Notarial Policies

This type of document records a commercial and financial contract between a banking or financial entity and an individual or a company. The notarial intervention grants legal validity and facilitates enforcement in the event of possible breaches of the document. This notarial intervention is the characteristic feature of policies, since while other acts such as deeds or minutes are authorised, policies are intervened or authorised, certifying the signature and consent for the transaction carried out and with effects to demand compliance with the agreed terms through judicial means.

The contracts that occur in policies have common characteristics: they are of a commercial and financial nature, they are typical of the usual business of one of the grantors and it is important that the policy cannot have a real estate object. In other words, the scope of action of policies is resolved in acts such as loans, credits, guarantees, discounts, factoring contracts, confirming contracts, assignments of credits or rights, pledges, granting of guarantees or counter-guarantees, among other variants.

It is not possible to formalise in notarial policies: real estate acts, sale of shares or social participations, acknowledgements of social debts, powers of attorney or corporate operations, which can only be done by public deed. Therefore, only acts and contracts of a commercial and financial nature that are typical of the usual and ordinary business of at least one of the signatories of the policy can give rise to a policy. Therefore, other acts and legal transactions, especially real estate ones, cannot be included in a policy.

There are different types of policy depending on the various commercial and legal transactions that may occur. They are used as instruments to support the fulfilment of obligations or agreements. Among the most common we find:

• Loan Policy: in this type of policy, the bank gives money to an individual or a company, which must be repaid within a set period and with interest and fees.
• Credit Policy: in the credit policy, the bank makes money available to the borrower for a stipulated time, with the client deciding whether to use all or part of the credit.
• Leasing or financial lease policy: the person receives the use of an asset in exchange for paying a monthly fee over a determined period, with the condition that, once the fees have been paid, they will have the option to pay an amount and acquire the asset in question.
• Factoring Policy: a factor or factoring company is contracted and remunerated for providing management, guarantees, and financing services.
• Discount Policy: in the discount policy, a company undertakes to advance credits to a businessperson that could not yet be collected, facilitating the working capital needs of the businesspeople.
• Pledge or Pledging Policy: in this policy, the person guarantees a debt by pledging financial assets. If the person providing the guarantee (pledgor) does not fulfil the obligations, the financial institution will recover the money obtained from the sale of the pledged assets.
• Confirming Policy: in this type of policy, the banking entity acts as a manager in deferred payments to suppliers, being able to offer financing to the company and the suppliers.
• Guarantee Policy: by this type of policy, a person commits to fulfil obligations on behalf of another. The bank guarantee modality is common, whereby a bank guarantees payment to the Tax Agency on behalf of a client, who will pay the bank for granting this guarantee. Bank guarantees can also be used to secure payments to suppliers.

Each type of policy offers unique characteristics depending on the type of agreement and the legal regulations that apply to it. However, the common parts of a notarial policy are as follows:

• Place and date on which it occurs.
• Identification of the Notary (name, surname, residence and College).
• Names, surnames and addresses of the parties involved.
• Qualification of the act or type of contract with the name it has in law or according to the commercial use attributed to it.
• Content of the act in question.
• Agreement and approval of the representatives and signature.
• It must include the total number of pages and annexes that make up the entire text.

The role of the Notary provides legal certainty to the parties involved in the contract. Furthermore, their neutrality guarantees that the parties involved in the procedure receive fair treatment, fully informing and advising all of them about the terms of the document to avoid abuses or deceptions by other parties involved, especially clauses that may include financial penalties for the borrowers. Also, with their intervention, the Notary makes a capacity assessment of the parties involved.

In addition to providing legal certainty in the policies through their intervention, they grant them public faith so that the content is complete in accordance with the provisions of the law and ensure compliance with all laws and regulations. The signing of notarial policies before a notary prevents the document from being challenged in court and reduces the risk of litigation.

On the other hand, the Notary legitimises the signatures and safeguards the original document signed by the parties, from which they can issue copies for the signatories.

There are two ways to intervene in the policy. Through incorporation into the general protocol (record) or into the Register Book (intervention diligence). There are also two sections within the Register Book called A and B. Originals are kept in A and not in B (bills of exchange or promissory notes).

Whichever party is involved in a policy, make an appointment and process your policy with us. You should know that you have freedom in the choice of Notary for this. We can now also intervene in different types of commercial policies online for a faster and more convenient procedure for you, signing with JLA Notarios in a comfortable and modern process, from your office or home and from anywhere in Spain.

