The new sales division will be headed up by Josep Gonzalez and will continue to work out of the same office in St Cugat near Barcelona.
Gonzalez previously held senior sales positions at Torras Papel and Antalis, and has more than 22 years of experience in the paper industry.
Malcolm Sinclair, Tullis Russell sales and marketing director, said Iberia represents "a core part of our business".
He added that the move follows a year of successful growth in Spain and Portugal, according to the Scottish-headquartered paper manufacturer.
The Tullis Russell Group is an independent, wholly employee-owned papermaking, coating and converting company.