JOHN CARLOS I

KING OF SPAIN

To all who present it and understand it.

Sabed: That the General Courts have approved and I come to sanction the following law.

EXPLANATORY STATEMENT

I

This Law contains the transposition of Commission Directive 2006 /111/EC of 16 November 2006 on the transparency of financial relations between Member States and public undertakings, as well as on the financial transparency of certain undertakings, published in the Official Journal of the European Union of 17 November 2006.

Commission Directive 2006 /111/EC of 16 November 2006 sets out the codified version of Commission Directive 80 /723/EEC of 25 June 1980 on the transparency of the financial relations between the Member States of the European Union. Member States and public undertakings, as well as the financial transparency of certain undertakings, which has been amended on a number of occasions and in a substantial manner. Such codification was necessary for the sake of greater rationality and clarity.

II

The fundamental objective of this Law is to prevent abuse of a dominant position by companies that have granted special or exclusive rights or are in charge of the management of services of interest (a) the general economic situation, which will receive any kind of compensation for the public service and which will also carry out other activities, as well as the control of the existing financial relations between public undertakings and public administrations, State, regional or local level. It is ultimately about ensuring the financial transparency of these relationships.

III

This Law is divided into four chapters, consisting of 16 articles, three additional provisions and four final provisions.

Chapter I contains a single article that incorporates the object of the Law, consisting in ensuring the transparency of financial relations between public administrations, whether state, regional or local. public companies, providing information on the provision of funds by public administrations to these companies. The purpose of this Law is to ensure transparency in the management of a service of general economic interest or the performance of activities by virtue of the granting by those public administrations of rights. special or exclusive to any company, provided that it performs other activities other than the previous ones.

In Chapter II, which is composed of Articles 2 to 7, the obligations of public undertakings are regulated, the obligations of public undertakings are defined and the circumstances to be considered are laid down to be considered as such.

Public undertakings are obliged to draw up an annex, which shall not form part of the annual accounts and which shall be forwarded to the General Intervention of the State Administration, either directly or through the competent body, as appropriate, to remain at the disposal of the European Commission for five years from the end of the annual financial year during which the public funds have been made available or used. This Annex shall contain specific information on the provision of funds made by public administrations, whether directly or indirectly, their actual use, and the objectives pursued by those funds.

In Chapter III, which includes Articles 8 to 13, the obligations of undertakings which are to bear separate accounts are regulated. A company must draw up separate accounts when the public authorities at the state, regional or local level have granted special or exclusive rights or entrusted it with the management of a service of general economic interest, receive any compensation for managing that service and perform other activities.

These companies must make an annex that will not be part of the annual accounts and will also be referred to the General Intervention of the State Administration, directly or through the competent body, according to (a) shall be made available to the European Commission for a period of five years from the end of the annual financial year to which the information relates. This Annex shall contain information on the revenue and costs for each of the activities carried out, in addition to detailed information on the allocation and allocation methods used.

Both in the case of public companies and in the case of companies that are required to keep separate accounts, this Law indicates different types of companies that are not required to present such information. Additionally, it should be noted that activities covered by specific provisions will not be affected by the content of this Law.

Chapter IV, consisting of Articles 14 to 16, lays down the obligations of public undertakings in manufacturing, and points out that, for the purposes of this Law, manufacturing companies will be understood as manufacturing companies which perform their primary activity in this sector.

Public manufacturing companies shall have an obligation to refer to the General Intervention of the State Administration, directly or through the competent body, as appropriate, for subsequent submission to the Commission European, in addition to the annual accounts and the individual management report and, where appropriate, consolidated accounts, an annex containing detailed information on certain types of transactions and public interventions.

Finally, it should be noted that in all the chapters an article is included that provides that the responsibility in the elaboration and remission to the General Intervention of the State Administration of the information required in all the chapters shall be the responsibility of the business administration body.

CHAPTER I

General provisions

Article 1. Object.

This Law is intended to:

1. To ensure the transparency of financial relations between public administrations, whether state, regional or local, and public undertakings through the provision of information on the provision of funds, either directly or indirectly. indirectly, by public administrations to these companies, as well as their motivation and effective use.

2. To ensure transparency in the management of a service of general economic interest or the performance of activities under the concession, by public administrations, whether they are state, regional or local, of rights special or exclusive to any undertaking, where it also carries out other activities other than the previous ones, acts under competition and receives any kind of compensation for the public service, as well as imposing the obligation of to keep separate accounts and to report on the revenue and costs for each of the activities and about the allocation methods used.

