Weekly Report

Business over Tapas (Nº 261)

Business over Tapas (Nº 261)

  • A digest of this week's Spanish financial, political and social news aimed primarily at Foreign Property Owners: With Lenox Napier and Andrew Brociner. Consultant: José Antonio Sierra

viernes 22 de junio de 2018, 03:14h

By Lenox Napier and Andrew Brociner. Sent by José Antonio Sierra

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Pedro Sánchez appears not to be enjoying the usual hundred days afforded to new leaders in Spain, at least by the Media and the opposition parties – but the voting public however appear to like him. His cabinet – usually these things can take a month to resolve – was chosen in just a few days, and already one of his ministers has fallen on his sword. The Ministry in question – leading an oxymoron called ‘Culture and Sports’ – had been given to a journalist who said that he neither liked los toros (culture) nor indeed ‘any form of sporting activity’ (here and here). He also quickly employed Daniel Espín, the right-hand man of the ex-minister Ángeles González Sinde (we remember her as being in favour of protecting the main daily newspapers and their AEDE union from ‘illegal copying’ and aggregation) as his second in command. Anyhow, an independent newspaper found that Màxim Huerta, after only a week in the job, had defrauded Spain’s Tax Agency of some €218,322 back in 2006. He quickly resigned. (The joke doing the rounds was that he had only been given the job to please conservative supporters). The new man is José Guirao, the erstwhile director of the Museo Nacional Centro de Arte Reina Sofía (Wiki) – who evidently has no relationship to sports either... (He also doesn’t like los toros - El Mundo thinks he should resign).

Aside from this strike to the cabinet, it was noted that the new Sánchez appointments had a higher proportion of women than any other country in the world.

Three of the new ministers, who were deputies in Parliament, have been obliged to permanently renounce their second job, and to be exclusive in their new position.

Furthermore, there will be ‘no early elections’ – which will bring us to 2020.

Over on the other side of the House, Mariano Rajoy has now left politics altogether and has returned to Santa Pola in Alicante to take up his old job at the Registro de la Propiedad.

Meanwhile, the leadership of the Partido Popular now appears to be between María Dolores de Cospedal and Soraya Sáenz de Santamaría (since Alberto Núñez Feijoó has dropped out), plus several other minor pretenders: Pablo Casado (who’s Master’s was also in doubt during the recent Cifuentes crisis); the ex-minister (‘Motormouth’) José Manuel García Margallo; a deputy called José Ramón García Hernández and the ex-leader of a PP youth organisation called José Luis Bayo (here).


A promising article hides behind a pay-wall at Diario Información. ‘Political instability in the EU threatens the reef of residential tourism on the Costa Blanca. The sale of second homes moved 5,000 million euros in 2017 by benefiting a whole pyramid of activities linked to the service sector. The foreign buyers are vital to continuing to keep the Spanish real-estate market moving...’.

From Wolf Street here: ‘Private equity firm Blackstone, the undisputed king of property funds, continues to bet big on global real estate. ... It was given the green light to acquire Spain’s biggest real estate investment fund Hispania, for €1,900 million. The move, after its prior acquisitions, will cement its position as Spain’s biggest hotel owner and fully private landlord. Hispania’s 46 hotels, added to Blackstone’s other hotels, will turn the PE firm into Spain’s largest hotelier with almost 17,000 rooms, far ahead of Meliá (almost 11,000), H10 (more than 10,000) and Hoteles Globales (just over 9,000)...’.

Holiday rental property owners advised on the taxes they are liable to pay at Murcia Today.

Some tiny places to rent in Madrid can be seen on a video from LaSexta here. ‘...in some parts of Madrid and Barcelona, there is fifty times more demand than offers available...’.

From The Guardian: ‘Six members of a collective that resettled an abandoned Spanish village are facing prison after being found guilty of illegal occupation. The tiny village of Fraguas, which sits in the hills of northern Castilla-La Mancha, was emptied in the late 1960s as part of a reforestation programme and was later used as a training area for the Spanish army.’

‘The PP demands an "immediate solution for irregular housing in the face of the chaos" of the Junta de Andalucía. The president of the PP-A, Juanma Moreno, has demanded that the Regional Government of Andalucía "offer an immediate solution to the situation of irregularity suffered by more than 50,000 homes in the province of Málaga in the face of the regulatory chaos of the Andalusian Government in urban planning,". He warned the Andalusian Government that this is a problem that must be solved now. La Vanguardia reports here. The PP guarantees to work hard to find a solution on a visit to Olula del Río in Almería where they met AUAN members here. The Junta de Andalucía has only managed to ‘regularise’ 25,000 ‘illegal homes’ in the past fifteen years says the ABC here.

