The Council of Ministers yesterday approved Royal Decree-Law 8/2023, of 27th December, adopting measures to deal with the economic and social consequences of the conflicts in Ukraine and the Middle East, as well as to alleviate the drought effects.
The Royal Decree-Law of 27th December introduces modifications to Law 19/1994 of 6th July 1994, amending the Economic and Fiscal Regime of the Canary Islands, with effect from 1st January 2024.
In this sense and regarding the Canary Islands Special Zone, the temporary references contained in the aforementioned Law are eliminated, modifying Article 29 of the aforementioned Law with regard to the terms of validity of the ZEC, which, due to its nature, needed to be updated on a recurring basis, thereby eliminating the obligation of periodic review and the granting of extensions.
This amendment consolidates in the national legislation the period already recognized by the European Commission to enjoy the tax benefits of the Canary Islands Special Zone Regime, introducing direct references to the European Union rules or those derived from the documents of the European Commission which give them legal support, in accordance with the procedure currently established for this type of State aid which does not require the prior permission of the European Commission.
Indeed, from 2024 the Canary Islands Special Zone will be subject to the European Union regulations on State aid and will not be subject to the reviews and extensions which have been applicable to date.
This measure is a further step towards the necessary and permanent strengthening of legal certainty, the main guarantor of our economic and fiscal regime, in view of the frequent uncertainty caused to investors in the ZEC framework who each year find themselves in the situation of not knowing whether they will be able to continue in the ZEC.
The new wording of Article 29 of Law 19/1994, of 6th July 1994, amending the Canary Islands Economic and Fiscal Regime, is transcribed verbatim in Spanish:
«Artículo 29. Vigencia de la Zona Especial Canaria.
1. Los incentivos fiscales previstos para las entidades de la ZEC en el Título V de esta ley podrán disfrutarse durante los seis años inmediatos posteriores a la finalización de la vigencia del Reglamento (UE) 651/2014 de la Comisión de 17 de junio de 2014 por el que se declaran determinadas categorías de ayudas compatibles con el mercado interior en aplicación de los artículos 107 y 108 del Tratado, o de la norma que lo sustituya, y se podrán prorrogar, si así́ lo dispone la normativa en materia de ayudas de Estado aplicable a Canarias, previa comunicación de la Comisión Europea.
2. La autorización de la inscripción en el Registro Oficial de Entidades de la Zona Especial Canaria tendrá́ como límite la fecha establecida en el artículo 59 del citado Reglamento (UE) 651/2014 de la Comisión de 17 de junio de 2014, para la finalización de su vigencia o la de la norma que lo sustituya.
3. El mantenimiento de la Zona Especial Canaria estará́ condicionado en todo caso al resultado de las revisiones periódicas que deba realizar la Comisión Europea.»