CHAPTER II

Obligations of public companies

Article 2. Definition of public companies.

1. Public undertakings, for the purposes of this Law, are defined as any undertaking in which the public authorities may exercise, directly or indirectly, a dominant influence on the grounds of ownership, financial participation or rules. that govern it.

2. In particular, and in the field of the General Administration of the State, the entities referred to in Article 166 (1) of Law No 33/2003 of 3 November of the Heritage of the Administrations shall be regarded as public undertakings. Public.

3. In the regional and local area, the entities in which the circumstances referred to in the first paragraph of this Article shall be considered public undertakings shall be considered as public undertakings.

Article 3. Referral of information and content.

1. Public undertakings shall refer to the General Intervention of the State Administration, either directly, in the case of State-owned enterprises, or through the competent body of the Autonomous Community or the Local Entity, where (a) in the case of regional or local public undertakings, within seven months of the end of the financial year, an information annex which shall not form part of the annual accounts and which shall not be published.

2. The referral of the information prior to the General Intervention of the State Administration shall be made to the sole purpose of avoiding the dispersion of data and to provide the European Commission with such information in an aggregated manner.

3. The procedures for the referral of the information referred to in this Article shall be carried out by common agreement between the competent bodies.

4. The Annex referred to in paragraph 1 of this Article shall contain the following information

(a) Information on the provision of funds made by public administrations at the state, regional or local level, either directly or through other public undertakings or institutions financial,

b) Information on the effective use of such funds, and

c) Information on the objectives pursued in the granting of such funds.

Article 4. Conservation of information.

In order to avoid the dispersion of data and to provide aggregated information, the General Intervention of the State Administration shall keep the Annex referred to the provisions of the European Commission at the disposal of the European Commission. (a) the period of five years from the end of the annual financial year during which the public funds have been made available. If these funds are used in a subsequent financial year, the five-year period shall start counting from the end of that financial year.

Article 5. Purpose of making public funds available.

The making available of funds by public administrations, directly or indirectly to companies, will be made, among others, for any of the following purposes:

a) Compensation for operating losses;

b) Capital contributions;

(c) Lost contributions or loans granted under conditions other than those of the market;

d) The granting of financial advantages, whether in the form of no income or non-recovery of loans;

e) The waiver of remuneration on market conditions of the committed public funds; or

f) The compensation of charges imposed by public administrations.

Article 6. Responsibility of the governing body.

The management body of the public undertaking shall have responsibility for the elaboration and remission of the Annex containing the information referred to in Article 3 of this Law.

Article 7. Exemptions.

The obligation set out in Article 3 is waived for the following entities:

(a) Public undertakings, in respect of services the provision of which is not likely to affect trade between Member States in an appreciable manner;

(b) Public credit institutions, in respect of deposits of public funds made by public administrations under normal market conditions;

c) The Banco de España;

(d) Public undertakings whose net amount of the turnover at the closing date of each of the two years preceding which the public funds have been made available or used has been less than 40 € million; and

(e) Public credit institutions, the total amount of the assets of the asset not exceeding EUR 800 million, in the two previous years to which the public funds have been made available or used.

CHAPTER III

Obligations of companies to be held separate accounts

Article 8. Definition of a company required to keep separate accounts.

1. A company will be obliged to keep separate accounts for the purposes of this Law, when public administrations at the state, regional or local level have granted special or exclusive rights or entrusted to it the management of a service of general economic interest, receive any kind of compensation for managing that service of general economic interest or exploit those special or exclusive rights and carry out other activities.

2. Any right granted by public authorities, whether in a state, regional or local level, to an undertaking, by law, regulation or administrative decision, which is exclusively reserved for the public, shall be understood as exclusive right. that undertaking the right to provide a service or to undertake an activity in a specific geographical area.

3. Special rights shall mean any right granted by public administrations, whether at state, regional or local level, to a limited number of undertakings, by law, regulation or administrative decision, which in a specific geographical area:

(a) Limit two or more the number of undertakings authorised to provide a service or undertake an activity, by application of criteria other than objectives, proportionate and non-discriminatory, or

(b) Designate, in accordance with these criteria, several undertakings authorised to provide a service or undertake an activity, or

(c) Concedes to one or more undertakings, in accordance with those criteria, legal or regulatory advantages which substantially affect the ability of any other undertaking to provide the same service or to carry out the same business in the same geographical area under substantially equivalent conditions.

Article 9. Referral of information and content.

