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Weekly Report – 7th Novembre, 14

Business Over Tapas

By Lenox Napier and Andrew Brociner

martes 11 de noviembre de 2014, 18:08h

A digest of this week's Spanish financial, political and social news aimed primarily at Foreign Property Owners: with Lenox Napier and Andrew Brociner - For subscriptions and other information about this site, go to businessovertapas.com - email: [email protected] - ***Now with Facebook Page (Like!)*** Note: Underlined words or phrases are links to the Internet. Right click and press 'Control' on your keyboard to access.

Editorial:

Spain's political class, known increasingly as 'la casta', is losing support as reports of corruption steadily grow. Perhaps one of the most remarkable stories (as we wait for the Catalonian 'vote' this Sunday 9th, the next big name in the Partido Popular to fall and the fallout from the unexpectedly late CIS results – finally released on Wednesday afternoon – putting the 'indignados' group Podemos in first place in intention of vote followed by the PSOE and the PP in third), is the refusal, the second refusal from a prize winner in just three years, of Jordi Savall to accept a prize for the Premio Nacional de Música 2014 from the Minister of Culture José Ignacio Wert (letter of refusal here), a prize worth 30,000€. The Government, says Savall, has shown no interest in 'la cultura', besides increasing the IVA on it to 21%. Another musician, Javier Marías, refused the prize in 2012.

Housing:

From Property Showrooms: 'Despite being one of the countries hardest hit by the financial crisis, Spain has made a spectacular turn-around, dazzling financial markets across Europe. As former economic powerhouse Germany continues on a downward spiral, Spain has reduced unemployment (albeit modestly), seen GDP growth for the last few quarters and now the Spanish property market is bouncing from the bottom. Spain has had a booming summer, seeing growth in property prices for the first time in more than 6 years and also enjoying a record-breaking year for its tourism sector...'. A pinch of salt with this one?

'The United Left (IU) denounced today (Friday Oct 30th) that the Spanish Catholic Church registers as its own real estate properties of public domain and occupies thousands of facilities. The Federal Coordinator of the IU, Cayo Lara, announced that the parliamentary group of the left headed by his organization will promote the presentation of an appeal to the Constitutional Court so those properties are returned to the people.

The mortgage law of 1946 and the faculties given by the government of Jose Maria Aznar in 1998 allow the Church to register properties without presenting papers of ownership, as the institution is held in equal rights to an administration and priests are considered as solicitors...'. Found at Prensa Latina.

Hacienda helicopters have been over-flying properties across Spain in the search for an extra construction, room, terrace, pool or gazebo which had somehow escaped the owner's intention to report the additions to the catastro. Three million homes have already been inspected by the voracious tax authority. Already, letters have been mailed to those who have been 'caught' in over a thousand municipalities, explaining that they must put the record straight (and pay an introductory fine of 60 euros). More at El Mundo.

'Residential tourism has become a protagonist of the third day of professional meetings taking place these days in the Nordic countries to promote the Costa del Sol, in which Swedish authorities and experts are in agreement about this 'excellent' time to acquire a home...'. Says Inversión & Finanzas. (The report on Scandinavians buying up property makes no mention of the fact that many are "distressed" sales, notes a correspondent).

In Málaga, the PP are now presenting themselves as the friend of those who have an 'illegal home', according to La Opinión de Málaga. The President of the PP-A, Juan Manuel Moreno Bonilla, told mayors and some concerned citizens from the affected Axarquía area that the 10,000 owners of 'illegal homes' in Eastern Málaga could be sure of his party's support: 'not an amnesty, but a proper and just law'. He also noted the damage done to Andalucía's reputation, particularly in the UK thanks to the 'judicial insecurity'. A spokesperson for the SOHA, Mario Blancke, present at the meeting, said that his group was looking for some celerity on the part of the authorities in resolving this issue. Meanwhile, the General Secretary for Territorial Planning in Andalucía (now called 'Ordenación del Territorio y Cambio Climático'), Nieves Masegosa, has told a group of property lawyers and members of the AUAN in Almería that the Andalucían Government 'would sit down as many times as were necessary' with petitioners to 'accommodate' them within the parameters of the LOUA planning laws (found at Europa Press).

The Junta de Andalucía will demolish two more British-owned homes in Cantoria (Almería) on November 18th, according to a report in Europa Press. Madness.

