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Profession of lawyer in Spain. Regulation, registration and fees quotation

1.- The concept of “Bar Association” and how to be a lawyer in Spain 

– Spain – “Colegio de Abogados”

In Spain, lawyers must register with a “ Colegio de Abogados ” to be able to practice their profession. Bar associations are professional institutions that represent lawyers and regulate the practice of law.

In Spain there are 83 Colegio de Abogados , one for each province and one for the Autonomous City of Ceuta and one for the Autonomous City of Melilla. The bar associations are grouped together in the General Council of Spanish Lawyers (“Consejo General de la Abogacía”), which is the representative body of the Spanish legal profession.

To be able to register in a bar association, the lawyer must meet the following requirements:

Once a lawyer enrolls in a bar association, he or she acquires the status of “ registered lawyer .” The registered lawyer has the right to practice law throughout Spanish territory.

Bar associations have the following functions:

Colegio de Abogados are a fundamental piece of the Spanish judicial system. Bar associations ensure that lawyers meet training and professional ethics requirements , and that citizens have access to quality legal defense.

– France – “ Barreux ”

In France, bar associations are called “ Barreaux ”. There are 161 Barreaux in France , one for each judicial district . To practice the profession of lawyer in France, it is necessary to be registered in a Barreau .

The “ Barreau ” is a professional organization that represents lawyers in its judicial district . It is responsible for ensuring the ethics and discipline of the profession, as well as providing services to lawyers, such as training and legal assistance.

To register in a “ Barreau ”, lawyers must meet the following requirements:

Once registered with a Barreau , lawyers have the right to practice the legal profession throughout France.

The National Council of Bar Associations (CNB) is the national institution that represents all the Barreaux of France. The CNB has the responsibility of establishing the deontological rules of the profession, as well as supervising the operation of the Barreaux .

– Germany – “ Rechtsanwaltskammern ”

In Germany, lawyers register with bar associations, which are called “ Rechtsanwaltskammern ”. There is one bar association for each federal state of Germany, plus one for the Federal Supreme Court of Germany.

In order to practice law in Germany, lawyers must be registered with a bar association . Registration takes place after the lawyer has passed the two state law exams and has met the requirements for practical legal training .

Bar associations have several functions, including:

Bar associations are autonomous organizations governed by the Federal Lawyers Law (BRAO) .

– United Kingdom (UK)  – “Bar Council” or “ Law “Society ”

In the United Kingdom, the legal profession is divided into two main branches : barristers and the solicitors .

The Barristers are the lawyers who act before the courts , while the solicitors They are lawyers who provide advice and representation to clients in legal matters.

Barristers check in at one of the four Inns of Court : Gray’s Inn , Lincoln’s Inn , Middle Temple and Inner Temple . The Bar Council of England and Wales It is the regulatory body for barristers .

Solicitors register with the Law Society of England and Wales . The Law The Society is the regulatory body for solicitors and also provides services to its members, including training, professional development and legal support.

In addition to the Law Society of England and Wales , there are other bar associations in the United Kingdom that represent lawyers from certain regions or areas of practice. For example:

– Belgium

In Belgium, lawyers have to register in a “ Barreau ” of lawyers to practice their profession. There are twenty-five “ Barreaux ” of lawyers in Belgium, divided into two groups:

Bar associations have the function of ensuring the ethics and professionalism of lawyers, as well as representing lawyers before judicial and administrative authorities.

– The Netherlands – NOvA

In Holland, lawyers have to register with the Nederlandse Orde van Advocaten ( NOvA ) , which is the Dutch bar association. NOvA is a professional organization that represents Dutch lawyers and ensures compliance with the standards of the profession .

To register with NOvA , lawyers must meet the following requirements:

Once lawyers meet the requirements, they can apply for registration with NOvA . The NOvA will review the application and, if approved, the lawyer will be able to begin practicing law in the Netherlands.

NOvA also offers a number of services to its members, such as :

NOvA is based in The Hague .

– United States (USA) – “Bar Associations ”

In the United States, the bar associations or associations where lawyers must register to practice their profession are called Bar Associations . Each state in the Union has its own Bar Association , which is the body in charge of regulating the practice of law in that state.

In order to practice law in the United States, a lawyer must be admitted to the Bar Association of the state in which he or she wants to practice. To do so, you must meet the requirements set by the Bar Association , which typically include obtaining a law degree from an accredited law school , passing a Bar admission exam , and completing a period of supervised practice.

The American Bar Association (ABA) is a national bar organization that has no jurisdiction over state Bar Associations . However, the ABA sets educational and ethical standards for law schools and attorneys, and its recommendations are typically followed by state Bar Associations .