The documentation provided will depend on the type of contract that has been agreed upon and established between the parties involved. In this case, participation involves the provision of documentation both by the banking institution and by the borrower, which can be found at both the business and individual level.

The common documentation that must be provided is:

• The banking institution: the representative of the financial institution must present themselves with a valid DNI and the notarised power of attorney to carry out the procedure, that is, the authentic copy that certifies their representation on behalf of the institution. Currently, bank attorneys-in-fact can sign policies entirely online.
• Company: this case is similar to the previous one, with the representative required to provide a valid DNI and the notarised power of attorney that certifies their representation on behalf of the company. Their appointment as administrator can also be presented by showing the authentic copy that certifies such representation. Additionally, there is other relevant information related, including the authentic copy of the company’s incorporation and that of the real ownership certificate. In some cases, the agreement of the Shareholders’ Meeting authorising the operation must be presented.
  Currently, a company representative can sign a policy entirely digitally without needing to attend the notary’s office in person, if they so wish.
• Individual: the documentation will be limited to the borrower presenting their valid DNI. If they are a foreigner, they must present their NIE along with their passport. If a representative of this person must attend the signing of the policy, the valid DNI and the notarised power of attorney certifying their representation of the individual must be provided.
  Individuals can currently sign a policy digitally at any notary’s office in Spain via videoconference, without needing to travel to the notary’s office, provided they so wish.

The cost of notarial policies is determined by law in the Notarial Tariff. The price for the intervention of notarial policies also takes into account the amount of the policy, the number of pages, the number of signatures, or any guarantees that may exist. The notarial tariff for policies is established in the Royal Decree 1426/1989 of 17 November.

The price of notarial acts is regulated by the Government and complies with the regulatory framework of the NOTARIAL TARIFF (RD 1426/1989, of 17 November, regulating the Notaries' Tariff).

However, the exact price of a notarial document cannot be calculated until its specific content is known, that is, until it is signed, as there are many circumstances that can cause it to vary. The number of copies requested of a document, the pages it contains, as well as possible changes or additions, can slightly alter the final price.

In the cost of a notarial policy, the amount of the loan or credit, the duration of the policy, and whether there is a guarantee or surety from any of the parties are very important (in the case of a surety, the cost of a policy increases by 50%).

If you wish to receive a detailed, free, and non-binding quote, we invite you to contact us directly through the method that is most convenient for you. You can do so via the contact form on the main page of this website, through the contact section found in the footer of the website, using the direct WhatsApp access at the bottom right of this page, by sending an email to bcn@jlanotarios.com, or by calling us at 93 159 17 62.

As a guideline, and in the most typical cases, we can inform you that, according to the current regulatory framework, the usual price for formalising a policy before a notary without an amount is about 35 euros.

As a guideline, for policies with an amount such as a loan or credit policy for an amount of €20,000, the notary cost is about €90, including VAT. A notarial loan or credit policy of €50,000 would cost about €180-200, including VAT; and a credit or loan policy for an amount of €100,000 would cost about €300-370.

It is best to request a quote, as this indicative price is calculated for a document with usual content with the amounts indicated, with a one-year term, without guarantors or sureties, and where the policyholder is an individual. In other cases, the cost will vary; for example, it is very common for there to be a surety alongside a loan or credit policy, and in such cases, the notary cost of the policy increases by 50%. Additionally, there may also be changes due to the term or the existence of other guarantees, and also in cases where companies are involved in the policy, it may be necessary to include more documents.

Since 9 November 2023, thanks to the approval of law 11/2023, of 8 May, it is possible to process notarial policies online via video conference.

At JLA Notarios we work empathetically and dynamically, applying new technologies in all procedures for your comfort and convenience. For this reason, we are also an online Notary, where we manage many notarial services electronically, to optimise the transaction times of your procedure through digital signature by videoconference. If you need online notarial policy management, do not hesitate to make an appointment with us. This new alternative route will continue to offer you the same legal security, with included advantages and benefits such as avoiding travel, saving time, improving the speed of the process, and speeding up the transmission of information.

Therefore, at JLA Notarios we can process your policy without you having to travel from your home or company and from anywhere in Spain, since in policies we work as digital notaries and can carry out all procedures online.