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Our previous posts already reported that the most popular process through which M&A transactions commonly initiate a business valuation, bases on simple multiple of earnings methods for a valuation that allows fixing the overall worth of the transaction. This is a quick, relatively easy formula (depending on many factors, not all multiples will be useful); however, we understand that it should not be taken as a dogma of faith as that system has certain limitations. This method is based on the fact that the market is a reliable indicator and that. Let’s explain this theory with a clear example: if my neighbour on the third floor has sold his apartment for 160,000 euros and my neighbours across the street have sold theirs in the same month for 162,000 euros, it means: if I want to sell mine… easy calculation: the previous amount will be the value I can give to my property. Most commonly used multiples in business valuation In the case of company acquisitions and reorganisations, the most "famous" multiples are the EV/Ebitda (enterprise value understood as the real price of its shares plus its debts divided by its EBITDA) and the PER (share price divided by profits). When it comes to M&A transactions in SMEs, it is very difficult to obtain these ratios for comparable companies. This is due to the fact that share prices in unlisted companies are difficult to obtain (and there are not many SMEs listed on the stock exchange). Similar transactions in the sector are usually observed (if this is possible, at all) and 'like-for-like' magnitudes are compared to the multiples described. One of the most common methods is to divide the transaction price by the EBITDA and find out how many "times" it has been paid for. Example of business valuation by multiples For example, if we imagine a business in a certain sector whose partners have decided to fix a price for the sale, the first thing they will do is to identify transactions of similar companies in their sector (if available). They obtain the following data: Let’s remove the lowest and highest value (transactions 5 and 10 respectively) to exclude those extreme amounts and obtain an average value of 6 times EBITDA. As a conclusion, a reasonable "market value" for the business would be to ask for 6 times the last EBITDA (or an average EBITDA or an expected EBITDA). This is just one example, depending on the sector, other multiples or combinations of multiples can be used. Other formulas can be applied as well; these practices are not strict "laws of physics". Moreover, depending on the sector, non-financial multiples are used (e.g. number of hotel rooms or number of users of the service of my business). Limitations of business valuation multiples However, this valuation by multiples has many limitations, among which the following stand out: It does not take into account the debt of each business acquired (acquiring a business with a very large debt is not the same as acquiring another with a cash surplus). The type of buyer (venture capital fund, industrial investor) is not evaluated. Each has a different strategy and objectives when acquiring a business and therefore, each case may have a different willingness to pay. Acquisition of real estate and/or intangible assets acquired together with the business may represent another issue that it not considered, here. EBITDA may be unadjusted and therefore include non-recurring or non-market items, depending on the nature of the business (e.g. directors' credit card expenses). The future prospects of each business are not known. When one acquires a business, the past is fine, but what is really important is what is expected to happen in the future. All these limitations can be summed up in the fact that, even if we were to accept that the companies in these transactions are comparable to our own, no two businesses are the same. And the fact is that, while my two neighbours have sold their houses for around 160,000 euros, it is possible that mine is worth 200,000 euros for example (it has a better orientation, a renovated kitchen and central heating). Moreover, be careful! Do not mix up value with price (I can offer my house on the market for 300,000 euros, while a multimillionaire comes along and buys it the next day for that price without asking further). Supporting business valuation by market multiples This does not mean that using multiples of Earnings Valuation is wrong or incorrect. In fact, it seems perfectly reasonable that, if transactions between companies of similar size in an industry have been taking place recently in the range of x times EBITDA, then my business transaction may move around those figures. But it would be appropriate to have the particular valuation of my business, which has specific conditions (customers, work methodology, future prospects, expansion plans, market power, backward vertical integration...), sustained by a discounted cash flow method (DCF) or any other method universally accepted in finance to support that valuation range by multiples, or justify that the valuation of my business is above market. The Discounted Cash Flow method DCF is a more technical, more “scientific” and more laborious method, but precisely for this reason, it provides a more objective value of the company or business within the subjectivity (it is based on premises) as well as being perfectly valid for SMEs. We at Carrillo Asesores are experts in M&A operations and business valuation. Please contact us. Our Tax Department will be more than pleased to assist you.

