Canary Islands Special Zone Regulation
TITLE V The Canary Islands Special Zone (as amended by Royal Decree-Law 12/2006)
The Canary Islands Special Zone is a low tax zone authorised by the European Commission, which offers such advantages as a 4% in the Corporate Income Tax compared to the 20-25% payable in the rest of the Spanish territory.
Companies who decide to become a ZEC entity will enjoy, in addition, other tax benefits as a low tax rate in the income of non-residents tax and the total exemption of indirect taxation by those activities developed within the area of operation.
To be located in the Spanish territory, ZEC entities are eligible according to the double imposition treaties of Spain and the Directive of the European Union on societies on Parent companies and Branches.
The ZEC was authorised by the European Commission in January 2000, and by the Royal Decree-Law 2/2000 of 23 June.
After it has been amended by the Royal Decree/Law 12/2006 of 29 December and developed by the Royal Decree-Law No. 1758 / 2007 of 28 December (regulation of the REF in the Canary Islands).