for a quiet rural life to commune with nature, the choice is obvious. If you are more the city type, that easily gets bored watching grass grow and sheep bleat, you may want to look at urban instead.

8. The lawyer

A necessary evil. You would never buy a property in the UK without instructing a solicitor or conveyancer, and yet a surprising number of people choose not to instruct a lawyer or legal representative when buying abroad. If anything, it is even more important to obtain good legal advice when buying overseas as it is highly likely that you will be unfamiliar with many of the key processes. Whilst it is possible to buy a property in some overseas jurisdictions, including Spain, without having to appoint a lawyer, it would be very unwise to do so. Buying a house is one of the biggest investments most people make in their lifetime. So why take the risk by not obtaining proper legal advice?

Choosing a reputable conveyance law firm will be your best line of defence against the stack of odds you will be facing. Make sure your lawyer is truly independent and is not affiliated with your chosen estate agency in any way, you would come to regret this. Having a seasoned lawyer on board is having half the fight already won. Your lawyer will be able to cut through the red tape seamlessly, enabling you a smooth and safe buying procedure. Three expenses on which you should never skimp are: doctors, lawyers and education. You would regret dearly ‘saving’ money on any of the three.

Our law firm has over 16 year’s conveyancing experience at your service. We are members of the British Chamber of Commerce, Spain, and regulated by the Spanish Law Society.

Because peace of mind is priceless.

Conclusion

But enough of platitudes. All that matters is that we are in a buyer’s market.

Do not be rushed into buying a property, you will be spoilt for choice.

If you have qualms over a property, or its area, why don’t you consider renting it for a while? You should ponder such factors as leasing it on or off-peak. You can always sign a rent-to-buy contract. If it is to your liking, then go ahead and buy it; you only live once.

 

We offer the most competitive fees in the market.

Conveyancing – Buying fees on application

We are specialized in conveyancing

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, inheritance, taxation and litigation. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

Article also published in Spanish Property Insight: 8 tips on buying property in Spain

 

Audentis Fortuna iuvat.” – Aeneid, Virgil.

Loosely translated as “Fortune favours the bold.”

 

Legal services available from Larraín Nesbitt Lawyers

 

Conveyancing-related articles

Buying distressed property in Spain – 8th August 2011
Buying resale property in Spain – 21st February 2013
Buying off-plan property in Spain – 8th of June 2013
How to buy commercial property in Spain – 4th July 2014
How to buy rural property in Spain – 8th August 2014
How to Buy Property in Spain Safely – 10th October 2014
House Hunting in Spain – Interview with The New York Times. June 2015
Buying property in Spain from a private seller (Resale Property) – 21st of February 2017
Buying property in Spain from a developer (Off-Plan Property) – 8th March 2017
How to inspect an off-plan property overseas – Q&A with The Sunday Times. July 2017
Buying property in Spain – 10 reasons to hire a lawyer – 8th November 2016
8 Tips on Buying Off-Plan in Spain – 8th June 2018
Tax advantages on becoming resident in SpainThe Address magazine (pages 358 - 373). December 2018
Taxes on buying Spanish property – 8th December 2018
Do’s and don’ts on buying property in Spain – 8th April 2019
8 tips on buying a home in Spain – 8th June 2019

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.019 © Raymundo Larraín Nesbitt. All rights reserved.

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Do’s and don’ts on buying a home in Spain

Raymundo Larraín Nesbitt, March, 25. 2019

Marbella-based lawyer Raymundo Larraín gives us a few light-hearted tips on buying a home in Spain.

Article copyrighted © 2019. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8th of April 2019

 

 

Springtime is upon us. It is again that bright season of the year where flowers bloom, bees dart around doing whatever it is they do, and real estate agents are busy dusting off glossy house brochures with a big smile on their face. Scores of buyers will now be booking flights to Spain with a view to acquire their dream house next to the sea.

With this in mind, I thought it would be a good idea to write this short amusing article to clue up buyers, so their dream does not turn sour on tripping themselves over in pursuit of their bolthole under the sun.

 

3 Do’s

 

  1. Hire a qualified registered lawyer (abogado)

I know, I know. I just had to add this shameless plug in the first place.

No, a Spanish Notary is not your personal lawyer and will not look after your interests. He’s there to ensure taxes are paid, period.

No, a lender does not susbstitute a lawyer and much less defends your legal interests on taking on a mortgage loan. No, they do not do a due diligence on the property title. A lender is there to give you a loan, period.

Beware of intruders who claim to be lawyers or law firms but are not registered to practice. Within the last year alone, I’ve come across three such interlopers. Unlike lawyers, they don’t have professional indemnity insurance and lack the legal qualifications to practice. I see plenty of such outfits advertising themselves regularly on popular expat magazines with glossy ads peddling their conveyance ‘services’. They will label themselves with all sort of fancy titles such as: consulting firm, legal consultant, iuris consultant, jurist, legal executive, legal advisor, legal assistant, paralegal etc.

In Spain it is very simple, you are either a lawyer (abogado) or you are not; there is no in-between. Always ask the person you are dealing with for their Law Society’s practising number and verify they are indeed registered to practice. Wrong assumptions lead to expensive mistakes.