Blockchain technology has been on the rise for 13 years now (2009). For many users, it is still new or even difficult to understand. The truth is that it is a reality that has not been regulated to date, but requires a minimum of knowledge and an approach from a legal point of view. This will be the first of a series of posts published in the aim of using a simple and more accessible way to explain what this Blockchain technology consists of, what we know as "Tokenization" and the most important legal aspects it consist of. What is a Blockchain technology As a matter of facts, Blockchain technology is configured as a database. It is digital, immutable, shared, synchronised and decentralised. This technology allows the database to be located in the device of each user (node). The feature requires validation of each modification by the rest of the users; subsequently it does not depend on a central authority. It was created by Satoshi Nakamoto, the pseudonym of one or more people who preferred not to reveal their identity. Its first practical application was the purchase of a pizza. What was the purpose of Blockchain technology? The purpose of this technology was to achieve an electronic payment between individuals without the need for the intervention of intermediaries, thus saving the economic and time costs and obtaining the guarantees and security of a mathematical system. Evolution of Blockchain technology Reviewing the evolution of blockchain technology from its origin to the present, we can see that the first "Bitcoin" blockchain, version blockchain 1.0, was only intended for carrying out transactions. In other words, transmissions of Bitcoins between two "bitcoin addresses", each of which designates a subject, which are reflected in a kind of summary or document that is made after encrypting or encoding the transaction and which results in the "hash". What is a hash? Without going too deeply into computer or technological concepts and in order to understand what we mean when we talk about hash, it is necessary to know that Blockchain means "chain of blocks", each block integrates a group of transactions and each transaction is encrypted or summarised in a hash. The blocks are linked together, with the result that the "final or closing hash" constitutes the initial hash or first annotation of the next block. Merkle Tree In addition to the "chaining" of blocks, the differentiating elements of this first blockchain are: The so-called "Merkle Tree". This security element allows the hashes generated for each transaction to be combined with each other, creating a kind of tree and allowing any alteration that may occur to imply a variation of the Merkle Tree. This prevents the manipulation or falsification of any element by a hacker, as it would be detected, achieving an "unmodifiable" system. Traceability within the blockchain Finally, with this blockchain, the "traceability" of documents is achieved. It means that we can track or trace all the operations that a subject has carried out on the network since acquiring their first bitcoin. However, this total transparency that seems to emerge from the element of "traceability" is limited by the fact that it is possible to trace an asset, but not the identity of the person who owns it. Other popular blockchains As a result of this first blockchain, others were created based on its elements. The best known is undoubtedly the "Ethereum" network, blockchain version 2.0, which also has its own cryptocurrency. Hence, "Ether" is more complex, in addition to carrying out transactions on "ethers", creates and hosts Smart Contracts, which we will go into more specifically in our forthcoming publication. Afterwards, another feature called "Ripple" was created, which is configured as a payment protocol for financial institutions. It is a network for institutional payment providers and allows instant international payments with any cryptocurrency, although, like the rest, it also has its own cryptocurrency, XRP. Finally, and within the most popular blockchains, we also find "EOSIO", a decentralised blockchain infrastructure that offers a set of tools similar to those of computer hardware. This one aims to facilitate the development of decentralised applications (DApps) (blockchain version 3.0). "Stellar", closely linked to Ripple with a practically identical objective, to facilitate cross-border transactions with the target of making them faster, more secure and lower cost, but it is managed by a non-profit foundation. Blockchain version 3.0 is running currently. This is focused on the development of DApps or decentralised applications. What are DApps, blockchain 3.0? DApps are a special category of applications based on blockchain technology that operate in a decentralised network. The data generated by these applications is hosted on a network of computers that allows the information to be kept secure and accessible. The main difference between a Dapp and an App lies in the centralisation. In an App all decisions will be made on a central server and there is a manager with access to this data who can modify it. However, in a decentralised application there is no single manager who controls the application because it does not depend on a central server and the users themselves are the managers of the application. Do you want to know more about the legal aspects of the technology that is flooding the world's markets? Reach out for us. The legal team of Carrillo Asesores will study your specific case, we will be delighted to assist you with the technological development of your company.