'The face of many Spanish cities could change drastically from the start of next year when close to a quarter of a million stores, bars and restaurants will face closure after their rent increases by more than 1,000 percent, says UPTA, which represents the country’s self-employed workers and professionals...'. From an article at El País in English.

Tourism:

It's 'Always Warm' on the Costa del Sol. The 'Siempre Cálida' brand is being presented in London this week to attempt to increase the number of British visitors to Málaga. Supporting the campaign at the World Travel Market, fifty London taxis have been decorated with the Costa del Sol's slogan and logo.

Eight hoteliers are among the Forbes 100 richest Spaniards, according to this article.

Finance:

'Spain has made excellent progress towards slashing red tape and making it easier to do business in the country, a new World Bank report reveals, although there is still work to be done in areas including tax and contract enforcement. The World Bank Group’s Doing Business 2015 report looks at countries’ business regulations, including the ease of starting a business, paying taxes and trading across borders. A total of ten topics were examined in 189 global economies in the 2015 rankings...'. From The Local.

'The European Commission has improved its growth forecast for the Spanish economy by a small margin of 0.1% this year to 1.2%, but it has lowered its estimates for 2015 by 0.4%. It now predicts that in 2015 the GDP of Spain will grow 1.7% versus the 2.1% announced in its May report, and also forecasts that Spain will reach 2.2% in 2016...'. From Hosteltur.

The one hundred richest Spaniards are worth the equivalent of 15.6% of Spain's GOP, with 164,424 million euros between them (not including those values that, for one reason or another, have not been declared).

Politics:

The Metroscopia survey puts Podemos in front of the two main parties in intention of vote, says Euro Mundo Global. 'Indignation' is the cause of this topsy-turvy situation, with the PSOE in second place, in front of the PP. (Podemos 27.7%, PSOE 26.2% and the PP at 20.7%). The most important survey is the CIS, the Government controlled survey, which is late this month (it finally came out on Wednesday essentially confirming the figures published by Metroscopia)!

'The unstoppable rise of Podemos, Spain’s newest party, has sent the country’s main political forces into damage-control mode — not to mention into shock. One day after a Metroscopia poll for EL PAÍS revealed that the small, upstart party currently tops voter intention, ahead of the Socialists (PSOE) and the Popular Party (PP), both major groups have come to two main conclusions. The first is that Podemos’s unprecedented success is due to the repercussion of a seemingly never-ending series of corruption cases affecting the mainstream parties...'. The second conclusion is that they need to do something about it. The story comes from El País in English. Indeed, according to La Gaceta, the Vice-president Soraya Sáenz de Santamaría is said to have told some friends of hers that 'if things continue like this, we shan't even make it to the May (local) elections...'.

'The Podemos Express: What lies behind the extraordinary rise of Spain's new protest party?' - an article at Open Europe Blog.

Spain's business leaders have a plan to create wealth, jobs and employment reforms. The Consejo Empresarial para la Competitividad (CEC) – Spain's eighteen largest companies – says it could lower unemployment, currently creeping up again, to just 11% by 2018. Part of the plan would include an aggressive attack on the massive 'underground economy', which they say gives income to 875,000 people. Another idea is to reduce the number of municipalities in Spain into larger and more economical units. 'Fracking' says the CEC, should be allowed to produce gas and oil energy.

Would Mariano Rajoy bow out of politics before the next election, leaving – perhaps –Soraya Saénz de Santamaría as the logical candidate? Euro Mundo Global has the story.

Corruption:

The Corruption Map of Spain, courtesy of Europa Press, here. '1,900 accused, 170 condemned in over 130 different cases'. The European press have something to say too. El Huff Post quotes stories under the title (taken from the French Libération) 'Something Smells Rotten in the Kingdom of Spain'. The German and British press are also critical.

La Razón led its Sunday edition with the headline: 'Important court cases can take up to five years to be resolved'. Or longer. An example is given of the singer Isabel Pantoja, swept up in the Caso Malaya (Marbella corruption case) who has just been told to pack her toothbrush for a lengthy stay in jail. The case broke in early 2006, went to court in September 2010 and sentencing was given in April 2014, eight years later.

'The Supreme Court Public Prosecutor intends to ask the High Court Justice permission to take on the investigation into the former Presidents of the Junta de Andalucía Manuel Chaves and José Antonio Griñán, together with other ex senior officials currently under investigation by the Seville judge Mercedes Alaya in the case of the allegedly irregular ERE payments...'. Found at El Mundo.

