The Functions of a Spanish Notary
By Armin Gutschick & Anja Sämann-Gutschick
As of 2022 there are nine notary offices distributed throughout the various communities on Ibiza and Formentera. A Spanish notary is obligated to act impartially, and to give the all parties involved equal and balanced advice. The notary formally accepts the declarations of the parties, which gives them official authentification ("fe publica"). In order for a document to be entered in a public register, it must first be authenticated by a notary.
When buying a property an entry should be made in one of the four land registries in Ibiza. When founding a company the entry is made in the commercial register.
The Spanish notary not only certifies purchase contracts, but is also very often used to issue powers of attorney.
The most common example is a power of attorney given to lawyers or other legal representatives. In Spain this usually has to be recorded by a notary. In recent years, Spain has added the concept of voluntary jurisdiction, which makes it possible to get married in front of a notary and, under certain conditions, to divorce by mutual agreement.
Notary fees in Spain are significantly lower than in many other EU countries.
On the one hand, this is due to the fact that notary fees in Spain have essentially not increased for over 30 years. On the other hand, powers of attorney, wills and marriage contracts are not settled on the basis of the "business value". In Spain they are documents without an indication of value ("documentos sin cuantía"), so there is a set fee that is not linked to a business value.
The Spanish notary fees ("arranceles notariales") are fixed by law. For example, a notary in Ibiza will charge a fixed fee of around 40 euros for the registration of a power of attorney or a will, plus a small surcharge for documents longer than five pages. With this in mind, clients should ask themselves whether it is significantly less expensive to notarize a power of attorney or a will with a Spanish notary, rather than in their home country. In addition, a Spanish notary can grant the client a discount of up to 10%, and in the case of a real estate purchase contract of six million euros or more, the notary fees are freely negotiable.
An odd aspect of the Spanish notary system is that it does not give notaries the right to hold a purchase price in trust. This has its roots in Spanish civil law, where strict causal law applies. This basically means that every legal transaction must affect both parties. In the case of a payment of money to a notary account held in trust for a process that does not affect the notary personally, this causal connection does not exist. For this reason, Spanish notaries who offer a trustee account must do it through an independent deposit deed ("Acta de deposito"), which entails additional costs for the client.
The Spanish notary only takes care of the logging of the purchase contract itself, but does not handle of the registration of the transaction, or the payment of the taxes incurred. The buyer must hire his own tax advisor for this. Spanish notaries assume no liability for the status of the entry in the land registry at the time of certification. The notary only explains to the parties the status of the land register at the time of his last inspection of it, which usually took place the day before.
It would be very helpful to the parties if Spanish notaries could handle transactions more completely. Ideally they would receive the purchase price, delete the encumbrances, arrange for the pre-registration (“asiento de presentación”). Only then, when it was certain that there were no more encumbrances, the purchase price to the seller would be paid. However, since the Spanish notary system does not provide for these mechanisms, it is advisable to consult a lawyer during the preparation and follow-up of a notarized deed of sale.