Note from Maura Hillen, president of the AUAN (here):

After having spent the last two years fighting to finish the regularisation of houses that were built illegally and later sold to innocent buyers in the Valle del Almanzora, I have come to the conclusion that the autonomous government is not willing to finish solving this problem in a sensible way any time soon – in spite of the important steps that it initially took.

The problem is that the reform of the Planning Laws (LOUA) in 2016 excluded the regularisation of thousands of houses in the Valle del Almanzora, and I believe hundreds of thousands of houses in Andalucía. We warned them about this at the time but they didn´t listen. This reform permitted irregular houses on parcelaciones, that is to say groups of houses sharing the same plot of land, to access services and to be registered at the Land Registry, but the reform created a sub-species of parcelación which was called an “asentamiento”, that was left out of the reform. These houses on asentamientos are condemned to a lengthy treck via the labyrinth of municipal planning because, according to the autonomous government, these houses must be transferred onto urban land via a Town Plan.

It is said that those who broke the law must not be rewarded, and that they must contribute to the urban planning costs, and that these houses must be integrated into the urban grid of the town. Sounds good in theory but in practice this attitude is damaging. In this system, the promoter who constructed the irregular houses and sold them to third parties, and who continues to own land on the asentamiento (as is usually the case), is graced with new urban land, multiplying its value. Not only that, but the buyers of these houses are forced to pay a large part of the urbanisation costs, which the promoter should have paid. Moreover, to integrate the asentamiento into the urban grid, the land between the asentamiento and the town centre is usually reclassified as ‘urbanisable’ land, possibly awarding the promoter again if they own this land. Over and above all this some promoter will have to construct the general infrastructure and get paid for it.

In contrast, the only thing that we are proposing is a little bit of common sense – not an amnesty. We leave the giving of an amnesty to law breakers to others. We are only asking for the minimum recognition for these houses, that the administration allowed to be constructed and sold to innocent third parties, so that they can access services and register them at the Land Registry via what is called an AFO. At the end of the day, that which has been permitted and now cannot be demolished, must be regularised, minimising its environmental impact, and the sooner the better. This is what is already happening with parcelaciones, because there is no real difference between houses on parcelaciones and houses on asentamientos in reality.

And don´t be fooled, an AFO is not a legalisation; it is much less that a license of first occupation. Giving an AFO to these houses is not a privilege because, among other things, the house must satisfy environmental considerations as part of the process of conceding the AFO, and fees and costs must be paid. In contrast, the effect of the system devised by the current administration, and the one it wishes to maintain, it to multiply the effect of the irregularity on the environment, with new urban land and new houses, and to award the law breakers who were allowed to build these houses, something that in my opinion is neither sensible nor fair.

*The edited article can be found in Spanish at La Opinión de Almería here.

From Ideal, Jaén: ‘Justice reactivates dozens of demolitions of villas halted for years by the PGOU. The Public Prosecutor's Office has requested the execution of numerous pending sentences and a court has already given three months' time for the first of the demolitions’.


‘The bubble began to lose air in the fourth quarter of 2017, when the Catalan political instability punished the arrival of international tourists and overturned the forecasts of over 84 million annual visitors. Even so, the year ended with almost 82 million international tourists, surpassing the extraordinary record set in 2016 and placing Spain as the second largest tourist destination in the world, second only to France. "The normal behaviour of a mature destination such as Spain is an annual growth of between 2% and 4%; growth of close to or above 10% as in the last two years are extraordinary cases," says John Kester, director of the statistics and trends programme of the World Tourism Organisation, a UN agency...’. More at La Vanguardia here.

To cheer us up – a piece from The Local: ‘Authorities scoop ELEVEN tonnes of jellyfish from Costa del Sol beaches’


Euthanasia is now to be discussed in Parliament. The PSOE wants to legalise and institutionalise it within the Spanish health service. 20 Minutos has the story here.


