Mandatory financial guarantees in Spain, by activity

In short.

• Several Spanish laws make the right to carry on an activity conditional on providing a guarantee in favour of the authorities or of third parties: the successful bidder for a public contract (5% of the price excluding VAT, art. 107 LCSP), the temporary employment agency (25 times the annual minimum wage in the first year, then 10% of the payroll, art. 3 Law 14/1994), the developer taking advance payments on a home (100% of the sums paid plus statutory interest, 1st additional provision of the LOE)…
• The instrument is almost always the obligor's choice between a cash deposit, a bank guarantee and surety insurance, but not always: the LOE accepts only surety insurance or a joint and several guarantee, and the Private Security Act, "a bank guarantee or surety insurance". Read the specific provision before choosing.
• The guarantee must be kept in force and up to date: a temporary employment agency evidences the update in the first three months of each year (art. 8.3 Royal Decree 417/2015); a gaming operator has one month from the request to update it or may face revocation (art. 14.4 Law 13/2011); a public contractor replenishes it within 15 days (art. 109.2 LCSP).

Mandatory financial guarantees in Spain are not a one-off registration formality: they are a condition for continuing to operate. A temporary employment agency that fails to update its guarantee, a gaming operator that does not update it within the month following the request, or a developer that takes advance payments without surety insurance or a bank guarantee is exposed to losing its authorisation, to revocation or to answering to its buyers without any cover.

For a group operating across several regulated sectors, an occasional check when applying for a licence is not enough: it needs an inventory of live guarantees, with the governing provision, the beneficiary, the amount and the calendar for each. This guide sets out in a single table the surety bond requirements that Spanish and EU law impose on each activity.

What is a mandatory guarantee and how does it differ from compulsory insurance?

A mandatory guarantee is financial backing in favour of a beneficiary designated by the law itself —the authorities, agency workers, travellers, home buyers— that answers for specific obligations of the obligor: paying wages, refunding advance payments, settling a customs debt or a fine. If the obligor defaults, the beneficiary calls on it.

A compulsory liability insurance policy covers something else: the insured's own liability for damage caused to third parties. We deal with liability insurance required by law separately. And some laws require both at the same time: the Private Security Act requires liability insurance or other financial guarantees (art. 19.1(e)) and, in addition, a bank guarantee or surety insurance for administrative liability arising from infringements (art. 19.1(f)).

Where the guarantee is provided through insurance, the instrument is the seguro de caución (surety insurance) defined in article 68 of the Spanish Insurance Contract Act: if the policyholder breaches its statutory or contractual obligations, the insurer indemnifies the insured for the financial loss suffered, within the limits set by law or by the contract. That is why it sits alongside bank guarantees and bonds as a way of meeting the same requirement.

Table: which guarantee Spanish law requires for each activity

Activity	Legislation	Beneficiary / what it answers for	Amount	Accepted instruments
Successful bidder for a public contract	LCSP arts. 107-110	Contracting authority: performance of the contract and penalties	5% of the price excl. VAT (+ up to 5% supplementary)	Cash or securities, bank guarantee, surety insurance, withholding from the price
Temporary employment agency	Law 14/1994 art. 3; Royal Decree 417/2015 arts. 8-11	Labour authority: wage, compensation and Social Security debts owed to agency workers	25 × annual minimum wage in year one; then 10% of payroll (min. 25 × minimum wage)	Deposit with the Caja General de Depósitos, bank guarantee or joint and several surety, insurance policy
Organiser or retailer of package travel	TRLGDCU art. 164	Travellers: refunds and repatriation in the event of insolvency	Set by the competent authority (autonomous community) using the criteria in art. 164.2	Guarantee fund, insurance, bank guarantee or other financial guarantee
Developer taking advance payments	LOE 1st additional provision	Buyer: refund if building work does not start or is not completed	Sums paid + taxes + statutory interest	Individual surety insurance per buyer or joint and several bank guarantee
Hazardous waste manager (bond) and hazardous waste producer (insurance)	Law 7/2022 arts. 20.6 and 23.5(b) and (c)	Authorities (bond); third parties and the environment (insurance or guarantee)	Set by regulation or by the autonomous community	Bond + insurance or equivalent guarantee
Importer or customs declarant	Regulation (EU) 952/2013 arts. 89-95	Customs: customs debt (duties and other charges)	Exact amount or, where not possible, the highest amount estimated (art. 90)	Cash deposit, undertaking by a guarantor (which may be an insurer), other equivalent form
Gaming operator with a general licence	Law 13/2011 art. 14	Prizes, penalties and fees	Set by regulation	On the terms and in the forms set by regulation
Private security company	Law 5/2014 art. 19.1(e) and (f)	Authorities: administrative liability for infringements (bank guarantee or surety)	Set by regulation	Bank guarantee or surety insurance
Auditor or audit firm	Law 22/2015 art. 27	Third parties: damage caused in the course of the activity	Proportionate to turnover	Deposit, public debt, bank guarantee, liability insurance or surety
Operator listed in Annex III (environmental liability), save for the art. 28 exemptions	Law 26/2007 arts. 24, 26 and 28	Environmental liability	Determined by the operator on the basis of its risk analysis	Insurance, bank guarantee, technical reserve
Electricity generator applying for grid access	Royal Decree 1183/2020 art. 23	Body authorising the installation: secures obtaining the operating authorisation (released once obtained)	€40/kW installed	Prior financial guarantee (see the energy sector page)

