King Juan Carlos has officially abdicated

Spanish Royal Family attended the King Juan Carlos of Spain signs the Act of Abdication at the Royal Palace in Madrid. Juan Carlos, 76, signed the bill at a ceremony in the Royal Palace in Madrid, which was attended by only 160 guests.

At midnight local time (22:00 GMT), Felipe, 46, will become king although the event will not be marked in public until Thursday morning. The succession was endorsed by both of Spain's main political parties.

After Juan Carlos had signed the document that will end his rule, Prime Minister Mariano Rajoy also signed the law. Moments later, the assembled guests applauded, the prince's two daughters joined the royal group and the national anthem was played.

Felipe will head to the lower house of the Spanish parliament on Thursday for the first royal transition the country has seen since democracy was restored after the death of Gen Francisco Franco in 1975.

The ceremony at 10:30 local time will take the form of a proclamation rather than a coronation, in part because of the economic hardship that many Spaniards have experienced in recent years.

Juan Carlos, who has been king for 39 years, formally brought his reign to an end in the Hall of Columns at the 18th Century royal palace, the same room in which Gen Franco's body lay in state in November 1975.

Felipe will face the dual challenge of trying to rehabilitate a monarchy that has been damaged by recent scandals and trying to unify a country in which a vocal minority favour republicanism, BBC correspondent Chris Morris reports from Madrid.

King Juan Carlos has officially abdicated