Spain Faces EU Infringement Proceedings for Failure to Implement Key Directives

Introduction: Spain and non-compliance with EU law

The European Commission has opened infringement proceedings against Spain for failing to transpose on time the latest amendments to Directive (EU) 2015/849 on the prevention of money laundering and terrorist financing (the Sixth AML Directive). This case adds to other recent notices concerning VAT rules and the identification of critical entities within the EU’s economic-security framework.

This article reviews the proceedings, their legal implications, the Commission’s deadlines and the risks Spain faces if it does not remedy the situation in the coming months.

1. First formal warning to Spain over the Anti-Money Laundering Directive

The Commission has notified Spain, together with Belgium, Poland and Portugal, that it is opening infringement proceedings for failure to transpose the latest amendments introduced by Directive (EU) 2018/1673. These amendments focus on preventing the financial system from being used for money laundering, with particular attention to the misuse of crypto-assets.

Objectives of the new rules

• Strengthen the EU legal framework on preventing money laundering and terrorist financing.
• Harmonise the traceability of digital assets.
• Require Member States to establish effective penalties for detected infringements.

Consequences of non-compliance

The letter of formal notice opens a two-month period for Spain to respond and demonstrate the measures adopted or underway. Otherwise, the Commission may issue a reasoned opinion and, if non-compliance continues, refer the case to the Court of Justice of the European Union (CJEU), with possible coercive financial penalties.

2. Reasoned opinion on reduced VAT for essential products

The Commission has also issued a reasoned opinion to Spain, along with Belgium, Bulgaria, Greece and Romania, for failing to transpose directives that allow reduced or even zero VAT rates on basic goods, including:

• Essential food products.
• Medicines and medical devices.
• Energy supplies and drinking water.

Legal framework: Directive 2022/542

These amendments, adopted through Directive (EU) 2022/542, gave Member States greater tax flexibility during inflation and economic crises. The deadline for transposition was 31 December 2024, which Spain missed.

3. Failure to adapt the special VAT scheme for SMEs

The third proceeding concerns Directive (EU) 2020/285, which reformed the special VAT scheme for small businesses. It allows SMEs to operate without charging VAT up to certain turnover thresholds and reduces their formal obligations, with the aim of supporting entrepreneurs and microbusinesses.

Spain has not completed the transposition of this simplified scheme, preventing it from being applied in practice within the national tax system.

4. Failure to transpose the Critical Entities Directive

The final infringement identified by the Commission concerns Directive (EU) 2022/2557, which aims to identify and protect critical entities essential to the EU economy and security in sectors such as:

• Energy.
• Transport.
• Healthcare.
• Banking.
• Water and digital infrastructure.

The Commission considers that Spain has not yet legislated the mechanisms needed to comply, breaching the deadlines and principles governing the transposition of EU law.

Conclusion: risks for Spain and a call for legislative action

Spain faces four infringement proceedings, two of which have already reached the reasoned-opinion stage, the step before litigation before the CJEU. Failure to comply with these directives may have significant legal and economic consequences, including financial penalties and damage to Spain’s institutional standing in the EU.

These proceedings point to poor coordination of national legislation, particularly in taxation, anti-money laundering and economic governance. The Government and Parliament need to act urgently to bring Spanish law into line with the country’s European commitments.