For several of them, the specific amount is set by regulation or by the autonomous community: confirm the figure in force with the competent body.

Public procurement: the provisional and the definitive guarantee

The successful bidder for a public contract provides a definitive guarantee (garantía definitiva) of 5% of the final price tendered, excluding VAT (art. 107.1 of Law 9/2017 on Public Sector Contracts, Ley de Contratos del Sector Público, LCSP), unless the tender documents waive it on justified grounds, which is not possible for works contracts or works concessions (art. 107.1). In special cases the tender documents may require a supplementary guarantee of up to a further 5% (art. 107.2). The provisional guarantee is the exception: only where the contracting body justifies it, and never above 3% of the base tender budget excluding VAT (art. 106). It may take the form of cash or securities, a bank guarantee, surety insurance or, where the tender documents allow, withholding from the price. If it is called to collect penalties, the contractor must replenish it within 15 days or face grounds for termination (art. 109.2).

Calculation, release and forfeiture are covered in definitive guarantee under the LCSP, and the full set of covers for those tendering for works, in insurance for construction companies.

In private construction, by contrast, no law sets that 5%: advance payment, performance, retention and maintenance guarantees are agreed in the contract and, in EPC contracts, are known as performance bonds.

Employment and consumer guarantees: temporary employment agencies and travel agencies

Temporary employment agencies

A temporary employment agency (empresa de trabajo temporal, ETT) cannot obtain its authorisation without providing a guarantee at the disposal of the labour authority: 25 times the annual statutory minimum wage (salario mínimo interprofesional, SMI) in the first year and, thereafter, 10% of the previous year's payroll, never below those 25 times the minimum wage (art. 3.2 of Law 14/1994 regulating temporary employment agencies; art. 8.2 of Royal Decree 417/2015). As the minimum wage is revised by royal decree, the euro figure changes every year.

The agency's financial guarantee may take the form of a deposit with the Caja General de Depósitos (the State deposit office), a bank guarantee or joint and several surety from a financial institution, or an insurance policy. It is updated every year, and the update must be evidenced to the labour authority within the first three months of the calendar year (art. 8.3 Royal Decree 417/2015).

It answers for compensation, wage and Social Security debts owed to agency workers. It is called for debts acknowledged in conciliation or by final judgment and, for contributions, through an enforcement order (art. 10 of the Royal Decree). If the agency ceases trading with no outstanding debts, the guarantee is returned (art. 3.5 of the Law; art. 11 of the Royal Decree).

Organisers and retailers of package travel

Article 164 of the consolidated text of the General Law for the Protection of Consumers and Users (texto refundido de la Ley General para la Defensa de los Consumidores y Usuarios, TRLGDCU) requires them to provide protection against insolvency —a guarantee fund, insurance, a bank guarantee or another financial guarantee— "on the terms determined by the competent authority". It covers the refund of travellers' payments, including those made in peak season, and their repatriation where transport is included. Cover may be calculated on the basis of the previous year's package travel turnover, and must be adjusted if the risks increase (art. 164.2). The obligation also applies to operators established outside the EU that sell in Spain. It is distinct from the guarantee of contractual liability towards travellers required by article 165.

The amount and form are set by each autonomous community's tourism legislation: there is no single national figure. Before replacing a travel agency's bank guarantee or bond with surety insurance, it is advisable to check what the autonomous community accepts.