‘Even the abrupt ouster of Prime Minister Mariano Rajoy this month couldn’t shake investors’ faith that Spain’s recovery is real, whereas Italy’s looks increasingly fragile. Yields on Spanish government bonds are about where they were before parliament voted Rajoy out of office on June 1. The Mediterranean countries’ divergent fortunes are reflected in the spread between their 10-year sovereign debt, which is the widest since 2012. The labour market overhaul that Rajoy’s government initiated in 2012 helped lay the foundation for the economic rebound, though the reform push stalled after his centre-right party lost its majority in 2015. The new premier, Pedro Sánchez of the Socialist party, is friendly to markets on the whole, though he wants to strengthen the bargaining power of unions. “This healthy growth is going to continue,” says Ignacio de la Torre, chief economist at Arcano Partners, a boutique investment bank in Madrid. “The Spanish economy is immersed in a virtuous circle of falling unemployment, recovering salaries, rising consumption, and positive trends in the real estate sector.”...’. More at Bloomberg here.

‘An official report certifies the distressing financial situation of Spain's welfare state. The Social Security fund and its managing bodies went into technical bankruptcy for the first time in 15 years, after accumulating more than 76 billion losses since 2010, according to the latest report sent to the Cortes by the Court of Auditors on the General State Account for 2016. The assets held by the Social Security fund (TGSS) no longer exceeded its liabilities in 2016, according to the Court of Auditors, which has not yet closed its analysis for 2017, when a new deficit was recorded in the system. For the time being, "the balance sheet of the managing entities and the TGSS includes, at 31 December 2016, a negative net worth of 176 million euros", states the audit body. This is the first time since 2001 and this means that if they were private companies, the TGSS and the managing bodies from the INSS to the Imserso would be bankrupt and in the process of being dissolved...’. The report comes from El Mundo here. The government is considering introducing some extra taxes to finance the pensions shortfall (here).

‘As the European Union requires, the AVE is not eligible for any subsidy. But the AVE is merely a brand name - not a type of train - that runs on long distance journeys, so it would be more accurate to say that the AVE in Spain is not subsidised, but high speed trains are. What kind of high speed? We are talking about the Avant or, in other words, a medium-distance and high-speed service, which covers distances of a maximum of 200 kilometres and which has been a leak for Renfe Operadora since it opened in 2006...’. The details can be found at El Independiente here.

The toll routes in Spain will be dropped on their return to public ownership as their concessions run out – several at the end of next year says El Mundo.

‘Amid plans of further reducing real estate exposure in Spain, Banco Bilbao Vizcaya Argentaria, S.A. BBVA has agreed to sell its €1,000 million property loan portfolio. Per a Reuters report, the portfolio is being sold to the Canada Pension Plan Investment Board, which invests the assets of the Canada Pension Plan. The bank, the second largest in Spain, has been striving to reduce the non-performing assets from its balance sheet as the property market in Spain witnesses a rebound...’. From nasdaq.com here.

‘The annual expenditure of Spanish households on electricity in 2017 stood at 745.9 euros, according to data from the Encuesta de Presupuestos Familiares (Household Budget Survey) published on Wednesday by the National Statistics Institute (INE), which reflects an increase in the price of this item of 55.6% over the last decade...’. Found at El Diario here.


‘Spain’s new government is working on a Bill of Law, or Royal Decree that will once again make free healthcare universal for everyone living in the country, irrespective of their legal status. The previous right-wing PP-led government stopped healthcare for anyone who was not legally resident, except for emergency treatment, all care for the under-18s and for pregnant or post-partum women, back in 2012. And hospitals and clinics did not always have the same criteria as to what constituted an emergency. An overwhelming number of doctors defied the ruling, which they said was 'cruel' and 'leaving people to die or stay ill', and continued to treat anyone who walked through their surgery doors without asking questions...’. From Think Spain here.

Spiriman, the media-savvy social service doctor from Granada, remains a massive thorn in the side of Susana Díaz. Last week he orchestrated a large protest in the streets of Seville against cuts in the health system. Digital Sevilla reports 60,000 protesters here (plus video).

Required readingTim Parfitt on Catalonia and Spain ‘Whilst I’ll never win the €12k offered by Spain’s previous Foreign Minister, Alfonso Dastis, to write the most positive things about Spain (if the reward still exists now that he’s no longer in the job), I feel there’s been a mix of good and bad news during the past week, so I’ll try and highlight some, er … positive things. Always look on the bright side of life...’.


Pedro Sánchez will meet Quim Torra on July 9th in Madrid, says El Mundo here.

Headline from El País in English: ‘Madrid lifts spending controls on Catalonia region. Spain’s new Socialist government says decision is aimed at normalizing relations with Catalan authorities’

‘The Ciudadanos leader Inés Arrimadas resigns her privileges as leader of the opposition in the Catalonian Parlament’. The story at El Español here.

