Foreigners are required by law to obtain a fiscal identification number, or Numero de Indentidad de Extranjero (NIE), when buying Spanish property. This was often not applied for until the property transaction was completed but the law has now been changed and obliges Spanish property buyers to acquire their NIE before completion.

"When a 'foreigner' buys a Spanish property it is necessary to have a Fiscal Identity number called the NIE," states John Howell from the International Law Partnership. "This number is needed for various reasons – chiefly when you have any dealings with the tax authorities.

"Things have recently changed and the notaries are now requiring that the NIE is obtained prior to the signature of the title deeds. This is very sensible as it means that the title deeds can immediately be registered at the Spanish land registry rather than there being a delay. This change has come about because of the increasing awareness of money laundering and terrorism and the willingness of the Spanish authorities to clamp down on proceeds of crime."

The usual time scale of around two to six weeks to be given your number after application must now be factored into the Spanish property buying process.
 
Howell continues: "Obtaining the NIE is a relatively straightforward process – although in practice it can be a bit frustrating and can take some time depending on the workloads of the local authorities. The forms can be obtained on the internet and you take these with some passport photos to the local Spanish police station with proof of why you need an NIE (your purchase contract should do) and they will process the application."
           
Other law changes affecting Spanish property may also be on the cards as the European Commission has threatened Spain with court action unless it changes its Valencian 'land-grab' laws by December. The laws have left thousands of property owners in the Spanish region of Valencia area facing the loss of their property and huge bills.

The law was passed in 1994 in order to ensure community development was not blocked by individual landowners but has led to the loss of thousands of homes and left Spanish property owners faced with large bills for the installation of roads and drainage.

The law was amended in December 2005 but the Commission says that it still breaches EU procurement regulations and that citizens' property rights are still not protected.

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Related Spanish property articles:
Spain property prices: Not so bad
Spanish property market review
Spanish property tax boost

For more information about Spanish property laws:
Law Overseas

Article published 12th July 2007