Does your activity require a guarantee in favour of the authorities? We review which instrument your legislation accepts.

Guarantees in property development: advance payments

The first additional provision of the Building Act (Law 38/1999, Ley de Ordenación de la Edificación, LOE) requires any developer receiving advance payments on a home, from the time the building permit is granted, to guarantee their refund by means of surety insurance or a joint and several bank guarantee —a deposit is not accepted— and to pay them into a special account, kept separate from any other funds of the developer.

The policy must meet set requirements: it is issued individually for each buyer; the sum insured comprises the amounts paid, taxes and statutory interest; the developer is the policyholder and the buyer the insured; non-payment of the premium cannot be raised against the insured; and its term may not be shorter than the delivery commitment. If the work does not start or is not completed on time, the buyer makes a formal demand for repayment to the developer and, if the developer does not pay within 30 days, claims against the insurer, which must indemnify within a further 30 days. The special account, release and claims are covered in detail in off-plan deposit guarantees.

Activities with environmental or fiscal risk: waste, environment and customs

Waste. Law 7/2022 on waste and contaminated soils for a circular economy requires hazardous waste managers (and other managers where their specific legislation so provides) to lodge a bond that answers to the authorities for compliance with the obligations of the activity and of the authorisation or notification (art. 23.5(b)). Dealers, carriers and entities treating hazardous waste must also hold insurance or an equivalent financial guarantee covering death or personal injury, property damage and the costs of environmental repair and restoration (art. 23.5(c)). Producers of hazardous waste need it too, except those generating less than 10 tonnes a year (art. 20.6). The amounts are set by regulation; who is bound and how Royal Decree 208/2022 sets them is explained in waste financial guarantees. We place this within the wider sector picture in insurance for industrial companies.

Environmental liability. Operators listed in Annex III of Law 26/2007 on Environmental Liability must hold a financial guarantee —insurance, a bank guarantee or a technical reserve— whose amount the operator itself determines on the basis of a risk analysis (art. 24), save for the exemptions in art. 28: potential damage below €300,000, or between €300,000 and €2,000,000 with EMAS or ISO 14001. When environmental insurance is compulsory is explained separately, and the cover itself on our environmental liability insurance page.

Customs. The Union Customs Code distinguishes the compulsory guarantee, which covers a customs debt that has arisen or may arise, for its exact amount or the highest amount estimated (arts. 89 and 90), from the optional guarantee, which customs may require where it is not certain of being paid (art. 91). It is provided by cash deposit, an undertaking by a guarantor or another equivalent form (art. 92), and the guarantor may be an insurance company accredited in the Union (art. 94.1). When it is required, how it is calculated and when it can be reduced: see customs guarantee. It is a regular component of insurance for logistics companies.

Gaming, private security, auditing and energy

Gaming. An operator holding a general licence provides a guarantee answering for prizes, penalties and fees (art. 14 of Law 13/2011 regulating gaming); individual licences may require additional guarantees. It must update the guarantee within one month of being asked to do so, failing which revocation may follow, and may apply for its return when appropriate.

Private security. In addition to liability insurance, the company maintains the bank guarantee or surety insurance required by article 19.1(f) of Law 5/2014 on Private Security. We analyse it in the article on the Private Security Act.

Auditing. Article 27 of Law 22/2015 on the Audit of Accounts requires auditors and audit firms to hold a financial guarantee proportionate to their turnover: deposit, public debt, bank guarantee, liability insurance or surety. More detail in insurance for professional firms.

Energy. Anyone applying for grid access for a generation facility first provides a guarantee of €40/kW installed (art. 23 Royal Decree 1183/2020). Exemptions and the form it may take are covered in insurance for energy companies. A different one is the guarantee that several autonomous communities require to remove the installation and restore the land at the end of its useful life: the decommissioning bond for solar and wind farms.

Bank guarantee, deposit or surety insurance? How to choose the instrument

First, what the legislation accepts. The choice is not always free: the LOE accepts only surety insurance or a joint and several bank guarantee, and the Private Security Act, a bank guarantee or surety insurance. The LCSP, the rules on temporary employment agencies, the Audit Act and the environmental liability legislation widen the range. Read the specific article and, where relevant, the tender documents or the regional legislation.