Bar Associations perform a number of important functions, including:

Bar Associations also play an important role in defending civil rights and social justice.

 

2.- Why using a lawyer when buying a property in Spain? 

 Why should you use a lawyer in the process of buying a property in Spain ?. Notary and lawyer/solicitor in the process of buying properties in Spain.

The Spanish buying process is very similar to other countries. Foreign investors in the Spanish system will find many similarities with their home countries.

But, however, also we may find many differences.

The most notable difference is the position and functions from the lawyer and the notary functions.

I.- Some examples of lawyers’ assistance in property transactions in other countries:

Property transaction (“Conveyance”) in UK

In the British buying and conveyance process (“Conveyance”), the notary is not involved at all in the process of a property sale. Seller and buyer are assisted in the transaction with the help, each one of them, with their own lawyer.

Then, the buyer’s lawyer, and the seller’s lawyer, are the ones who, from the first steps up to completion take control of the sales process, doing and completing the change of name of the property, and the payment of the price, taxes, etc. Both solicitors are the ones who made the contracts, take care that each party fulfils its obligations, payment of taxes, they organize and receive payments and complete the registration of the property to the new owner, etc.

As conclusion: Notary does not take part on the British property transaction system of buying and selling properties, and there are two lawyers/solicitors, one on the buyer, and the other by the seller, who participate in all stages of the process.

Property tranasctions in the rest of European countries – France, Belgium, Germany, Netherlands, etc. 

In these countries, on the properties’ buying/sale process, the presence of the notary is essential. Notary does everything.

Unlike the British system, in the continental system, both parties, buyer and seller, use the notary, as the intermediary of the transaction, from the very beginning to the end, and he makes the following:

  1. Approximation of  parties, and the formalization of the transaction by contract.
  2. Control of the fulfilment of each party ‘s obligation.
  3. Performs of legal, administrative and tax research of the property.
  4. Urbanistic and construction research of the property.
  5. He makes and receives all the payments from the sale.
  6. Complete the deeds of sale.
  7. Complete the registration in the land register on behalf of the new owner.
  8. Report and pay taxes from the purchase and sale
  9. Make the change of the contracts of supply of water, electricity, local taxes, etc.

 Conclusion: The function of the LAWYER in the buying/selling process in these  countries is zero. Lawyer is not involved in this process, except when there is litigation resulting from judicious litigation.

 II.- The lawyer’s assistance in the Spanish buying and selling process 

It can be said that the process of buying Spanish is a mix between the two systems considered: The “British” and the “Continental”.

Spanish notary vs Spanish Lawyer

In the Spanish property transaction process, the notary is really important, but not enough to make a purchase with total guaranties and security. The presence of the Spanish notary in the purchase process is essential because, like other countries such as France, Belgium, Holland, etc. , the sale cannot be registered in the land register without having gone through the formalization of notary acts (or  escrituras”).

The notary also checks essential information such as:

But unlike the “Continental” notaries, the Spanish ones does not do more than the functions mentioned. That is to say about the functions of the Spanish notaries:

Unfortunately, there are cases in Spain where the buyer has completed the purchase without the assistance of a specialized lawyer, with a perfect notarial formal process, and perfectly recorded in the cadastre and the land register. So, formally perfect. And then, after the purchase process, he found that there was missing a license or certificate of occupation (“certificate of habitation”), or even had an expropriation order for a highway project, for example, or that the property had urbanization charges, or part of the plot must be given or lost to the administration for extension of a public road, etc .

This lack of planning study by the notary creates particular problems in the following properties:

– Properties in urbanizations: For example, the builder did not complete the urban development, and the urbanization infrastructure, and then, there are works of urbanization without finalizing, which must be completed, and paid, sometimes, by the owners.

– Properties, houses, or villas in rustic areas or COUNTRYSIDE: These properties are generally in the rural area and outside the urban areas. These properties, typically villas or vacation homes can have problems such as:

– Villas and apartments in old housing with serious infrastructure problems or pending the development of project or improvement, etc.

 The above information will not be obtained by a notary in Spain.

Unfortunately, in Spain, legal, administrative, and planning information affecting the property, are not condensed into a single point of information, as it should be the land register. In Spain, the information in the land register, although essential, is not complete.

The information contained in the Property/Land Registry in Spain does NOT collect ALL the necessary information that affects the property.

At our firm, customers sometimes ask us the bank account of the notary to make the payment of the purchase price, and are surprised when we inform that in Spain, the notary does not receive payments, and that payments must be paid directly to the seller, or his lawyer, or to the real estate agents.

As lawyers, we have seen many situations where sellers have discovered that even their deeds were not registered at the Land Registry.