1. Any undertaking which is required to keep separate accounts shall, in the case of a company to which it has granted the special right or entrusted with the management of the State, send the General Intervention of the State Administration either directly or directly. service of general interest a State-wide public administration, or through the competent body of the Autonomous Community or the Local Entity, in the case of undertakings to which it has granted the special or entrusted right; management of the service of general interest a public administration at regional or local level, respectively, within seven months of the end of the financial year, an information annex which shall not form part of the annual accounts and which shall not be published.

2. The referral of the information prior to the General Intervention of the State Administration shall be made to the sole purpose of avoiding the dispersion of data and to provide the European Commission with such information in an aggregated manner.

3. The procedures for the referral of the information referred to in this Article shall be carried out by common agreement between the competent bodies.

4. The Annex referred to in paragraph 1 of this Article shall contain the following information

(a) Separate information on the revenue and costs for each of the activities carried out by the company; and

b) Detailed information about employee allocation and imputation methods.

Article 10. Conservation of information.

In order to avoid the dispersion of data and to provide aggregated information, the General Intervention of the State Administration shall keep the Annex referred to the provisions of the European Commission at the disposal of the European Commission. the previous Article for five years from the end of the annual financial year to which the information relates.

Article 11. Criteria for allocation and allocation of revenue and costs.

In the allocation and imputation of revenue and costs, the following criteria shall be taken into account:

(a) Each of the activities carried out by the company will be identified, with differentiation, in any case, between those developed by granting special or exclusive rights or management of services of interest General economic and other.

b) Each activity shall be assigned revenue and costs that correspond exclusively or directly to it and shall be charged with rational criteria, common to two or more activities.

(c) The allocation of common revenue and costs shall be based on criteria or indicators as objective as possible and shall be in accordance with the most common practices in this respect in the sector in which the undertaking carries out its activity, provided that the revenue and common costs charged to each activity are properly correlated.

(d) In accordance with the principle of uniformity, the criteria for allocation and imputation of revenue and costs shall be systematically established and applied, maintained in a uniform manner over time.

(e) The allocation and allocation criteria used shall be detailed and, where for exceptional and justified reasons, the criteria for allocation and allocation shall be made, account shall be taken of these reasons as well as of the impact quantitative of such changes, to this end the changes shall be deemed to occur at the beginning of the financial year.

Article 12. Responsibility of the administrative body.

The management body of the company shall be responsible for the elaboration and remission of the Annex containing the information referred to in Article 9 of this Law.

Article 13. Exemptions.

1. The obligation under Article 9 of this Law shall not apply to activities which are governed by specific provisions and shall also not affect the obligations imposed on undertakings engaged in such activities under those provisions. specific.

2. The obligation under Article 9 of this Law is waived for the following entities:

(a) Companies in respect of services the provision of which is not likely to affect trade between Member States in an appreciable manner;

(b) Companies whose net amount of the turnover at the closing date of each of the two financial years preceding the granting of a special or exclusive right or the granting of the management of an interest service The general economic situation is less than EUR 40 million. In the case of public credit institutions it is necessary that the total of the asset items does not exceed EUR 800 million; and

(c) undertakings entrusted with the management of services of general economic interest and which, whatever the compensation received, has been granted, for an appropriate period, in accordance with a procedure open, transparent and non-discriminatory.

CHAPTER IV

Obligations of public manufacturing companies

Article 14. Definition of public manufacturing companies.

1. It is understood by public companies that perform their main activity in the manufacturing sector, for the purposes of this Law, those companies whose ordinary activity, understood as that activity that is developed by the company regularly and for which it obtains periodic income representing at least 50% of the net amount of its turnover, whether the mechanical, physical or chemical transformation of materials, substances or components into new products.

2. In particular, undertakings carrying out any of the activities specified in the Annex accompanying this Law shall be deemed to comply with this definition.

Article 15. Referral of information and content.

1. Public undertakings which comply with the definition of Article 14 of this Law, and provided that the net amount of their turnover in the preceding financial year has been more than EUR 250 million, shall be sent to the General Intervention of the Administration of the State within seven months of the end of the financial year, the information contained in this Article. In the case of local and regional public undertakings, the submission of the above information shall be carried out through the competent authority of the Autonomous Community or the Local Entity.

2. The referral of the information prior to the General Intervention of the State Administration shall be made to the sole purpose of avoiding the dispersion of data and to provide the European Commission with such information in an aggregated manner.

3. The procedures for the referral of the information referred to in this Article shall be carried out by common agreement between the competent bodies.