Second, the balance-sheet effect. A deposit ties up cash; a bank guarantee and surety insurance do not, but a bank guarantee consumes risk capacity on the facility with the bank, which is then no longer available to finance the business. The differences are set out in bank guarantee vs surety insurance, and the product itself on our surety insurance page.

Third, the overall view. A group that tenders, supplies agency workers and imports goods holds guarantees before different bodies at the same time, each with its own expiry dates. Managing them as a programme, with a surety facility sized to cover them all, brings order to the calendar and avoids arranging them one guarantee at a time. The issue of any surety or bank guarantee depends on the issuing entity's assessment of solvency: neither acceptance nor cost is guaranteed in advance. What happens if the beneficiary makes a demand is explained in calling a surety bond.

If you hold several live guarantees, it is advisable to manage them as a programme. Request a review of your surety facility.

The role of an independent broker

As an independent brokerage registered with the Spanish DGSFP under reference J0140, we act on the client's mandate, not that of the entity issuing the guarantee. For each of the group's activities we identify which guarantee the legislation requires, before which body and for what amount; we choose the instrument that legislation accepts; we place the surety facility in the market with the financial information each entity requires; and we monitor the calendar so that no guarantee lapses or stays tied up longer than necessary.

We build the inventory of the guarantees your activity requires, choose the accepted instrument and follow up its updates and releases, with no obligation. Talk to us.

Frequently asked questions

What guarantee amount does a temporary employment agency need? For authorisation and the first year, 25 times the statutory minimum wage in force, calculated on an annual basis; thereafter, 10% of the previous year's payroll, never less than 25 times the minimum wage (art. 3.2 Law 14/1994; art. 8.2 Royal Decree 417/2015). The euro figure is recalculated with the minimum wage in force.

Can a travel agency meet its guarantee requirement with insurance? Yes. Article 164.1 of the consolidated text of the General Law for the Protection of Consumers and Users accepts a guarantee fund, insurance, a bank guarantee or another financial guarantee, on the terms determined by the competent authority.

Can a developer take advance payments on a home without a bank guarantee or surety insurance? No. From the time the building permit is granted, the developer must guarantee repayment with surety insurance or a joint and several bank guarantee and collect the payments into a special account (first additional provision of the LOE).

Can an insurer act as guarantor before customs? Yes. The guarantor must be established in the Union and approved by customs, unless it is a credit institution, a financial institution or an insurance company accredited in the Union (art. 94.1 of Regulation (EU) 952/2013).

What happens if a mandatory guarantee is not updated? It depends on the legislation. In gaming, failing to update it within one month of the request may lead to revocation (art. 14.4 Law 13/2011); in public procurement, failing to replenish it within 15 days is grounds for termination (art. 109.2 LCSP); and a temporary employment agency must evidence the update in the first quarter of each year (art. 8.3 Royal Decree 417/2015).

Sources and legislation

• Law 9/2017 on Public Sector Contracts (Ley de Contratos del Sector Público), articles 106 to 110.
• Law 14/1994 regulating temporary employment agencies, article 3.
• Royal Decree 417/2015, Regulations on temporary employment agencies, articles 8, 10 and 11.
• Royal Legislative Decree 1/2007, consolidated text of the General Law for the Protection of Consumers and Users, article 164.
• Law 38/1999 on Building (Ley de Ordenación de la Edificación), first additional provision.
• Law 7/2022 on waste and contaminated soils for a circular economy, articles 20.6 and 23.5.
• Law 13/2011 regulating gaming, article 14.
• Law 5/2014 on Private Security, article 19.
• Law 22/2015 on the Audit of Accounts, article 27.
• Law 26/2007 on Environmental Liability, articles 24, 26 and 28.
• Royal Decree 1183/2020 on access to and connection to electricity transmission and distribution networks, article 23.
• Regulation (EU) 952/2013 laying down the Union Customs Code, articles 89 to 95.
• Law 50/1980 on Insurance Contracts, article 68.

This guide describes the Spanish national and EU legal framework. The specific amount, the accepted form and the body before which each guarantee is provided may depend on a regulation, on the autonomous community or on the tender documents: confirm them with the competent body before providing the guarantee. The issue of surety insurance or a bank guarantee is subject to the issuing entity's assessment of solvency. This information is for guidance only and does not constitute legal or binding advice. New Brokers Correduría de Seguros, S.L., registered with the DGSFP under reference J0140.