Over the years at Laduchi Consult, we have successfully implemented hundreds of projects and earned a high reputation among our clients. However, sometimes we make mistakes; we acknowledge them and are ready to discuss them openly. This way, we can see our shortcomings in detail, correct them, and grow. In this article, we want to share an anticase — a story about an oversight in our work with a client.
Due to the war in Ukraine, Spain, as well as Europe in general, introduced a preferential period for car registration for Ukrainians who received temporary protection there. This protection provides a residency permit, permission to work, the right to education, access to medical services, and other opportunities. Additionally, with this privilege, there's no need to pay high taxes for car customs clearance; hence, registering a car comes at a minimal cost.
Without the benefit of tax exemptions, one would have to pay around 30% of the car's value:
- VAT for customs clearance (21%)
- Customs duty (10%)
- Registration tax (from 4.75% to 16.75%)
- European homologation for Euro-6 (€2,000)
Under the preferential treatment, expenses are required only for technical inspection, tax registration, government fees, document translations, and, if necessary, mechanic work. The privilege to use this favorable system is granted only for one year from when the foreigner receives temporary protection or a TIE (Tarjeta de Identidad de Extranjero) residency card. After 12 months, it's no longer possible to use this benefit.
Knowing Laduchi Consult's expertise, Ukrainian clients turned to us not only for insights into business matters but also for personal ones, especially this legally intricate procedure. We were ready to assist new and returning clients who had previously worked with us and trusted our experts.
What's challenging about the procedure? During our operations, an issue arose with car registration due to the particularities of non-European vehicles. In Ukraine, purchasing vehicles not from European countries, like the USA, and tuning and tinting is common. Importing such vehicles is prohibited by European standards. We always alert our clients to potential legal challenges with these kinds of cars. Some knowingly take the risk, trying to bring in cars with an American VIN or too old vehicles. For a vehicle older than three years, registration becomes tricky; for one older than five, it's nearly impossible. Older cars need to meet current European standards.
Yet, even such challenges are surmountable by the experts at Laduchi Consult. When liaising with Spanish government institutions, we emphasized that our clients are forcibly displaced persons and stressed that the vehicles in question are their sole mode of transport, which they can't sell or return.
What's the problem?
At Laduchi Consult, we took on a challenging case: registering a car from Ukraine that happened to be an American model without a VIN code. Additionally, the vehicle's lights were of American standards, requiring adaptation to European specifications. Our experts discussed the timeline for the preferential customs clearance with the client and cautioned him about the limited timeframe for these tasks.
The client chose to bring the car up to “Spanish” standards and change the lights on his own, and this process dragged on. At the outset, we communicated to him that the preferential registration period is valid for a year from when he obtains residency. While this statement was correct, we shared it verbally rather than in writing. Given the absence of this agreement on paper, the client approached us a month before the preferential period's end, seeking clarity on its duration. Regrettably, we responded inaccurately, suggesting he had until his residency card expired. This was an oversight on our part since the card's validity extends beyond the preferential period. When the client reached out for further clarification, less than a month remained in the preferential window.
Given that previously, the dates were agreed upon verbally and weren't documented, we made an oversight. The wording of the Spanish law can be ambiguous, leading us to confidently believe the client had over a month left, which we conveyed to him.
This served as a green light for the client, and he proceeded with the car repairs. In reality, however, time was running out, and the preferential period was nearing its end. While our experts initially provided the client with the correct timeframes in line with the law, it's crucial to acknowledge that we subsequently misinformed him.
How did the case conclude?
We recognized the mistake and continued working with the client. Relying on the ambiguity of the phrasing in the law and our understanding of the workings of local government bodies, the lawyers at Laduchi Consult could still obtain Spanish numbers for the client under preferential registration.
The primary oversight on our part was to document the deadlines in writing. The specifics on paper would have shielded us from difficulties in this scenario. It would have protected us from disputes, and the client would always have the necessary, up-to-date information.
Regardless of the outcome, we've learned a valuable lesson from this situation and chose to share it publicly. At Laduchi Consult, we firmly believe that open communication with clients enhances the efficiency of our work and helps prevent future mistakes.
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