Spain Explained

The community of owners in Spain

There are countless urbanisations each hosting their own community of property owners (Comunidad de Proprietarios) throughout Spain.  On the whole they can be beneficial organisations. The intention is that through the annual general meeting decisions are made relating to the community and its upkeep. Common elements, such as swimming pools, stair wells, garden areas and other community facilities are cared for collectively.

However, having a community of owners does have its draw backs.  Permission must be sought if you want to alter your property and rules for the use of community facilities in Spain are set by the community as a whole.

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Some communities function extremely well. They enable the maintenance of a high standard of appearance for their properties and ensure the behaviour of those ‘passing through’ such as those renting or visiting.

However, there can also be difficulties. Enforcing the payment of community fees and disagreements between community members are two of the complaints most regularly featuring on forums and in discussions. It is well worth finding out more about your community of owners before buying the property.

Community fees

Each owner is assigned a percentage (cuota) of the annual expenses, and this percentage is shown on the Title Deeds of the Spanish property. The charges vary from community to community and it is one of the questions you should ask when purchasing.

The fees might be collected by standing order monthly, quarterly or at longer intervals. They are used to pay for expenses such as:

  • The maintenance of lifts and communal areas
  • Cleaning, sweeping and tending of outdoor garden areas
  • Costs of running the community itself e.g. payment for the administrator
  • Upkeep of security such as gates and doors
  • Maintenance of swimming pools
  • Community personnel such as a security guard or caretaker

The collection of community fees can be an issue in some communities. For example, it can be a particular problem where there are a large number of unpopulated houses or where there are difficulties collecting fees. This can cause tensions and additional expense for those using the facilities.

There are methods of recovering debts but they are not easy to pursue and some properties on communities lapse until the property is sold. If you do not pay your fees then you can still attend the community annual general meeting but will not be allowed to vote to elect either the Secretary or the Administrator. You will also be prohibited from contesting any decisions taken.

If the fees are not collected then they remain as outstanding debts against the property. When the owner comes to sell either they or the buyer will have to settle these before the property can change hands. A good solicitor will ensure that the community certificate of debt is checked at the Notary’s office.

People sometimes confuse their community fees with their council tax. Remember there will still be Spanish council tax to pay to the local town hall. This tax pays for the services that the council provides such as major road maintenance and street lighting external to but leading up to your urbanisation.

How is the community run?

Every community of owners must have a President who must be one of the property owners. They must also have an administrator who understands the law and how a community operates and fees are charged for this service. There is usually a college for administrators somewhere within the region who can supply administrators .For example, in the province of Alicante there is the Colegio de Administradores de Fincas de Alicante.

Members are entitled to attend the Annual General Meeting and should receive notification of when this is being held in sufficient time for them to arrange their attendance. Participants should be informed of the order of business and have the right to express their opinions and the right to vote at the meeting.

During the Annual General Meeting the president and administrator will be elected and the budget for the past and coming year should be discussed. The Statutes of the Community should be approved and any internal rules agreed. The president may also call an Extraordinary General Meeting.

The meeting will most likely be held in Spanish, depending on the balance of native and foreign speakers. There might be opportunity to vote to change the language the meetings are held in. If you are not able to attend you can appoint a representative and can delegate your vote to another member or appoint a proxy.

Minutes of meetings are recorded in a book (libro de actas) and these can be used as evidence in court proceedings. The administrator will keep the book of minutes.

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How do I join one?

There is no option of joining or not joining a community of owners. You are immediately a member once you have bought your property and must abide by the legal rights and obligations that come with it.

What happens if we don’t have one?

In some cases urbanisations have found that their community has no real purpose. Perhaps there are few shared facilities and the property owners feel generally that their needs would best be served by the council. Where this is the case, there is an alternative. If your urbanisation has no real common elements then it can be possible to unanimously dissolve the community.

Overall, the concept is a good one and having agreed rules to abide by can prevent many of the niggles between neighbours that can occur otherwise.