A few days ago, we heard again about the 28 million € fine that the European Commission (EC) had imposed on the Japanese company Canon, for carrying out the acquisition of Toshiba Medical Systems Corporation (TMSC), a subsidiary of Toshiba. This was made without having received prior authorisation from the CNMC (Comisión Nacional de los Mercados y de la Competencia). This type of case is commonly known as “Gun Jumping”. What does Gun Jumping mean? Gun Jumping, in the words of the CNMC itself, "basically consists of executing an economic concentration operation, which should have been notified for prior authorisation, before the responsible authority (either the CNMC in Spain or the European Commission in Brussels) has given its approval. This practice is a breach of the Law on the Defence of Competition (LDC), as companies are obliged to notify their purchase operations to the CNMC before executing them when they exceed certain thresholds". Significant increase in Gun Jumping cases Gun Jumping cases have been progressively climbing up since 2014. They reached their peak in 2021, when a total of 19 Gun Jumping cases were registered globally. This is a significant increase considering that only 2 cases were registered in 2014. The details of the sanction against Canon for Gun Jumping Before we start to learn about the ruling, it is important to know the facts. The acquisition transaction by Canon, started in March 2016, when the two companies reached an agreement whereby the transaction would be split into two stages: Interim transaction In the first stage, Toshiba was supposed to transfer 95% of the shares of its subsidiary to a special purpose vehicle that was created specifically for this transaction. At the same time, Canon would acquire 5% of TMSC's shares and a call option on the vehicle company's shares for a total amount of 5.28 billion euros. The Japanese company submitted an initial pre-notification in March, notified the transaction in August and received EC clearance in September. Final transaction The second phase of the transaction did not start until December of the same year. Canon waited until then to obtain clearance from all merger control authorities for the Toshiba subsidiary to be incorporated as a subsidiary of Canon. However, in March 2016, an anonymous whistle-blower contacted the EC to inform them of these proceedings. It was in June 2019, three years later, that the European Commission took the decision to impose two fines on the Japanese company. One for failing to notify a concentration and the other for implementing a concentration before obtaining authorisation. These two fines were appealed by Canon to the General Court of the European Union (CJEU). They argued that the EC's decision was meaningless as the intermediate steps of the acquisition had already been implemented. The Court ruled this past 18 May in its case T-609/19, rejecting Canon's arguments on the basis of the case law already handed down in the Ernst & Young case. This case confirmed that the full acquisition of control of a company is not the only criterion by which mergers are assessed, but that it is also important to take into account whether the operation contributes to a lasting change of control of the company. Therefore, the latter criterion is the basis for the decision of the EUAT, i.e. that the first step was "necessary" to take full control of the company, so that Canon violated the European competition rules by carrying it out before notifying the transaction. When a merger occurs Furthermore, the Court added that, even if the transaction was divided into two distinct phases, it was still a single concentration. The first phase being a necessary and indispensable step in the implementation and contributing to the change of control of TSMC. In fact, in Council Regulation 139/2004, the EU already defined that: "A concentration shall be deemed to arise where there is a change of control on a lasting basis as a result of: A) the merger of two or more previously independent undertakings or parts of undertakings; or (B) the acquisition, by one or more undertakings, through the acquisition of equity or assets, by contract or otherwise, of direct or indirect control of the whole or parts of one or more other undertakings". Finally, if you want to know more about how to deal with a company acquisition process, either from the perspective of the buyer or the seller, do not hesitate to contact Carrillo Asesores. The experts of our Legal Department will be able to study the situation so that your company does not suffer the same fate as the case we bring you today. For sure, a transaction of such dimensions must be advised beforehand by expert lawyers and economists. We are at your service for whatever assistance you may need.

The recently issued Law 12/2022 of 30 June, stipulates that a new Corporate Income Tax deduction has been created, applicable to business years starting on or after 2 July 2022, for companies that make contributions to company pension plans. Corporate income tax deduction for contributions to company pension plans Specifically, a deduction of 10 per cent of the gross tax payable is introduced for company contributions to company retirement schemes attributed in favour of employees (new article 38.ter LIS). More and more companies are becoming interested in the possibility of setting up company pension plans, as the government wants to promote this option, as opposed to contributions to personal pension plans. You should therefore be aware that if your company is thinking of starting to pay its employees in kind through one of these company plans, then the following topics must be considered: Expense. Like any other sort of remuneration, the contributions made to the retirement plan will also be a deductible expense for the company in the Corporate Tax. No taxable income. Likewise, if your company respects the established contribution limits, you will not have to pay any income on account of the IRPF= employees' personal income tax. Remark. You must declare the annual contributions to the plan using form 345 (and not form 190). Retirement plans are taxed. Contributions to pension plans pay Social Security contributions (unless the worker to whom they are attributed is already paying contributions at the maximum rate). New Corporate Tax Deduction on corporate tax for company contributions to employee retirement plans A new corporate tax deduction has been approved for companies that make company contributions to these retirement plans. Remark. This deduction is up to 10% of the amount contributed, and will be applicable to business years starting from 2 July 2022 (i.e., in most cases it will be applicable from 2023). Basis of deduction. The base for this deduction (the amount on which the 10% deduction is applied) is as follows: In the case of contributions in favour of workers with gross annual remuneration of less than 27.000 euros, the basis for deduction is the total amount of the contributions. In the case of employees with a gross annual salary of EUR 27,000 or more, the deduction applies to that part of the contributions which is proportional to this amount. Let us view an example: What would be the deduction applicable in Corporation Tax for an entity that contributes 250 euros/month (3.000 euros per year) to an occupational retirement plan when the worker has a gross remuneration of: 25.000 euros. 30.000 euros. 40.000 euros. 60.000 euros. Figures are outlined as per the following scheme: Incentives on Social Security contributions for employer contributions to employee retirement plans You should also be aware that, from 2023 onwards, these company contributions would benefit from incentives in Social Security contributions, so the savings obtained can be even higher. Do you want to take advantage of this system corporate tax deductions? Just contact us! Our Tax Department will be delighted to help you.

