The franchise market in Spain is undoubtedly a growing market, and of enormous importance in various sectors of our economy, from catering and hospitality, beauty, health and well-being, professional services, etc.
The franchise is a model of a commercial contract in which a company, called franchisor, transfers the rights of exploitation, trademark and Know How, to another company, the franchisee, for the exploitation of a business in a specific time and place, and under conditions agreed in the franchise contract.
The franchisor can assign that brand and Know How, to several successive franchisees, which often results in the exploitation of the same business by successive franchisee companies.
On many occasions, when such succession occurs, the tax debts of the former franchisee may, in some way, be inherited by their successors, subject to certain requirements, as provided for in article 42 of the current General Tax Law.
The recent decision of the Central Economic and Administrative Tribunal (CEAC) No. 7746/2024 of 29 January 2026, binding on the Tax Agency, in which it has been established as a criterion the possibility of deriving joint and several liability for tax debts, from the previous to the new franchisee, without the need to derive tax liability, at first, to the franchisor.
Historically, the doctrine was that the Tax Agency could not jump directly from the old to the new franchisee, since it had to first target the franchiser (the brand), since this was the intermediate subject. This protection against the “per saltum” derivation was a false sense of security when it came to succeeding a company in a certain franchise business.
The factual assumption of Resolution 7746/2024 of 29 January 2026 was the succession in the operation of a service station, under which SOCIETY X formalized a franchise contract with PETROLER SOCIETY AND for the management and operation of a service station until the termination of the said franchise contract; SOCIETY X upon cessation of its activity maintained tax debts in the form of corporation tax and value added tax that were paid to the Tax Agency.
Following the termination of the franchise agreement between SOCIETY PETROLERA Y and SOCIETY X, the same service station was operated by SOCIETY N following the formalisation between the latter and SOCIETY PETROLERA and a new franchise agreement signed on the same day that the contract between SOCIETY X and PETROLERA SOCIETY was terminated and, in addition to other elements, that is, the same economic activity (the service station), the same social object, the same suppliers, the same customers, and the transfer of staff.
The Tax Agency, in view of the existence of debts arising from the exercise of economic exploitation by SOCIETY X, initiated a procedure for derivation of the joint and several tax liability provided for in Article 42(1)(c) of the General Tax Law with SOCIETY N. This procedure culminated in the declaration of joint and several tax liability of SOCIETY N of the tax debts incurred by the former subject who exploited the service station (SOCIETY X) under a franchise regime, without deriving tax liability from the franchisor.
After several Administrative Economic Claims, the Central Economic Administrative Court finally ruled, giving the Tax Agency the reason, since the franchiser, the PETROLERA SOCIETY Y, had never exercised the activity of operation of the station of service, being therefore compensated in this case. Different would have been the case if the PETROLERA SOCIETY Y, had happened in the operation of the station of service to SOCIETY X, before formalizing a new franchise contract with SOCIETY N, because in that case there would have been succession of the franchisor.
The joint and several liability for succession in the activity can be avoided by means of the mechanism regulated in Article 175.2 of the General Tax Law, requesting, after the consent of the employer to whom it is going to succeed, a detailed certification of the debts, penalties and tax liabilities resulting from its exercise.
The tax administration shall issue such certification within three months of the application. In such a case the purchaser shall be liable only to the debts, penalties and liabilities contained therein. If the certification is issued without mentioning debts, penalties or liabilities or is not provided within the specified period, the applicant shall be exempt from joint liability.
When it happens in a business to any person, whether natural or legal, it is very important to negotiate this point; for it is not enough for us to be presented at the time of the sale a certificate of being informed with the Tax Agency, since that generic certificate will not exempt from possible tax liability derivatives, but only the certificate of succession in the activity in which the debts, penalties and tax liabilities are established in favour of those who intend to acquire ownership of holdings and economic activities, with the aim of limiting the joint responsibility for tax obligations prior to the acquisition referred to in article 42(1)(c) of Law 58/2003 of 17 December, General Tax.
It is therefore essential to have good tax advice in order to avoid, as far as possible, inherit tax contingencies from third parties, outside our business, due to unwanted tax liability.
Pilar Ocasar Eusebio and Nuria de la Pezuela Puertas.
Technical Fiscal Department of Affiliation and Counselling.
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