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8 comments

BOB KAMMINGA

30 October, 2019 9:02 pm

Have the following questions
The board is refusing to have the AGM end april when most owners present. but insist on early in the year.
There is one owner ON THE BOARD having a majority of shares (Investment company) during meetings
of the bioard and AGM
There is one BIG Owner (A Bank) never voting.
This means that whatever individual owners are proposing in a AMG against the investor
nothing can be done because the investor dominates the AGM
Do you see a solution?
Would highly appreciate your advise

Oscar Paoli

5 November, 2019 1:57 pm

Hello,

Regarding the date of the meeting, the law says nothing about it but the resolutions stipulate that the AGM has to be on a reasonable date in which it can be guaranteed that the neighbors can attend and also notify them in advance so they can organize the assistance non-residents The date of the next AGM is voted in the previous meeting. If they disagree with the agreed date, they have one month since they receive the minutes to file a complaint with the administrator / president or in court.

On the other hand, unfortunately they cannot do much against the investor since if he has the most votes / quotas, he will have a majority. Therefore, provided that the investor complies with the law and the norms of the community, no action may be taken against him.

With kind regards,

Ábaco Advisers

Bonny

12 November, 2019 5:49 pm

How the VAT is treated on community fees? Are they VAT exempt? The community of property owners cannot claim input VAT?
Do you know the rule?
Would highly appreciate your advise. Thank you.

Oscar Paoli

13 November, 2019 10:00 am

Hello Bonny,
VAT will be treated differently depending on the matter. For example works done to maintain or small repairs the communal areas in the community will be charged with VAT at 21% but if it is works like for example putting in an elevator in the community this is taxed at 10% VAT.
We are not experts in this matter, but we recommend you contact the administrator in your community who will be able to assist you in the matter.
Here is also a link to some useful FAQs that are responded by the Spanish Tax Authorities:

https://www.agenciatributaria.es/AEAT.internet/en_gb/Inicio/_Segmentos_/Ciudadanos/Vivienda/Obras_en_viviendas/IVA/Preguntas_frecuentes/Preguntas_frecuentes.shtml

With kind regards,
Ábaco Advisers

Graeme Duncan

6 February, 2020 12:19 pm

Hi, I have one question regarding the attendance of “administrators” at the AGM. One of the topics for discussion at our up coming AGM is the election of the administrator. The intention is to select a new one as the community is not at all happy with the current one. In the UK & US at company board meetings you can do something called “in camera” sessions, where certain people are asked to leave as the topic is confidential or could cause conflict. We intended to use this approach at this point in the agenda as we did not want the admin agent sat there taking minutes and making representations when we are are in effect sacking them and selecting a new one and exploring their difficiencies”. However the admin agent has rejected the idea of an “in camera” session (probably becuase they know what is coming), stating by Spanish law they “as the secretary of the community approved last year will not sit out any part of the meeting”. Is this true? If so how can we achieve our aim?

Oscar Paoli

11 February, 2020 3:14 pm

Hi there,
Unfortunately it is true, they will not sit out any part of the meeting, even if you wish to discuss the matter of changing administrator.
With kind regards,
Ábaco Advisers

Andrew Moore

25 March, 2020 8:38 am

Hello there. I am an English resident of a small community in Benidorm. The community has thirty apartments. I understand that if elected or selected through “drawing straws”, a President of a community cannot refuse to perform the role unless sanctioned by a judge. On what grounds would this appeal likely to be successful? My interest is academic only at the moment but I do not feel that I would have the competence to perform this role if I were ever burdened with it. Essentially, although I can speak some Spanish (low intermediate level), I do not have the Spanish language skills to execute the role and although it would probably be of no concern legally, I have neither the time nor the interest to perform this role conscientiously. It would appear to me extremely stupid for a community to appoint someone as a President under these circumstances but crazier things have been done!

Oscar Paoli

27 March, 2020 4:34 pm

Hi Andrew,

According to the horizontal property law, the president is appointed by election or, if no one proposes, by rotating shift or lottery. The appointment is mandatory, although the designated owner may request his release to the judge within the month following his access to the position, explaining the reasons one may have. The judge will then decide by appointing the owner to replace in his case.

Likewise, the judge may be called upon when, for any reason, it is impossible for the Board to designate the president of the community.

With kind regards,

Ábaco Advisers