TL;DR: Spain is enthusiastically engaged with EU Inc, the proposed pan-European company form (the “28th regime”) that would make cross-border incorporation possible in 48 hours for €100. At the same time, Spain is the only member state the European Commission has referred to the Court of Justice of the EU for failing to transpose the 2022 VAT rates directive, with financial sanctions being sought. The two positions together describe a country that wants to lead on the future of European business formation while struggling to implement the pan-European rules that already exist. For freelancers and small businesses in Spain, the practical implication is that the compliance environment is going to stay noisy for the next couple of years.

There is a pattern in Spanish EU policy that has been on my mind for a while, and this week it crystallised for me. Spain is loudly, publicly engaged with the proposed European corporate form known as EU Inc. Spanish policymakers show up at the consultations, contribute to the drafts, and speak about the initiative in the language of European leadership. It is exactly the kind of forward-looking, pan-European economic infrastructure that Sánchez likes to associate with Spanish governance.

And yet, on 12 March 2026, the European Commission referred Spain to the Court of Justice of the European Union for failing to transpose Council Directive (EU) 2022/542, the VAT rates directive. Spain is the only member state that has not notified transposition. The Commission is asking the Court to impose financial sanctions. The provisions concerned include the place of supply for VAT on virtual and streamed services, and the special scheme for second-hand goods, works of art, collectors’ items and antiques. Twenty-six other member states have transposed. Spain has not.

Sit with that combination for a moment. Spain wants to help design the future pan-European company form, while unable (or unwilling) to implement the pan-European VAT rules that were agreed nearly four years ago.

Of course if you’ve lived in Spain for a few years, you won’t even be surprised by this kind of doublethink. In some ways Spain leads the way in digital transformation and over my decade and a half as a resident I’ve seen some genuine leaps forward. However at other times it feels like the urge to digitise and modernise is being held back by an albatross of administration and paperwork that Spain is unable to shake off within its bureaucratic sector.

So what does that mean for a completely new business formation paradigm?

What EU Inc actually is

EU Inc, sometimes called the 28th regime, is a Commission proposal published on 18 March 2026 for a new corporate form that would exist in parallel with existing national forms. Companies would be able to incorporate under a single EU-wide legal framework rather than choosing between 27 national systems.

The headline features, drawn from the Commission’s proposal and the tech industry summary:

  • Incorporation and registration in 48 hours
  • Cost capped at €100
  • Fully digital central EU interface and registry
  • No notary intervention required
  • No minimum share capital
  • Automatic transmission of company data to tax and social security authorities

For anyone who has ever tried to set up a Spanish SL as a foreigner (notary appointment for the escritura pública, minimum share capital of €3,000, filing at the Registro Mercantil, weeks of paperwork before you can invoice a single euro), the EU Inc proposal reads like a different universe. The Commission has set the ambitious objective of political agreement by the end of 2026, though the timeline is honestly optimistic given the number of member state sensitivities involved.

Spain’s engagement here is real and, on the face of it, welcome. The Spanish market has quietly evolved systematic workarounds for the awkwardness of the domestic corporate framework, particularly around stock options and treasury share limitations. A pan-European alternative form is genuinely attractive for startups and small businesses that want to operate across borders without wrestling with 27 different rulebooks.

Meanwhile, the VAT rates directive is unimplemented

The directive Spain has failed to transpose is technical, but its practical implications for cross-border digital services and second-hand markets are meaningful. The Commission has been clear that the lack of transposition creates the risk of double taxation or non-taxation, because Spain’s rules diverge from the other 26 member states.

Spain also has its own ViDA transposition track, separate from the 2022 directive. A December 2025 draft law was published as a targeted “Phase 1” of ViDA transposition, focused on OSS-related refinements, distance-sales threshold clarifications, and certain non-EU refund mechanics. Application is planned from 1 January 2027. So the picture is not that Spain does nothing on VAT; it does plenty, but selectively. The 2022 directive sits in a different queue that hasn’t moved.

What this pattern tells us

If you spend enough time watching Spanish compliance behaviour on EU rules, you start to notice a shape. Spain participates enthusiastically in the design of new pan-European frameworks that align with its strategic and political priorities. It moves less quickly on transposing existing rules that require domestic legislative bandwidth and cabinet coordination, especially when the practical impact is technical rather than politically salient. The Pay Transparency Directive missing its 7 June deadline (Spain among 23 member states in breach) fits the same pattern. So does the Platform Work Directive transposition, which is progressing but not at the front of the queue.

This is not a story of bad faith. It is a story of a country with limited legislative bandwidth, an ambitious external face, and a domestic implementation record that lags behind the ambition. Both things are true.