At the time of the purchase, current owners went to the notary, and once the purchase was completed, and being confidents that the notary would make the necessary actions to complete the registration steps, they did not instruct the notary to act the registration in the land register. So, the notary never did it!. Therefore, over the years, have found that the properties were still on behalf of the previous owners, because he did not give the order to the notary, and were not assisted by a lawyer in your process.

Also, notary does not arrange the domiciliation of the payment of these services in the bank account of the buyer by direct debit.

Real Estate agents vs Spanish lawyers

The activity of the real estate activity is starting to be regulated in Spain, with the exigence to be registered in a “Real Estate Association”. Depending on the different regions in Spain, real estate agents are required to be registered and to demonstrate their acknowledge of the real estate market, and legal and tax advice.

The intermediation of the real estate agents in the purchase process is essential. Being assisted by a reputed and officially registred agent is one of the most important points that buyers and sellers must do when buying or selling properties in Spain. 

In instance, real estate agents’ legal advice is not enough to consider the legal and tax aspects involved in a property transaction, as:

For this reason, the assistance of a qualfied lawyer is required in the property purchase and selling process in Spain.

So why use a lawyer in Spain? It is obligatory to hire a lawyer when buying or selling a house in Spain? 

As stated above, to have a complete idea, and to get information on the buying process, you need to get this information from different local, regional sources, land registry, planning departments, and also to consult with architects and other specialists, etc … ALL THIS WILL NOT BE MADE BY A SPANISH NOTARY.

To do this you will need to get the services of a lawyer who can get all the information from different sources and to check all the ncessary legal and administrative points.

Besides of this, unfortunately, this process is quite complicate so, NOT ALL LAWYERS ARE VALID FOR ASSITING IN PROPERTY TRANSACTIONS. So you need a lawyer who, besides that speaks your language, and who knows real estate law, he must also be a specialist in construction and urban planning law, and to count in his team with architects, and other professionals and technicians, to have enough capability and skill to obtain all the necessary information, and to complete of all aspects regarding the purchase of the property.

Tips when hiring lawyers in Spain when buying/selling a house in Spain

Therefore, at this stage, once the purchase decision is solid, TLA, our firm, advises you to:

2.- How much Lawyer’s costs to represent for buying/selling a house in Spain? 

The cost of a lawyer’s fees to represent you in the purchase of property in Spain can vary depending on a number of factors, including:

In general, lawyer fees in Spain are usually charged at a percentage of the value of the property, plus VAT. The percentage usually ranges between 1% and 2%, but can be higher in complex cases or high-value properties.

Why are Spanish lawyer’s fees calculated based on a percentage of the value of the property? Don’t they charge by the hour?

The reason may be historically determined by the calculation of fees based on the official “Fee Scales” of the Spanish Bar Associations.

As we have seen in this article, the Bar Associations in Spain are distributed in judicial districts or by provinces.

Historically, these institutions determined “minimum” fees that the lawyer had to charge for each service.

In the past, these scales were mandatory, but today their monitoring is completely voluntary, meaning that the lawyer is free or not to use the criteria established in these standards for his offer to the client.

The sole  exception to this “freedom of fee agreement” is established in the calculation of legal costs in the event of a judicial dispute. In these cases, these scales are usually used as references in the event of a judicial dispute. the exclusive effects of valuing that item (the fees) in the incidents of cost assessments or sworn accounts of lawyers.

Let’s see how a lawyer involved in a real estate transaction in different parts of Spain would quote, following the scales of each association or district.

Calculation of Lawyer’s fees when buying a house in Spain by regions

Malaga lawyers’ fees

 The Malaga Bar Association approved its own scales on September 18, 2006.

According to this scale, the different actions carried out by the lawyer are valued with a series of “points”, which accumulate as the process progresses. Finally, the total number of points generated is multiplied by an amount that is updated each year, and which is approved by the Malaga Bar Association. For the year 2023 the value of the officially approved point is 71,50 EUR (plus VAT 21%).

Let’s see how it works in a purchase and sale transaction:

*This percentage is increased by 50% for complicated contractual operations, such as a language other than Spanish, or one of the parties to the contract being a foreign national.

**If in addition to “drafting” the contract, the lawyer “negotiates” its clauses until reaching an agreement, it increases by 100%.

Therefore, at a glance, without focusing on the consultations, opinions, meetings, etc. that may arise from a real estate sale, and focusing only on the service of preparing and negotiating a real estate purchase and sale contract.

