Global Find

Global Find is a product developed in Web environment that answers the need of identifying solutions for the location of companies in the continental national territory, aiming to assist Industrial and Logistics Companies in search of a new location.

Based in a GIS (Geographic Information Systems) platform, the Global Find identifies location alternatives in industrial or logistic parks with available lots.

Through the website, Global Find enables free search on a map or the identification of location alternatives following the selection of infrastructural, demographic and socio-economic criteria, previously defined and made available to the users.

Only a click away and you may gain access directly on the map to the characterization and description of several interesting items on industrial or logistic contextualization such as Ports and Harbour Terminals, Airports, Logistic Platforms, amongst others.

With free access via internet, Global Find enables you to find the best location for your investment based on the following search criteria:

- Typology of Space
- Localization Nut III
- Area
- Infrastructures (main roads, ports, airports, logistic platforms)
- Economic Activities
- Business Centres and Knowledge Centres
- Demography
- Education Level

At Global Find you can carry out:
- Multiple criteria search
- Map navigation
- Search through keywords
- The Print of Reports - Socio-Economic, Lot and Comparative Context

In order to access these features, you should enter in Global Find, and register free of charge, after which you will receive a password by email.

Consulting Services

The Global Force Consulting services made available for the Investors are carried out by experts of aicep Global Parques who provide personalized services of selection and support to the choice of location for your investment.
The available services begin with the listing of requisites submitted by the client, search of suitable space, and promotion of contacts with the entity managing the spaces, always combined with the interpretation of comparative analysis reports.
aicep Global Parques provides the investor with a competent and dynamic team, ready to help in order to ensure that the implementation of the Project will take place swiftly and efficiently.

Contact Global Find through the email address
Think Global, Think Portugal.
Global Find
Your Investment in the Right Place.

Central Services
Rua da Artilharia Um, 79- 7º
1250-038 Lisboa
T: +351 213 827 750
F: +351 213 860 900

Click on the image below to begin your location search

Investment in PORTUGAL

Setting up a Company in Portugal
Investment Incentives
Special Investment Considerations
Regional and International Trade Agreements and Associations
Major Trading Partners
Importing and Exporting

Setting up a Company in Portugal

Portugal as an investment location offers a strategic access to markets, proactive investment reforms, cost-competitive, qualified and flexible workforce, strategic commitment to education and science, and an excellent environment to live and work.

API – Agência Portuguesa para o Investimento was created in November 2002 representing a new era for doing business in Portugal, with the mission to promote investment in Portugal. This means attracting more projects (from new and existing investors), but also higher value-adding initiatives. The Agency was created in a context of change and strong commitment to structural reform, aimed at enhancing Portugal’s attractiveness as an investment location. At the moment API is the single

In order to set up and legally incorporate a company in Portugal it is necessary to:

  1. Chose the sector of activity and determine the scope / corporate object of the company
  2. Chose the most convenient legal form of company to be set up
  3. Chose a name for the company and request of the Official Certificate of Admissibility for the chosen name. To obtain a name for the company. The following information is required:
    • Name of the investor – could be an individual or a company (we would suggest that only one investor should be named as this is the simplest method as it is only necessary to register the statutes with the Company Registry)
    • Three company names (assistance on the advisability of the suggested names may be provided)
    • Legal form of company (we would suggest that you form a “Sociedade Unipessoal por Quotas”. This type of legal entity is a limited company in which no shares are involved. The investor is named in the statutes of the company and the sale of transfer of the quotas can only be effected by alteration of the statutes
    • The area in Portugal where the registered office will be located (say Lisbon)
    • The object clauses of the company

  4. Obtain a provisional tax number for the company
  5. Elaborate the "Articles of Incorporation/Association"
  6. Deposit the minimum legal capital of €5,000 in a bank account subscribed by the future company and a certificate obtained confirming that the capital has been deposited
  7. Effect the public deed of incorporation. Drafting powers of attorney for the formation of the company to be executed by the investor and obtain a certified translation of these powers
  8. Register the initiation of activity "Declaração de Início de Actividade" at the Tax Department for value added tax and corporation tax
    • Estimate that the cost of incorporating the company would be as follows:
    •   Euro
      Legal Fees 1,250
      Expenses 500
  9. Enrol the company at the local Commercial Registrar
  10. Publish the deed in the official newspaper "Diário da República" and in a local newspaper
  11. Enrol the company at the Social Security Department
  12. Registering the minute book with the Commercial Registry and the Tax Department

Forms of Enterprise

A foreign investor intending to carry out business in Portugal may choose from various forms of business enterprises, including companies, joint ventures, and branches of foreign companies, partnerships and trusts.

Different forms a company may be adopted:

  • Private Limited Liability Company - "Lda." (sole trader or plural)
  • Corporation - "SA"
  • Holding Companies - "SGPS"
  • General Partnerships - "SNC"
  • Joint Ventures
  • Trusts
  • Branches of Foreign Companies

In practice, Private Limited Liability Companies - "Lda." and the Corporations - "SA" are the most widely used types. Smaller businesses and subsidiaries of foreign multinational corporations generally adopt the Lda. form, which has fewer formalities.

Designation: Private Limited Liability Company (Lda.)