The SGAE is the association which takes monies for playing music in public to share with the original song-writers. Scandal says that some of this fortune sticks to the fingers of association members. One ex-director of the SGAE is currently being tried for spending funds – 39,500 euros is mentioned – on putas in 2008 and 2009.

The Mayor of Barcelona, accused of having 12.9m euros in a bank in Switzerland (a story from El Mundo last week), has presented a letter from the Union de Banques Suisses to say that he has not, nor never had, an account with them. El Mundo trying one on just before the unofficial Catalonian referendum this Sunday?

When they do get sent down... they don't stay that way for long. Jaume Matas, the ex-President of the Balearic Islands, was imprisoned for traffic of influences for nine months back in late August, is now on '3rd Grade', which means he can sleep at home on the weekends.

The Anti-corruption Prosecutor is investigating 'irregularities' in desalination contracts along the Mediterranean coast from 2009 to do with a public company called Acuamed. The projects include plants in Carboneras and Cuevas de la Almanzora (Almería).

Catalonia:

'Campaigners demanding a vote on independence for the Catalonia region from Spain said Saturday they had gained the backing of two Nobel Peace Prize winners including Desmond Tutu. The South African archbishop and the Argentine rights activist Adolfo Perez Esquivel, both Nobel peace laureates, signed a petition calling for Catalans to be allowed "to vote on their political future", campaigners said...'. Found at The Local.

'The campaign promoting the November 9 vote on Catalan independence will continue despite a new legal challenge by the Spanish government, according to Convergència Democràtica de Catalunya (CDC), one half of the CiU bloc that rules the north-eastern region. “Even considering the worst-case scenarios, we are convinced that on November 9 we will be able to participate and express our opinion on Catalonia’s political future,” said CDC spokeswoman Mercè Conesa...'. From El País in English.

Meanwhile and perhaps coincidentally, soldiers based in nearby Valencia are being trained by the Military Police in crowd control techniques...

Tax:

'A total of 50 states and jurisdictions signed a multilateral agreement on the automatic exchange of tax information at the German Federal Ministry of Finance today, 29 October 2014. The signatory states have committed to sharing information about the financial accounts of taxpayers who are resident for tax purposes in a different country.
This high tax standard was developed in cooperation with the OECD. In their Berlin Declaration, the early adopters encourage other countries to join the agreement...'. From The Federal Ministry of Finance (Germany). The signatory states include Spain. El Mundo notes that the exercise is to control or stop banking secrecy, and also points out that many countries and off-shore havens including next-door Andorra did not join in the agreement. The routine interchange of banking information to begin in 2017.

A group of ex-emigrants, now back in Spain, organised as La Asociación de Exemigrantes Jubilados (Aexju) is aggrieved with Hacienda over tax-claims for their past income from abroad. Hacienda has more plans than this, with new rules regarding pensions from abroad for all beginning from next year. This story comes from La Verdad.

Google Tax:

The new Law of Intellectual Property (LPI), of which the 'Google Tax' is a part, was passed by the Government and will become law from January 2015. Gizmodo explains some of the drawbacks for the citizenry. This includes 1. Limiting your access to culture. 2. restricting your right to information. 3. The possible closure of your company and 4. It'll cost you more to study at university. Apart from Google News, Yahoo News, Menéame and other aggregators (potentially including Facebook etc), who will be obliged to either pay up, close down or move abroad, Business over Tapas, as a news-letter rather than a web-page should be OK (time and experience will no doubt tell).

'Perhaps the most intriguing question about the "Google tax" introduced in Spain is whether there is a workable way to limit or tax the spread of information on the Internet. I suspect there isn't, and Spaniards are about to find that out the hard way, as some Germans and Belgians did before them. According to Spain's new copyright law, services that post links to news articles or excerpts from them will have to pay a fee to the Association of Editors of Spanish Dailies, a group that represents the country's news industry, or face a 600,000-euro ($751,000) fine...'. From Bloomberg.

'The Story of Spain's Google Tax', a full breakdown from Weblogs in English here. A quote: 'To oppose this new proposal, an organization called Coalición Pro Internet has been created. It logically includes Google (which in Spain till now had only done secret lobbying and no public activism) and Menéame, but also AEEPP, the largest association of Spanish newspapers, Adigital (the association of Spanish internet companies), and noted digital-only publishers like Weblogs SL (my own company), eldiario.es, ADSLZone, Hipertextual and many others. A report it commissioned estimates the law’s damage to Spanish Internet industry at 1.1 billion euros. Facebook and Twitter, although invited, did not participate in the Coalición...'.