Accessibility at work, am I allowed to use my cell phone for personal topics, or can I use my personal device for labour matters? Disconnection is one of the most important aspects in our current lifestyle. Unplugging is increasingly difficult to do due to the excessive use we all make of our electronic devices. In fact, according to a study by Ditrendia, Spanish citizen do spend an average of almost 4 hours a day using our smartphones. A statistic important enough to focus on the use of cell phones at work. Doubts about the use of cell phones at work The scenario has evolved to a point where the vast majority of us use our personal phones for work-related duties, or our company phone for personal matters. In fact, nowadays it is practically impossible for us to differentiate between these two worlds. A number of questions arise: Are employees allowed to use my cell phones for private purposes? Can my boss restrict or prohibit me from using my cell phone for personal matters during my working day? What happens if I use my business phone for private matters? These questions are spreading around in our daily performances; let’s try to clear up these issues. Can I limit the use of my company phone for personal matters in my company? Organic Law on Data Protection First, we must have a closer look at the Organic Law on Data Protection (LOPD), specifically Article 87, which states that: "Workers and public employees shall have the right to the protection of their privacy in the use of digital devices made available to them by their employer". Furthermore, it states "The employer may access the content derived from the use of digital media made available to workers for the sole purpose of monitoring compliance with work or statutory obligations and ensuring the integrity of such devices". On the other hand, "Employers must establish criteria for the use of digital devices, respecting in all cases the minimum standards for the protection of their privacy in accordance with social customs and the rights recognised constitutionally and legally. Workers' representatives must be involved in drawing them up". Therefore, the first conclusion we draw from this Article 87 is that the use of cell phones as such (as long as it is not for criminal or unlawful purposes) cannot be prohibited at work. However, limits or criteria for use shall be established. Workers' Statute We have some exceptions to the rules. According to art. 58 of the Workers' Statute Law, the employer may restrict the use of mobile phones or certain applications if they are being abused. A prior communication establishing terms of use must be announced in two different ways: First, through an internal communication stating both, the prohibition and the sanctions. Secondly, by incorporation of a specific clause in the employment contract that the employer has with the employee. What about the use of personal mobile phones for work-related purposes? Although there is not much legislation on this issue, we can find some rulings that will spread some light on this question. On the one hand, and as a general answer, a ruling of the National High Court (reaffirmed last year by the Supreme Court (SC)) declares as an abuse of company law the fact that the worker has to provide his own device for the performance of his work. In this way, it would be breaking the alienation of the means, one of the most fundamental characteristics of the employment contract. Let us review this issue in detail. There is another Supreme Court ruling which even goes so far as to state that the employee, if he so wishes, is not obliged to give his e-mail address or telephone number to the contracting company. Use of cell phones at work, the Right to Privacy The employee's Right to Privacy is very well protected by current legislation. The law that protects this right is Organic Law 1/1982, of 5 May, on the civil protection of the right to honour, to personal and family privacy and to one's own image. Due to the provisions of this Organic Law, over the years, case law has been created in which any technological device in which the family or personal life of any person is carried out is protected by the right to privacy. The use of technology by our workers and in our companies is increasingly limited. If you need to monitor the use of technology in your business by means of control applications, whatever your doubts and requirements related to employment topics are, simply reach out for Carrillo Advisors. Our Labour Department will be more than happy to assist you!

