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V4238-16 3 October 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · exención por participación significativa

Requirements for the double taxation exemption in the transfer of shares

A consultation was made regarding whether the 5% minimum shareholding requirement under Article 21 of the LIS is met if a sale is conducted via an accelerated placement process involving multiple investors. The DGT ruled that the requirement is satisfied on the date of the transfer, regardless of whether the acquirers are different entities.

The question raised

Question raised 1) Whether the requirement regarding the minimum shareholding percentage of 5 percent, required by Article 21 of Law 27/2014, of November 27, on Corporate Income Tax, would be met, notwithstanding that the sale was carried out through the accelerated placement procedure among qualified national and international investors.

The DGT's ruling

The requirement of significant participation (5% or a value exceeding 20 million euros) must be met on the date of the transfer. In an accelerated placement procedure where the 5% transfer is carried out on the same day, even if the acquirers are different institutional investors, Article 21.3 of the LIS is understood to be fulfilled. The application of the exemption depends on the percentage of participation or the acquisition value prior to the transfer, regardless of the percentage transferred or the percentage held subsequently.

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