Let’s assume a case, a specific case of sale:

SUBTOTAL: 6.792 EUR + VAT

To this amount must be added the fees derived from the drafting and negotiation of the purchase and sale contract:

For a property of 500.000 EUR:

SUBTOTAL: 1,5% x 500,000 EUR = 7.500 EUR + VAT

Therefore, according to the fee scale of the Malaga Bar Association, updated to 2023, if we add the actions prior and after the purchase and sale contract, to the fees derived from the drafting and negotiation of the purchase and sale contract, the result is:

6,792 + 7,500 = 14,292 EUR total fees for legal assistance in a real estate purchase and sale transaction in Malaga.

According to this calculation, the total fees accrued by the lawyer for this sale could be 3% of the value of the property.

This amount, which is the one officially calculated through the official scale of Malaga, is what justifies the quote that is usually offered by the province’s lawyers for advice on property purchase and sale transactions, and which ranges between 1 -3 % of the value of the property + VAT.

Valencia Lawyer’s fees

The Valencia Bar Association approved its own scales on September 9, 2007.

These scales quantify the services of a lawyer in a real estate transaction based on the “value” or “amount” of the transaction. That is, the “price” agreed upon for the sale between buyer and seller. According to this value, percentages are applied on a scale, which are defined according to the functions or services entrusted to the Valencian lawyer.

In this way, based on the official scale and considering the phases and services that the lawyer would perform in a home or property purchase transaction in Valencia, we can make a simulation of the fees that would result from applying said scales.

Therefore, for an example of a real estate sale for an amount of 500,000 EUR, the fees according to the fee scale of the Valencia Bar Association would be as follows:

SUBTOTAL: 4.600 EUR + VAT

To this amount must be added the fees derived from the drafting and negotiation of the purchase and sale contract:

SUBTOTAL: 20.003,4 EUR + VAT

Therefore, according to the fee scale of the Alicante Bar Association, if we add the actions prior and after the purchase and sale contract, to the fees derived from the drafting and negotiation of the purchase and sale contract, the result is:

4,600 + 20,003.4 = 24,603.4 EUR total fees for legal assistance in a real estate purchase and sale transaction in Valencia region.

According to this calculation, the total fees accrued by the lawyer for this sale could be 5% of the value of the property.

This amount, which is the one that is officially calculated through the official scale of Valencia, is the one that should be charged based on this document. However, the reality is that most qualified and registered solicitors quote brokerage quotes for advising on property purchase and sale transactions range between 1-3% of the property value + VAT.

Tips to help  to detect a quality service for lawyers in Spain – Construction lawyers

Hiring qualified construction lawyers to deal with your purchase/sale transaction

It is a grave mistake  to hire a lawyer service in Spain for a price lower than the ones quoted by qualified lawyers. The reason of this is because it could result in a poor quality service, or a big fault of legal guaranties of the process.

A reduction of few hundreds of Euros in lawyer’s fees could not be nothing in comparison with the investment of property acquisition.

So, it is essential to hire a reputed, experienced, and skilled lawyer.   For this, the Spanish lawyer must be expert, not only in real estate law, but also in Construction.

What type of services are usually offered by Spanish lawyers in property transactions?  

Buying a property in Spain requires a very complex process where a lot of information is needed to complete the proper legal study of the case and of the property.

In many occasions you will receive offers of services from lawyers in Spain like these ones:

Formalities

The above services are correct. The majority of the lawyers in Real Estate Law offer these “formal” services, which are essential to proceed in the purchase process.

Legal Study of the property 

In the majority of the cases from lawyers in Spain, following services are provided:

Services mentioned above are also correct, and they must be processed in the right way in the acquisition process.

Both services: Formalities + Legal Checking of the property, is what you may expect in the majority of the lawyers’ service in Spain  when buying a property.

But, unfortunately, this is NOT ENOUGH, in order to have a safe and guaranteed transaction, the proper  “Legal Study” or “Legal Searches” must be more completed.

Qualified construction lawyers: Legal study of the house, the building, the plot, and the history of the construction

Why the services usually provided by lawyers are not enough?.

Because, as buyer, you need and deserve to know ALL the information and aspects affecting the property, the house and the building. And, as yoy may see in the mentioned list, in no case a “legal study of the construction, the building, or the plot is made”.  And this is the MOST ESENTIAL point of the transaction: The HOUSE.

What kind of Legal Study or Legal Searches  a qualified lawyer must do when buying a house in Spain?

Conclusion: Hire Qualified construction lawyer. Complete legal searches

Civil and professional insurance to cover the price of the property

Your lawyer must be covered by the proper civil insurance to protect you in case or fault of service, bad practice, or negligence.

So, ask your lawyer to show you his Civil liability insurance to cover, as minimum, the price of the house.