The RED mechanism allows companies reducing the working hours or suspending the contracts of their workers with benefits in terms of contributions. Royal Decree-Law 4/2022 regulates the functioning of the RED mechanism to guarantee employment stability and the transformation of the labour market. It establishes procedures that provide flexibility to companies in difficult situations, with the aim of avoiding dismissals and ensuring the training and recycling of the workers affected. The RED Fund has been set up to meet the requirements of workers and companies that need to take advantage of the RED Mechanisms. After a transitional regime, the management of this fund will be the responsibility of the SEPE (State Public Employment Service) What is the RED Procedure? It is a new type of Temporary Labour Force Adjustment Plan that must be activated by the Council of Ministers. After implementation, the affected companies may voluntarily apply to the labour authority for either a reduction in working hours or the suspension of employment contracts, while the RED Mechanism for that sector is activated. The procedure is subject to the provisions of art. 47 bis of the E.T. (worker’s statute) with benefits in contributions and provisions. Article 47 bis of the Workers' Statute "The RED Procedure for Employment Flexibility and Stabilisation is an instrument for employment flexibility and stabilisation which, once activated by the Council of Ministers, will allow companies to apply for measures to reduce working hours and suspend work contracts". Objective of the RED Procedure The main target of this procedure is to provide companies with tools that allow them to adjust to situations of crisis or cyclical changes in demand, providing employment stability. It aims to reduce the high temporary nature of the Spanish labour market. Modalities of the RED Procedure The RED Procedure consists of two different modes: Cyclical: which is applied in the event of a general macroeconomic situation that makes it advisable to adopt additional stabilisation measures. It has a maximum duration of one year. Sectoral: it can be applied when there are permanent changes in a certain branch or sectors of activity that generate retraining needs and professional transition processes for workers. This method has an initial duration of one year and two possible extensions of six months each. These measures pretend to avoid the immediate dismissals that adverse economic, technical, organizational or production reasons could entail. If you have any doubts about this new method, please contact us without obligation. Our Labour Department will be delighted to help you.

Football has evolved a lot in recent years. The figures for the signing of Cristiano Ronaldo by Real Madrid recently, which was around one hundred million euros, caused big expectations. Nowadays, we are more and more getting used to see these figures for a transfer in the soccer world. We know that it is a sport with high economic costs for those who want to invest and enter the business. Today we want to talk about the viability of holding structures in a football club. Before going ahead with our thoughts on this topic, we offer the following links leading to posts about holding companies, thus providing you with more information: Holding. Holding structure at a Football Club, the City Football Group One of the great pioneering clubs causing revolution in the way of structuring their company has been Manchester City, the team currently coached by Pep Guardiola. To properly analyse the reason for this change, we must look a little closer at its history. The English team changed ownership in 2008, with Mansour Bin Zayer, deputy prime minister of the United Arab Emirates, taking over the club. This change came about due to the huge financial losses that the “Citizens” were making, taking over the 800 million euro losses that the club was making at the time. In order to turn up the club's revenues and revolve the situation, Manchester City was transformed into the City Football Group (hereinafter CFG). In other words, a holding company. One of the reasons for this is to bring together the shares of several football teams under its structure. What advantages does a holding structure offer to a football club? This new structure offers plenty of benefits. Moreover, in this specific case it allows them: The possibility of having several teams to attract talent from all over the world. A network that helps to sustain the economy of their club. At the time this City Football Group project was initiated, there were many doubts about financial issues; but nowadays, investment funds support their model. The reason is the progressive offer of higher marks to their management. Moreover, the group has been incorporating increasingly large investors such as Silver Lake, which invested around 420 million euros just 3 years ago. Which companies are incorporated in the CFG's holding structure? Currently, CFG owns or co-owns more than 5 teams around the world: 1. Manchester City (England). 2. New York City FC (United States). 3. Girona FC (Spain). 4. Club Atlético Torque (Uruguay). 5. Yokohama F. Marinos (Japan). 6. Melbourne City FC (Australia). In fact, a new acquisition by this group is also in the pipeline, as they are now trying to take 51% of Brazilian giants Atlético Mineiro, a club that has recently produced great talents such as Vinicius. Useless to say that, when innovation works, the model is followed by the rest. This case underlines this assumption; we can see that big clubs such as FC Barcelona have already taken note of this new organisation and are trying to replicate the model with some clubs in Latin America. How to achieve management of so many clubs? In City Football Group's ground-breaking model, there is a very well-defined administrative structure that helps to have everything very well organised. Each team has an organisation in which the CFG includes a president who is in charge of financial matters and a sports director who is in charge of the different sporting responsibilities of each club. In addition, the model allows a network in which frame the clubs exchange both footballing and financial knowledge. Regular meetings between the teams where, for example, new tactics are exchanged or players can be loaned or exchanged if one of them is not qualified to play in England but good enough to play in Australia, are reported. Success on the field always brings benefits off the field If we want to increase our profits in the world of sport, we have no choice but to be successful on the pitch, because sporting and commercial success always go hand in hand in this context. The earlier mentioned holding company already reported profits of $616 million in 2017. These profits are the translation of the winning period that the English club started in 2013/2014. Since then, it has earned a total of 14 trophies; this in turn has excited many Manchester City fans and attracted the interest of new investors. Would you like to learn more about all the advantage a holding structure offers? Please do not hesitate to contact us. Do you have doubts if a holding structure can help you? Our specialised holding and sports department at Carrillo Asesores will be delighted to assist you. Solve your doubts right now!