From Vilaweb in English here: ‘The new foreign minister of the Catalan government intends to “immediately” reopen the offices in large cities abroad that were closed down by the Spanish government after it suspended Catalonia’s self-rule. During an official visit to Brussels on Thursday, Ernest Maragall spoke about the urgent need to restore Catalonia’s representation abroad in cities such as London, Rome, Berlin, New York, Washington, as well as the one in Switzerland...’.


From The Olive Press: ‘The Gibraltar government has said it will not reconsider its anti-abortion laws despite Ireland’s recent landslide vote to repeal its ban. Pro-choice campaigners had hoped it would put pressure on the Rock, but it seems their fight won’t be over any time soon. A Gibraltar government spokeswoman told the Olive Press: “We have already dealt with progressive issues like civil partnerships and equal marriage… The Cabinet has not considered changing this [abortion] policy.”...’. The act is punishable by life imprisonment on the Rock under Section 162 of the 2011 Crimes Act – the harshest abortion laws in Europe.


The State has wasted more than 45,000 million euros in the past twenty years on ‘unnecessary structures’, says a group of university economists as reported in El Diario here. From El País in English comes: ‘Is Spain squandering money on public infrastructure projects? Report says yes. New study finds signs of wasteful assignment of funds for high-speed rail, roads, airports and more’.


From El Independiente: Could the new minister of Justice give Judge Baltasar Garzón his job back? The PP is preoccupied, as Garzón would be in a position to give them plenty of political problems...

‘Inaki Urdangarin, the Spanish king’s brother-in-law, has been jailed after the Supreme Court rejected his appeal. He was sentenced to five years and 10 months of prison time for embezzling nearly six million euros between 2004 and 2006 from a non-profit foundation he headed on the island of Mallorca...’. From The Olive Press here.

‘Cristiano Ronaldo accepts two years in prison and pays Hacienda 18,800,000 euros. The Portuguese player has reached an agreement with Hacienda, recognizing four tax offences. The Real Madrid star has managed to drop the fiscal fraud attributed to him from 14.7 million to 5.7 million euros...’. With two years prison, he won’t do ‘any time’. 20 Minutos has the report here.

The General Council of the Judiciary (the political wing of the Judiciary) has opened proceedings against Judge Mercedes Alaya for her criticism of judges and prosecutors. Alaya is the stern woman who investigated the Andalucía ERE case before being summarily removed in 2015. The story at El Español here.


Who's in charge? ‘Citizens rights expert: “Until it’s happened and certain they don’t want to deal with it”

We all know we need to get new paperwork. But exactly how, where and when is not clear for anyone in the dozens of British EU expat communities.

Questions like what documents will be needed, what the procedure will be, how much it will cost and how long it will take are causing headaches for British citizens from Porto to Plovdiv. A recent report titled 'Next Steps: How to get a good Brexit deal for British citizens living in the EU-27' (here) suggests the EU hasn’t even agreed who should be in charge of the process, let alone how it should be done.

“What people want to know is what to do,” Dr. Michaela Benson, a sociologist at London’s Goldsmiths University and the report’s author, told The Local, summing up the frustrations of EU citizens in the UK and Brits in Europe.

The 35-page analysis, which features interviews with stakeholder EU officials and was co-authored by the Migration Policy Institute (MPI), looks at how prepared Member States are to role out a smooth process for British nationals to get residency in their host country after Brexit.

“The confusion stems from the fact that it is not clear whether EU citizens living in the EU27 will be treated as third country nationals or not,” Dr Benson said. In other words, whose remit will British citizens in Europe fall under?

The issue relates to who should be in charge of the logistical procedure of how British citizens in the EU will demonstrate their right to residency. Will it be national agencies or an EU-wide standardised effort run from Brussels? Where does the competence lie, even at a national level?

Given there is no precedent, EU governments have been left scratching their heads as what to do. “Until it’s happened and certain they don’t want to deal with it,” adds Dr. Benson. The Goldsmiths sociologist says that British citizens are not considered a “political issue within the EU politics of migration” and that many EU nations are simply taking a wait-and-see attitude.

As one official states in the report: “We still do not know what the rules will be in the end, so we cannot answer the questions very concretely.”

The delays continue to anger citizens’ rights groups. “To date we have seen more energy spent on discussing the post-Brexit movement rights of jam than we have of people. This needs to change,” Jane Golding, chair of British in Europe – the grass-roots movement for the rights of British citizens in Europe – said last week. From The Local (newsletter).