Those pesky 'Anonymous' hackers got into the lead web-page for the AEDE, the association of daily newspapers (the ones who will benefit from any monies skimmed from page-sharers or aggregators after the New Year). Well, they did!

Various:

It looks like Lluis Llach's 'L'estaca' is the new song of the Revolution! Found at YouTube.

From The Local comes the disturbing news that 'Sources inside Spain's military have reportedly told a Spanish newspaper that only a handful of the country's Eurofighter Typhoon jets are fully operational and that semi-retired F-18 aircraft are being called back into full service to meet NATO commitments. According to Spanish daily El Confidencial Digital, unnamed military sources have warned that the Eurofighter Typhoon air fleet is crippled by breakdowns, lack of spare parts and delayed inspections...'.

The Chinese were the second largest group of non-European immigrants to obtain residence-permits in 2013, beating out the South Americans and standing only behind the Moroccans. Graphics here.

A disturbing 24% of young Andalucians think that a woman's place is in the home, according to a study published by the Instituto Andaluz de la Juventud. More here.

A Canadian writer, living near the infamous Calle Montera in down-town Madrid, interviews a Bulgarian 'working woman' – one of many of those who are very much in evidence to any passer by. The article, at Vice, is in Spanish.

'Few visitors to Ceuta, Spain’s exclave on Morocco’s Mediterranean coast, ever venture into the Príncipe Alfonso district. Home to the city’s poorest inhabitants (all of them Muslim), lacking the most basic amenities and crippled by 90-percent unemployment, it’s a third-world slum dominated by rival drug gangs fighting each other to control a trade that has moved away to Tangier. “It’s a pressure cooker that could blow at any time,” says a member of the Spanish security forces. “This is Spain, but it isn’t Spain. Quite simply, there is no law here, the state is absent.”...'. From El País in English.

A nice travel report from Journey to a Dream introduces us to an interesting town in Galicia. 'The town of O Barco (The Boat) is located in the province of Ourense in Galicia. It lies in the foothills of the Sierra de la Lastra mountain range, in a comarca (traditional region) known as Terra de Valdeorras. As the town is some 130 kilometres from the sea, it seems reasonable to assume that it derives its name from an ancient river crossing rather than any seagoing vessel...'.

An old amateur film from the fifties, in French, includes views of Moraira and Benidorm...

Letters
Hi Lenox,

Re the 720 Declaration, petition to mitigate penalties, referred to in last weeks ‘Business over Tapas’.
Any chance of a petition asking that the law actually be imposed, so that the estimated 95% who should have made the declaration, but did not, now will do so? I suspect they may have a lot of questions to answer about where their assets came from and why (if they have not done so) they have not previously paid the tax in Spain due on them.
I have not seen any prosecutions for failure to declare, so I do not know if the severe penalties, available (minimum 10,000€ fine) have been imposed in the trivial circumstances (typing errors etc.) described in the petition.
John

Has any Reader heard of any situation where offenders have been pursued or punished as a consequence of the Asset Declaration exercise?

*Attached is a draft of a briefing paper we hope to send to the ECAS and possibly to the Petitions Committee Secretariat in the next day or so. I will try to shorten it and take into account any suggestions received. I’m not sure the petition near the end needs to be included here. It has been slightly revised in the version that will be before the Committee.
Grateful for comments and suggestions as soon as possible. For anyone not aware, the session of the Petitions Committee that is to deal with this is scheduled for the morning of November 11.
Again to remind, our association is responding to requests for help on this issue due to our past experience with the EU Parliament and Commission on other matters. (from AUN www.abusos-no.org)

Finally:

Beautiful photos of the spring Córdoba Flower Festival at Amusing Planet. 'Every spring, in the beginning of May, the city of Cordoba, in southern Spain, bursts into bloom with special festivities as the city launches into its spring celebrations. It starts off with a parade known as the “Battle of the Flowers”, followed by the much anticipated Patio Contests called “Los Patios de Córdoba” or “Fiesta of the patios”. During the next two weeks, the people of Cordoba throw open the doors to their private patios as a fierce competition for the most beautiful patio ensues...'.

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