Companies with more than 50 employees must comply with the establishment of an equality plan. The approval of the equality plan must be accomplished according to the number of employees: From 7 March 2020, companies with between 151 and 250 employees. From 7 March 2021, companies with between 101 and 150 employees. From 7 March 2022, all companies with more than 50 employees. Our previous post offered preliminary details on this topic Equity Plans (EP) – SME enterprises catching up with large companies. Article 45 of Organic Law 3/2007, dated 22 March, for effective equality between women and men, establishes that companies are obliged to respect equal treatment and opportunities in the workplace. To this end, they must adopt measures aimed at avoiding any type of discrimination between women and men in the workplace. These measures must be negotiated and, where appropriate, agreed with the legal representatives of the workers in the manner determined by the labour legislation as the case may be. One of these measures is the drawing up of the aforementioned Equality Plan, but What is an Equality Plan for companies? An Equality Plan is an ordered set of evaluable measures aimed at eliminating the obstacles that prevent or hinder effective equality between women and men and gender discrimination in companies. How is an Equality Plan structured? An Equality Plan is structured after a prior diagnosis, negotiated with the legal representatives of the workers, and drawn up in the negotiating committee of the Equality Plan. Equality plans must: Set the objectives to be achieved. Establish the strategies and practices to be adopted to fulfil them. Include the establishment of effective systems for monitoring and evaluating the objectives and measures set. What is the applicable legislation for drawing up equality plans? Organic Law 3/2007, of 22 March, for the effective equality of women and men. Royal Legislative Decree 2/2015, of 23 October, approving the revised text of the Workers' Statute Law. Royal Decree-Law 6/2019, of 1 March, on urgent measures to guarantee equal treatment and opportunities between women and men in employment and occupation. Royal Decree 901/2020, of 13 October, which regulates equality plans and their registration and amends Royal Decree 713/2010, of 28 May, on the registration and deposit of collective bargaining agreements and collective labour agreements. Royal Decree 902/2020 of 13 October on equal pay for women and men. Royal Decree 713/2010, of 28 May, on the registration and deposit of agreements, collective bargaining agreements and equality plans. How to find out the number of workers to determine if there is an obligation to draw up an Equality Plan? As indicated at the beginning of this post, companies with more than 50 employees are obliged to have an Equality Plan. However, the question then arises as to how to For calculation of the numerical requirement of the workforce, companies will have to calculate the number of employees on 30 June and 31 December of each year. The reference unit and all of its work centres must be taken into account. This calculation will be made on the total workforce of the company, regardless of the type of contract. In fact, it will include staff on permanent contracts, fixed-term contracts and on stand-by contracts. In the case of people with part-time contracts, they will also be counted, regardless of the number of working hours. Those persons with fixed-term contracts in any of their modalities that have been in force in the company during the previous 6 months, even if they have already been terminated at the time of the calculation must be added, as well. What happens if the number of employees reaches a level that makes the Equality Plan compulsory? As soon as the number of employees exceeds the limit, the obligation to negotiate, draw up and implement the Equality Plan arises. The procedure will then begin with the constitution of the Equality Plan negotiating committee and the diagnosis. How to make an Equality Plan for your company in 2021-2022? The steps to create an Equality Plan for your company are as follows: Constitution of the Commission. Carrying out a diagnosis of the situation. Drawing up and approving the plan. Implementation of the planned measures. Registration of the Equality Plan. What are the consequences of having the obligation to draw up an Equality Plan and those resulting in neglects? Failure to draw up an Equality Plan or to do so without complying with the terms of the commitment is considered a serious offence. This is because it is a breach of the obligations regarding Equality Plans and Measures established in the Organic Law 3/2007 of 22 March for effective Equality between women and men, the Workers' Statute or the applicable collective bargaining agreement. Failure in compliance with Equality Plans may also be considered as a very serious infringement. This will be the case when the obligation of such a Plan is in accordance with the provisions of section 2 of article 46 of the aforementioned Law. In fact, the amount of the sanction, as indicated in article 40 of the Law on Infractions and Sanctions in the Social Order (LISOS) can range from €626 to €187.515, depending on the case. It should be noted that, if the offence is classified as very serious, the company will automatically lose the aid, bonuses and benefits derived from employment programmes, as well as the suspension of access to these programmes for six months. Our team at Carrillo Asesores can assist you with the implementation of your Equality Plan. We may also assess you with your Salary Register, which is required by RD. 902/2020 of 13 October. Visit our website in case you need to hire any of the services on this page. Do not hesitate to contact us if you have any queries. Our Consultancy Department will be delighted to help you.

