By Rodrigo De Miguel and Sarah White
MADRID (Reuters) - Cristina de Borbon, sister of Spain's King Felipe VI, is to stand trial on tax fraud charges as soon as next year, becoming the first Spanish royal to face prosecution.
Princess Cristina's father Juan Carlos abdicated in June after a series of scandals, and his son Felipe is riding high in opinion polls. He has tried to modernize the monarchy and has taken away rights and duties from his two sisters, neither of whom is now formally part of the royal family.
Prosecutors have been conducting an investigation into the affairs of Cristina's husband, former Olympic handball player Inaki Urdangarin, for four years.
They have ordered Cristina, 49, Urdangarin and 15 others to stand trial in the case involving his Noos Foundation charity, the High Court of the Balearic Islands said on Monday.
Graft investigations in Spain have exposed high-level corruption among politicians, trade unions and bankers among others, and have eroded Spaniards' faith in their institutions after a major economic crisis and a government austerity drive.
As Spain heads into a general election year, corruption will be high on the political agenda. Polls show the issue as Spaniards' second biggest concern after sky-high unemployment.
New anti-establishment party Podemos - "we can" in Spanish - has already benefited from the disaffection, and threatens to eat away at support for mainstream political leaders, including those from the ruling center-right People's Party (PP) and the opposition Socialists.
Cristina and her husband have both denied any wrongdoing in the case, triggered by a complaint from anti-graft campaigners Manos Limpias - "clean hands" in Spanish.
Urdangarin has been charged with breach of legal duty, embezzling public funds, fraud, influence-peddling and money-laundering. The princess is accused of two tax crimes.
Her lawyer Miquel Roca said on Monday said she had been surprised by the court order. Spanish law can allow the accused to escape trial if the victim of a crime - in this instance, the Spanish state - does not back the charges, as was the case here.
He said Cristina would be launching an appeal based on that.
"It's a serious, surprising and exceptional situation," Roca told journalists.
The couple have been ordered to deposit funds with the court to cover possible liabilities - 2.6 million euros ($3.2 million) in the case of Cristina, and nearly 15 million for Urdanganrin.
They now have 20 days to deposit the money, according to a written court ruling, or face having assets seized.
Cristina remains sixth in line to the throne.
A spokesman for the royal household declined to comment on whether the princess would give up her succession rights.
(Additional writing by Sonya Dowsett; Editing by Louise Ireland)