Tax on discount at purchase.

Exemption may apply provided certain requirements are met.

Tax on sale.

Generally allowed, if subsidiary bears the cost of award, even if without reimbursement, based on a recent tax ruling.

Income Tax:
Yes, payment‑on‑account / withholding and reporting required, unless exemption applies.

Social Insurance Contributions:
Yes, employee and employer contributions due unless monthly ceiling has already been met.

Employer must withhold employee's contributions.

The EU Prospectus Regulation is in effect in all European Economic Area countries, which includes all EU member states, Iceland, Liechtenstein and Norway ("EEA"). ESPP purchase rights are considered a public offering of securities for purposes of the EU Prospectus Regulation.

An EU-compliant prospectus will be required for the offer of an ESPP in any EEA member state, unless an exemption or exclusion applies. A "small offering exemption" is available if the offer is made to less than 150 persons in a member state. An "employee share scheme exemption" is available if the offer is made to existing or former employees (or directors), provided the offerees are provided with a short disclosure document that contains certain prescribed information about the offer. An exclusion for offers under a certain value threshold across the EEA may also be available.

Additional requirements may apply if relying on certain exemptions/ exclusions or if a prospectus must be filed.

Please contact Baker McKenzie for more information.

Employee reporting requirements apply.

Written disclaimer recommended acknowledging voluntary nature of plan and that employee has received copy of plan. Spanish Supreme Court cases have held that the benefit received from option grants must be included in the calculation of severance payments and that terminated employees may have the right to exercise unvested options or continue to vest in options after termination. It is uncertain if/ how this case law applies to ESPP. We recommend inserting disclaimer and

U.S. choice of law language, but there is no guarantee that Spanish courts will uphold.

Exclusion of part-time employees may be deemed discriminatory.

The EU Council Directive 2000/78/EC prohibits age discrimination. Most, if not all, countries have adopted local rules implementing this Directive, which may have an impact on design of equity and other incentive plans in the EU, particularly on age or age and service provisions which give different treatment (e.g., accelerated or continued vesting) for those meeting the criteria.

A valid basis is required to collect, process and transfer personal data.

The EU Data Protection Regulation ("GDPR") became effective in all EU/EEA countries on 25 May 2018. It introduces new requirements and increases the powers of data protection authorities, rights of data subjects and potential penalties for non-compliance.

Accordingly, companies should review their approach to data privacy compliance in the context of equity plan administration and consider on which basis they may be able to rely to collect, process and transfer data.

Registration and notification requirements with local data privacy authorities may also apply.