Carrillo Asesores merges with Asesoría Palacios and consolidates its regional growth expansion with the opening of a new branch in the city of Totana. New delegation of Carrillo Asesores in Totana The fusion between Asesoría Palacios and Carrillo Asesores, with a consequent reopening of the offices, from now on established as headquarters of Carrillo in Totana (Region of Murcia), has been published today. What does the consolidation between Carrillo Asesores and Asesoría Palacios entail? It means that the services offered until now within the labour and tax fields exclusively, will be extended to the following areas: Legal-corporate. Subsidies. International consultancy. Sports. Art and culture. It will thus offer a comprehensive service to companies based in the area of Guadalentín. Carmen Hernández, new manager The current Totana team (José Palacios and Mª Dolores García, as well as David, Eulalia, Eva, Victoria and Eric), will continue working in their respective areas. But from now on, they will also receive the support of the experts that make up Carrillo's multidisciplinary team, a large family of 90 employees. Carmen Hernández, the new manager of the Carrillo Asesores office based in Totana, states: "Leading with Carrillo, offering our service to the customers in this area is an exciting challenge". Carrillo Asesores is proud to announce that - as a consequence of the consolidation - the service is now being offered to all entrepreneurs and companies in Totana and surroundings. Feel free to get more information, access to Carrillo Asesores.

The TSJ (High Court of Justice) of Catalonia, issued a ruling that has been very controversial in the labour law sector, recently. It is related to dismissal during medical leave. In fact, a dismissal was declared null and void. The reason was that the company had a policy of firing workers who were continuously absent due to sick leave. Dismissal during sick leave Let us have a closer look at the specific case. The dismissal was caused by an employee who had a temporary contract and had been on sick leave several times due to spinal problems. It should also be noted that the employee had refused to undergo medical examinations. She had simply communicated her pathologies to her superiors in order to justify her repeated temporary absences. Finally, the company took the decision to dismiss her for her sick leave, arguing that it was company policy. Ruling of the Supreme Court of Justice on dismissal during medical leave Why does the High Court of Justice of Catalonia make this decision? The High Court of Justice of Catalonia found that this practice is a violation of art. 15 of the EC and that, therefore, there is a violation of the right to physical integrity. Moreover, the main reason given by this Court is that this violation can be a threat and an element of persuasion for workers to think twice before asking for sick leave. Therefore, the resolution of the case has resulted in the immediate reinstatement of the employee. In addition, she has received a compensation of 18,077.50 euros and the payment of unpaid wages. The Workers' Statute, specifically in article 55.5, considers that the reason for dismissal violates one of the fundamental rights and public liberties of the worker. Positions on this ruling... This controversy has arisen because, from one sector, it has been understood that the ruling of the TSJ of Catalonia was unprotecting companies and, on the other hand, excessively benefiting the rights of the worker. The argument used by this sector is that employees are being protected too much and that this ruling increases even more the rigour of the position that workers cannot be dismissed in any way during sick leave, thus harming the employer company by having to keep on the payroll an employee who is not really fulfilling his or her duties. Let us remember that the idea behind this ruling is the continued practice of some companies of dismissing workers on sick leave, questioning its legality or not, by taking this measure as company policy, which can make other employees think twice before requesting sick leave from the company and discouraging workers from looking after their health for fear of dismissal. Finally, if we are moving towards a context in which the company may find itself unprotected against the workers, or the workers against the company, you can count on our team of expert Employment Lawyers. Just contact us without commitment. We will be delighted to assist you.