4. The information to be submitted shall comprise the following documents:

(a) The annual accounts and the individual management report and, where appropriate, consolidated accounts, to be drawn up in accordance with the accounting rules applicable to them. In addition, the minutes of the general meetings of shareholders shall be attached.

(b) Without prejudice to the information to be provided in the memory of the individual and, where applicable, consolidated annual accounts, an annex which does not form part of these accounts, and which shall not be published, shall be included in the information regarding:

-Any type of public intervention, in particular, the remission of amounts owed to public administrations by the public undertaking, including, inter alia, the repayment of loans, grants, payment of the Corporation tax, social contributions and other similar payments.

-Detail of the transactions made by the public company with other companies in its group, with other groups of public companies, as well as those made directly between the public companies and the Administrations public.

Article 16. Responsibility of the administrative body.

The management body of the public company will have responsibility for the elaboration and referral of the information referred to in Article 15 of this Law.

Additional disposition first. Foral regime in the Basque Country and Navarre.

By virtue of its foral regime, the application to the Autonomous Communities of the Basque Country and Navarre as provided for in this Law shall be without prejudice to the provisions of the Law of the Economic Concert and the Convention of Navarre, respectively.

Additional provision second. Payment of deferred debts of health institutions with Social Security.

The health institutions that would have obtained the extension of the deficiency and the moratorium referred to the additional provision sixth of Law 42/2006, of December 28, of the General Budget of the State for the year 2007, as well as the successor of these institutions, which, in turn, have been granted deferrals for Social Security contributions generated after January 1995, may request from the General Directorate of the General Treasury of the Social security the remission of all the surcharges of arrears and prizes included in those charges deferrals, as well as the interest accrued on them since January 2007, provided that they are amortised in the entirety of the principal of the aforementioned deferrals within three calendar months of the publication of this Law.

Additional provision third. Depreciation of certain credits granted to Social Security.

One. During the financial year 2007 the General Treasury of Social Security will reimburse the Banco de España for the entire principal of the credits granted to the Social Security in the years 1990 and 1991, taking into account the current value of the debt pending them at the time of their payment. The repayment schedule provided for in the sixth transitional provision of Law 41/1994 of 30 December 1994 of the General Budget of the State for 1995 shall be without effect upon cancellation of the debt in its entirety.

Two. The budgetary amendment enabling the appropriations for the reimbursement of the entire principal referred to in the preceding paragraph shall not count as regards the percentage limits laid down in Article 57.2 of the General Law. Budget for the purpose of determining the jurisdiction to agree upon further credit supplements or extraordinary credits in the budget of the General Treasury of Social Security.

Final disposition first. Competence title.

This Law has the character of bases of the economic activity and bases of the legal regime of the public administrations, according to, respectively, the provisions of article 149.1.13. and 18. of the Constitution.

Final disposition second. Incorporation of European Union law.

By this Law, Commission Directive 2006 /111/EC of 16 November 2006 on the transparency of financial relations between Member States and public undertakings is incorporated into Spanish law. as to the financial transparency of certain companies.

Final disposition third. Enabling regulatory development.

The Government is empowered to issue the necessary provisions for the development and implementation of the provisions of this Law.

Final disposition fourth. Entry into force.

This Law shall enter into force on the day following that of its publication in the Official Gazette of the State.

Notwithstanding the foregoing, the content of Chapter III shall be mandatory for annual exercises that are initiated as of the entry into force of this Law.

Therefore,

I command all Spaniards, individuals and authorities, to keep and keep this law.

Madrid, 3 April 2007.

JOHN CARLOS R.

The President of the Government,

JOSE LUIS RODRIGUEZ ZAPATERO

ANNEX

This Annex contains the list of companies whose activities correspond to Section D, in particular, of subsection DA up to and including subsection DN of the statistical classification of economic activities in the European Community (rev. 1).

1. Food, beverage and tobacco industries.

2. Textile and clothing industry.

3. Leather and footwear industry.

4. Wood and cork industry.

5. Paper industry, editing, graphic arts and reproduction of recorded media.

6. Coke, oil refining and treatment of nuclear fuels.

7. Chemical industry.

8. Industry of the transformation of rubber and plastic materials.

9. Industry of other non-metallic mineral products.

10. Metallurgy and manufacture of metal products.

11. Construction industry of machinery and mechanical equipment.

12. Electrical, electronic and optical equipment and equipment industry.

13. Manufacture of transport equipment.

14. Miscellaneous manufacturing industries.