The concrete problem for autónomos providing cross-border services

This is where the abstract compliance discussion stops and the real problem starts.

Imagine you are an autónomo based in Spain delivering online training, streamed webinars, virtual consulting, or any other service that is provided from your desk in Spain to a client somewhere else in the EU. Council Directive (EU) 2022/542 changed the VAT place-of-supply rules for exactly this kind of virtual and streamed service. The 26 other member states have transposed those rules into their national law. Spain has not. Spain is still operating under the pre-directive rules.

That creates a genuine mismatch. If you provide a streamed service to a French customer, Spanish VAT rules and French VAT rules now diverge on where the supply is deemed to happen. B2B transactions are usually saved by the reverse charge mechanism (your business customer accounts for VAT in their own country under their own rules), but B2C transactions and mixed scenarios can end up in a real overpayment loop. In practical terms:

  • You charge Spanish VAT under the old rules that are still in force in Spain, because that is what the AEAT expects and what your gestor will tell you to do.
  • The customer’s country expects the supply to have been treated differently under the new EU-aligned rules, and may look for VAT to be accounted for on their side as well.
  • The customer pays effectively twice. VAT once in Spain (embedded in your invoice), VAT again in their country under the reverse charge or their equivalent B2C rules.
  • You are technically compliant on the Spanish side. You have followed Spanish law as it currently stands. You have done nothing wrong.
  • You are also potentially exposed on the other side, because the destination country’s tax authority may not see it that way.

Refund routes for overpaid VAT within the EU exist, but they are administratively heavy, they typically take months to work through, and they usually do not compensate for the cash-flow cost of having the money sitting with a tax authority. For a solo trader running modest monthly turnover, the overpayment can be non-trivial in absolute terms and genuinely painful in cash-flow terms. The situation should resolve when Spain finally transposes, but the mismatch window is happening now, and it is happening because Spain has not moved on rules that other member states implemented two to three years ago.

The second-hand goods and works-of-art scheme provisions in the same directive are less relevant to most RWE readers; they matter mostly to dealers in those specific markets. The place-of-supply provisions for virtual services are the ones that catch our audience directly.

What this means for freelancers and small businesses in Spain

For anyone running an autónomo activity or a small business here, four practical takeaways.

First, the EU Inc route is worth watching but not planning around yet. If it lands as designed by end-2026, it will represent a genuinely faster and cheaper corporate formation route for cross-border micro-businesses, particularly those with founders in more than one member state. But the political agreement is not guaranteed on the current timeline, and the actual member state opt-in mechanics will take longer to work through. If you are considering incorporation in the next twelve months, decide based on today’s Spanish SL rules, not the EU Inc hypothetical.

Second, expect Spanish VAT rules to stay noisy through 2027. Between the pending 2022 directive transposition (whenever the Court decision lands), the ViDA Phase 1 draft law application from January 2027, and Verifactu becoming mandatory for autónomos in July 2027, the invoicing and VAT compliance environment is not settling down. Build your systems assuming multiple rule changes over the next 18-24 months, not one.

Third, if you invoice cross-border digital or streamed services, get proper advice on your current exposure. The place-of-supply mismatch is happening now. A one-hour conversation with a gestor who actually understands both Spanish and EU VAT (they are not all the same) is a good investment. If you are being asked to charge Spanish VAT on services that other member states would treat differently, understand what the risk is on both sides and factor it into your pricing and your cash-flow planning. If your gestor doesn’t feel confident on the cross-border side, our recommended partners at Xolo can guide you through it; they work with autónomo clients across Europe and understand the mismatch specifically.

Fourth, this feeds the general anxiety about tax in Spain, and that anxiety is not misplaced. One thing that comes up consistently in conversations with autónomos in Spain, from newer arrivals to long-term residents, is a low-grade constant worry about doing something wrong on tax without realising it. The compliance environment does not help. It is not just Verifactu, not just the pending ViDA transposition, not just the annual renta stresses. It is the accumulated sense that the rules keep moving and that even doing your best you might turn out to have been on the wrong side of a directive that hadn’t been implemented yet. That worry is a real cost of operating here.

This anxiety is something Remote Work Europe is planning to explore in a proper research exercise later this summer. It is a widely-felt experience among foreign-national autónomos in Spain, and it deserves proper investigation rather than a passing observation. If you have stories to share about the compliance anxiety you have experienced setting up or running your business here, watch this space or get in touch.

Spain’s compliance posture is genuinely mixed. Enthusiastically pro-European on the shape of tomorrow’s rules, patchy on the transposition of yesterday’s ones. Both things are policy. Both things affect the environment we run our small businesses in, and both things sit in the background of the low-grade anxiety a lot of us live with as autónomos here.