  1. When in Rome, do as the Romans do

I know, we have all been there. You come to Spain and you think some things are stupid and you could do them much better in your own way. Perhaps, perhaps not. The point is that there are rules in place you ought to follow; if you skip them nonchalantly, you are only setting yourself up for a nasty fall.

  1. Follow the 3 L’s: Look, listen and liken

This is not your turf, it is a new world you’re braving. Take your time to look around where you picture yourself living. Visit the property during the week and over the weekend, by day and by night. Listen to what neighbours and natives have to say about the place. Compare the pad you fancy with other similar properties and areas. If all adds up, go for it. You only live once.

3 Don’ts

  1. Don’t pay any money in cash

Would you seriously pay in cash a home in your home country? So, why do it in Spain? This only benefits the person asking to be paid in cash, it does not benefit the buyer in any way. When you come to sell the property later on, you will be hit by a massive capital gains tax bill. Under-declaring is illegal, it is stupid; don’t be a muppet.

  1. Don’t be pressurized to sign

The never-ending sun, the sweltering heat, the cool sea breeze, the enticing beach sunset with a mojito and a saxo playing, all them nice piña coladas you drank late into the night, the soft-spoken agent gently cooing into your ear promises of wealth and capital appreciation; all these things play tricks on our minds and make us lose the plot when we get off a plane in Spain. Unlike timeshare, there is no cool-off period when you buy property in Spain. Holding deposits are normally non-refundable (unless your lawyer words it). If you wouldn’t rush ahead and sign on the dotted line in your home country, don’t do it in Spain. Focus, breath and take your time to commit before you sign any binding document giving away your life’s savings. Don’t let the big lights dazzle you, you will be spoilt for choice. It's a buyer's market.

  1. Don’t cut corners

“Jack knows how to cut through all this red tape.” Maybe he does, maybe he doesn’t. Don’t try to outsmart local procedures by cutting corners; it is a one-way ticket into a world of pain. If you would follow set procedures in your home country, why on earth are you trying to skip them in Spain?

 

We offer the most competitive fees in the market.

Conveyancing – Buying fees on application

We are specialized in conveyancing

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, inheritance, taxation and litigation. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

 

"Me ha bastado pensar que la naturaleza pertenece a los niños para reanudar mi batalla encaminada a la conservación de la fauna.” — Félix Rodríguez de la Fuente

“I need only remind myself that Nature belongs to our children’s morrow, to give me strength in the battles to come in defence of wildlife conservation.”

Félix Samuel Rodríguez de la Fuente (1928 – 1980). Decades before the BBC's brilliant Planet Earth, narrated by Sir David Attenborough, there existed Félix. He was a Spanish precursor of what is now branded as ‘ecologist.’ The son of a reputed Notary, he was expected to dutifully fall in line and follow on the wake of his father’s footsteps. But following social conventionalisms were not his cup of tea. After graduating in medicine, he heeded his calling and would go on to become a naturalist and broadcaster defending what he thought mattered most - Nature and the endangered wildlife. He would become world-renowned for his much-acclaimed tv series El Hombre y la Tierra (1975 – 1980). His calm, collected demeanour and rugged commanding voice, coupled with powerful images of an unleashed Nature the likes viewers had never witnessed, bewitched Spaniards and other nationalities, for decades to come. His enduring legacy would be to imbue and imprint on younger generations his indelible passion and love in defence of Mother Nature. This constitutes all unto itself a wondrous feat, given how Félix managed single-handedly to change the whole country's mindset, which was not particularly renowned for its love and protection of wildlife at the time (seventies). He had a soft spot for wolves, which had been driven by Authorities to the brink of total annihilation. Decades on after his death, young generations of Spanish ecologists and eco-activists, who grew up watching his show, took the torch and would follow on the path laid by him, steadily bringing back wolf packs into a land which was once their rightful domain. He would tragically meet an untimely death in a plane crash aged only 52. No accolade can honour enough what this man achieved in benefit of us all. Almost four decades on after his tragic death, he is still mourned and is credited as the father of Spanish environmentalism. There isn’t a single town in Spain who does not pride itself in having a street or plaza named after him. So much for adhering to social conventionalisms, eh?

 

Article also published in Spanish Property Insight: Do’s and don’ts on buying a house in Spain

Legal services available from Larraín Nesbitt Lawyers

 

Property-related articles

House Hunting in Spain – Interview with The New York Times. June 2015
Resurgent Spain: Málaga Sees Strong Sales – Interview with Mansion Global (The Wall Street Journal). December 2015
Buying Property in Spain from a Private Seller (Resale Property) – 21st of February 2017
Buying Property in Spain from a Developer (Off-Plan Property) – 8th March 2017
How to inspect an off-plan property overseas – Q&A with The Sunday Times. July 2017
Buying Property in Spain – 10 Reasons to Hire a Lawyer – 8th November 2016
Non-Resident Taxes in Spain – 8th December 2015
Non-Resident Income Tax – 8th December 2017

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.019 © Raymundo Larraín Nesbitt. All rights reserved.

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