Clear and enforceable contracts are critical to business success in Spain. Whether you’re entering into a commercial agreement, joint venture, or partnership, contracts must be drafted in accordance with Spanish law and tailored to your industry and risk profile.
This guide outlines how to draft and negotiate contracts in Spain, especially for foreign businesses and investors.
⚖️ Legal Framework
Spanish contract law is governed by:
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Código Civil (Spanish Civil Code)
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Commercial Code (Código de Comercio)
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EU regulations (if cross-border)
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Relevant sector-specific regulations (e.g., franchising, distribution, employment)
Contracts in Spain can be oral or written, but written contracts are highly recommended for enforceability and clarity.
✍️ Key Elements of a Spanish Contract
A typical business contract should include:
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Identification of the parties
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Purpose and scope of the agreement
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Obligations and rights of each party
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Payment terms and deadlines
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Duration and termination clauses
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Governing law and jurisdiction
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Confidentiality and non-compete clauses
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Dispute resolution mechanisms (litigation or arbitration)
Optional but common: penalty clauses, force majeure, and warranty disclaimers.
🤝 Contract Negotiation Tips for Foreign Businesses
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Define terms clearly: Avoid ambiguity, especially in cross-border contracts
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Use bilingual contracts: Recommended if parties speak different languages
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Understand local customs: Spanish negotiation practices may differ from Anglo-Saxon legal traditions
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Address VAT and tax implications: Ensure the contract reflects your tax responsibilities
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Protect your IP: Include clauses on ownership and usage rights if applicable
⚠️ Common Mistakes to Avoid
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Using a generic template not adapted to Spanish law
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Failing to specify governing law and jurisdiction
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Ignoring tax or labor law consequences
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Overlooking required formalities for certain contracts (e.g., notarial deeds for real estate)
🧑⚖️ Enforcement of Contracts in Spain
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Spanish courts generally uphold written contracts unless they violate public policy
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Dispute resolution may occur through courts or arbitration, depending on the agreement
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Damages, interest, and specific performance are common remedies
🤝 How Borderless Lawyers Can Help
We support businesses with:
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Drafting legally sound commercial contracts
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Reviewing existing agreements for risk exposure
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Negotiating terms with Spanish counterparties
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Advising on cross-border and bilingual contract strategy
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Resolving contract disputes efficiently