People with losses pending to compensate in the IRPF (Personal Income Tax) can sell shares, real estate, investment funds, ... before the end of the year, thus allowing a compensation in time. This is a way of saving personal income tax by offsetting profits and losses, as detailed below. How to save personal income tax, offsetting profits and losses Those individuals who sell an item of their assets (a property, securities, etc.) incurring losses, can offset them against the personal income tax savings base for the year in which they occur and for the following four years. Firstly, with the gains of each year derived from the transfer of assets, and if this compensation results in a negative balance, with up to 25% of the capital gains of the year. Subsequently, a first saving in tax is applicable, for example, if we sell before the end of the year with losses, then we can compensate with other capital gains produced during the year and even with up to 25% of the capital gains (interest, dividends, etc.). Offsetting losses from previous years Another way to save tax arises when taxpayers have losses from previous years that have not been offset and for which the maximum period for deductions is approaching (those generated in 2017). They may have an alternative to avoid losing the right to offset. If they hold shares, FIMs or other products, with latent gains, they can sell them, generate such gain, offset prior years' losses, and even buy them back afterwards: Repurchase of the same securities does not affect the computation of the gain. The IRPF (Personal Income Tax) law prevents losses obtained when there is a repurchase in the following two months from being computed (to prevent fictitious losses from being generated), but says nothing about gains. On the other hand, the purchase of the new shares will mean that they will have a higher acquisition value, while the new purchase value is consolidated. If the shares are sold later, with an increase of the acquisition value, then the gain to be declared will be lower and the tax to be paid will also be reduced. Moreover, if I have capital losses this year, then I can decide to sell with gains and offset them against each other. Example of tax savings in personal income tax by offsetting profits and losses By way of example. An individual carries forward a loss of 20,000 euros from 2017. Let's imagine that he has shares that cost him 80,000 euros and are now trading for 98,000 euros. He can sell them and buy them back for the same amount without paying IRPF (PIT). He will be able to compensate the losses for 18,000 that came from 2017. In this case IRPF (PIT) is not levied, as the tax is consolidating the new purchase of shares for 98,000 as the acquisition price. Our Tax Department strives for the best way to save taxes for our clients. Write us for any questions or information. Our staff at Carrillo Asesores will be pleased to help you.

The business environment we are facing nowadays is becoming increasingly challenging to growth. Our today’s publication talks about one of these growth strategies. It is known by its Anglo-Saxon term M&A, (Mergers and Acquisitions). Too often, either the specific sector in which a company operates is exhausted, or it is difficult to gain market share in it. Sometimes this is due to competition (current and potential); in other cases, the presence of substitute products or services are the barriers. Hence, many companies choose to go for a diversification strategy of their business. They do this in two ways: Related diversification. Products or services related to their branch. For example, if I sell mattresses, I will also sell pillows, or if I provide services as a car workshop, I will sell trucks, too. Unrelated diversification. The classic strategy in our country: I am a company that sells consumer goods, now I also would like to deal the real estate business. What is M&A? There are many ways to start the diversification. One of the most widespread strategy is to do so through acquisitions or mergers with other companies that are already established in the branch or sub-sector we want to target. This is known as M&A, Mergers and Acquisitions. This process has the advantage of acquiring a company that is already established in the sector. This avoids a start-up from scratch with all that this entails. The established company already has expertise, a portfolio of clients and other elements, which are usually the most costly when starting a business. Step 1 in M&A: Valuation of the company The M&A process has to start with a valuation of the company we are interested in. Obviously, if we are going to "buy" something, we have to know how much it is worth. Therefore, a valuation report from an independent analyst or expert is essential, in addition to other issues that we address in our post Buying and selling companies, topics to take into account. Company valuation methods Although there are a multitude of valuation methods, the most widely used and universally accepted in the financial world are: Discounted cash flow valuation (DFC). This method assumes that the past is relevant but that what is important for a company is its future. The validity of this method depends on the degree of reliability of the forecasts we can make about what the business will generate in the future and many factors come into play. Despite its complexity, it is the most correct method; someone does not buy a company knowing is not going to generate anything in the future, even if it has done so in the past. Valuation by multiples. This method consists of estimating a business value by comparing it with similar companies, with the sector, with the company itself in the past, analysing past transactions of similar companies... and thus obtaining an estimate of what would be a reasonable price in the form of multiples of EBITDA normally. If the company "next door" sold for 10 times its EBITDA for the year, the one I want to buy should be for a similar price. Of course, as long as benchmark transactions can be found (this can be difficult for unlisted companies), it is a much faster method and that is an advantage. The disadvantage is that it takes into account the past and not the future, although this method can be interesting as a complement to the previous one. Step 2: Negotiation and contract drafting Once the valuation of the company is clear, then the whole part of negotiation, drafting of contracts... to complete the operation follows. But without a prior valuation that allows the use of reasoned and objective arguments, it is certainly not possible to sustain a coherent M&A strategy. Our expert staff at Carrillo Asesores Tributarios y Abogados SLP mirrors on the whole chain of tasks necessary to maximize the M&A strategy of your company. It starts with the valuation and analysis of a company. After this, a draft and/or review the drafting of documents and commercial contracts follows. We also act as your face-to-face assistance in the negotiation. Ensure you have access to the resources necessary to strive for success. Reach out for us!