‘When? Let’s Start with ‘When?’. From Lenox Napier here.

Those who take Spanish nationality must renounce that of their own country. Now, it seems, the civil registry in Barcelona is making sure that those who take nationality locally are going through with this formality. Para Inmigrantes has the story here.


Some of the ‘fake news’ about the new Government of Spain is recorded by Maldito Bulo here. Don’t believe everything you read (unless it’s at Business over Tapas, ¡claro!)


Frank Cuesta is a popular TV guy who does animal shows. He drops one at El Español here on the 'animalistas'. With video.

Spain is not afraid of littering (unfortunately) and we look gloomily at the campo and the road-side with its trash strewed artlessly about. Why not take it home again? The beaches - often covered in detritus from the bathers - are (at least) usually cleaned daily by the local councils (at a cost to the taxpayer). The sea, according to Público, is nevertheless full of plastic and other waste. ‘Spain, the second country in terms of plastics dumped in the Mediterranean after Turkey’. Here.

An elderly Briton has been arrested in La Manga, Murcia, responsible for starting a number of brush fires last summer says La Opinión de Murcia here.

Coca Cola paid 146,688€ to the Fundación Española de Nutrición in 2017, says a site called Cúantos Calorías Tienen which looks at sugar intake by Spaniards here.


The new mini-radar speed traps have now been scattered across the Spanish network of roads. There are sixty of them worth 220,000€ a day to the DGT, and 57 have been identified and located by SocialDrive – a useful telephone app. El Español has the story (and their current locations) here. Google Maps shows all speed radars, says 20 Minutos.

There’s a clever (?) businessperson in Ibiza renting out bed-space on bunks set up on his terrace in Ibiza – at 25€ a night... Antena3 invites us to have a look.

While Iñaki Urdangarin has chosen his preferred jail to spend his sentence in – a woman’s jail in Ávila called Brieva (he has his own private quarters), Spain’s five most notorious and dangerous jails are listed at El Español here. These are Estremera, Soto del Real, Morón, A Lama and Albolote.

‘Pedro Sánchez has vowed to move the remains of Dictator Franco from the Valley of the Fallen and turn the site into a monument of reconciliation. Spain’s new prime minister revealed plans during his first TV interview to turn the vast mausoleum into a ‘memorial about the fight against fascism’, adding that the country ‘cannot allow symbols that divide Spaniards’...’. From The Olive Press here.

Those who love magic and card tricks will know Juan Tamariz. ‘...With a top hat that is never quite able to contain wild unkempt hair, a crazy manic disposition, and an enchanted violin that plays at the successful completion of every trick, he is one of our era's most revered creators, performers and thinkers—most notably in the field of card magic. Along with co-hosts Pedro Reyes and Alaska, Juan starred in a television series, Chan-tatachán, which ran in Spain from 1992 to 1993...’. Magicana says that eighteen hours from the series are now available at The Screening Room here. Wonderful!

An interview with Carmen Montón at El Diario. ‘"Let's make it clear that homeopathy has no scientific evidence, that it's not science and that it doesn't cure". The new Minister of Health, Consumer Affairs and Social Welfare considers it crucial to recover the rights affected by the cuts and places universal attention and dependency as core issues’.

The mayor of Pamplona wants to open a discussion about banning bullfights in his city. This may cause Pamplona to take ‘a hit’ in its tourism. El Confidencial reports here.

The truth about pop music – how to write a hit. A YouTube presentation/exposé by Jaime Altozano here.

From See Beyond: ‘When Fidel Castro helped a Madrid suburb secede from Spain’. A nice little tale about the Independent Kingdom of Cerro Belmonte Here.

Molly at Piccavey writes that ‘Expat life in Spain can be an adventure and a new start. After the settling and the novelty of life abroad has waned. The daily routine can sometimes be a little more challenging. From Spain Visa & Residency challenges to learning to speak the local language. Here are some of my tips after living abroad for 20 years...’.

See Spain:

Expansión brings us ‘Some of the most beautiful medieval villages in Spain’ (and their hotels) here.

Mike Arcus is back with ‘Andalusia, the road less travelled, part 6 – Arcos de la Frontera, a mini Ronda and a mountainous park’. Here. This series of articles from Mike, with its stunning photography, is highly recommended.


‘La Inquisición’ – A video on YouTube explains the Spanish Inquisition here.

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