  • Name of the company followed by "Lda."
    • Share Capital (corporate capital) - Minimum of €5.000 and €100 per contribution.
    • Number of partners - Minimum of 1
    • Normalities required - Public notary act and registration in the Commercial Registrar
    • Responsibility/liability - Limited to contribution
    • Administration - Managers
    • Taxes Payable:
      • Income Tax: IRC - 23%
        (The first 15.000Eur of taxable income is taxed at the rate of 17% for small and medium businesses.)
      • Expenses tax: IVA - 23%, 13% and 6%
    • Advantages:
      • Low number of partners
      • Low minimum capital
      • Large intervention of the partners in management

Designation: Corporation - "SA"

  • Name of the company followed by "SA"

    Larger businesses and public companies use the SA form. Shares in an SA are generally transferable, but quotas cannot be transferred without permission of the company. The transfer must be made through a notary deed.
    • Share Capital (corporate capital) - Minimum of €50.000 and €1 cent per share
    • Number of partners - Minimum of 5
    • Formalities required - Public notary act and registration in the Commercial Registrar
    • Responsibility/liability - Limited to contribution
    • Administration: - Board of Directors
    • Taxes Payable:
      • Income Tax: IRC - 23%
      • Expenses tax: IVA - 23%, 13% and 6%
    • Advantages:
      • Large number of partners
      • Dispersed capital
      • Share transmission
      *The choice of one of the above companies depends on different factors such as:
      • The share capital available
      • The type of administration requested
      • The area of activity

Designation: Holding Companies - "SGPS"

Decree Law 495/88, of 30 December 1988 created the pure holding company (Sociedade Gestora de Participações Sociais or SGPS), which owns and manages investments. In general, each investment held by the SGPS must represent at least 10% of the share capital of the associated company and must be held for a minimum period of one year. An SGPS may own less than 10% of an associate company’s share capital if one of the following situations exists:

  • According to the last approved balance sheet of the SGPS, the shareholdings of the SGPS in the associated company do not exceed 30% of the total value of the holdings in other associated companies and the shareholdings of the SGPS in the associated company represent at least 10% of the share capital with voting rights in such company
  • The acquisition value of the participation is at least €4.99 million
  • The participation derives from a merger or spin-off of the associated company
  • The participation is in an associated company with which the SGPS has signed a subordination agreement (an agreement under which a SGPS subordinates its management to the management of another company).
  • An SGPS may not engage in commercial or industrial activities, including the management of companies not in its group. However, it may provide management and treasury functions to group companies. In addition, an SGPS is subject to the following rules:
  • It may purchase real estate only for its own use and for the use of companies in which it holds more than 10% of the share capital
  • It may not provide credit to non-group companies.

Designation: General Partnerships - "SNC"

Partnerships are rare in Portugal and are primarily used by self-employed professionals.

General partnerships (Sociedades em Nome Colectivo) are characterised by the unlimited liability of all partners. Consequently, the number of members is generally restricted to those who effectively manage the partnership. From an economic standpoint, these partnerships are of limited use and are rarely used in Portugal.

The mixed liability company (Sociedade em Comandita Simples) is practically non-existent in Portugal. The primary characteristic of this type of company is that some of the partners, known as general partners, have unlimited liability, while others, known as limited partners, have limited liability up to the value of their registered capital.

The limited partnership (Sociedade em Comandita por Acções), although legally permissible, is also virtually non-existent. The legal form is identical to that of a mixed liability company, except that shares represent the registered capital of the limited partners.

Professional partnerships are those formed by members of the liberal professions, such as lawyers, doctors, engineers and consultants. Professional partnerships are formed with contributions from each partner rather than share capital. They may be formed by a notary deed that sets out the bylaws of the partnership, including the rules governing the admission of new partners and the method for sharing profits.

Designation: Joint Ventures

Joint ventures may take the following forms:

  1. Consortium (Contrato de consórcio);
  2. Silent partnership (Associação em participação);
  3. European Economic Interest Grouping (Agrupamento Europeu de Interesse Económico, or AEIE)
  4. Association of business enterprises (Agrupamento complementar de empresas, or ACE).

1. Consortium

A consortium is a contractual arrangement favoured by companies coming together for a specific project, usually a large construction project. The formation of the consortium is evidenced by an agreement in writing (if the assets include real estate, the agreement must be executed in the form of a notary deed), which usually contains provisions for the participating parties to contribute the assets necessary to execute the project. In an external consortium, activities and goods are supplied directly to third parties by each of the members, expressly claiming their membership in the consortium. In principle, each member invoices and receives directly the amounts due from third parties, but the agreement may provide a different profit-sharing method. One of the members of the consortium, known as the leader of the consortium, generally manages the business of the consortium and represents the other parties. In an internal consortium, activities and goods are supplied to a member of the consortium, which supplies the third parties, or are supplied directly to third parties by each of the members without expressly claiming their membership in the consortium.

2. Silent Partnership

The association of a person to an economic activity carried on by another, the former participating in the profits or in the profits and losses of the latter may be designated as a silent partnership. The formation of the silent partnership does not require a written agreement, unless an underlying transfer of assets requires such agreement or unless the silent partner does not expect to participate in the losses or to bear unlimited responsibility regarding those losses.

3. European Economic Interest Grouping

An AEIE is an association with unlimited liability consisting of individuals and companies from EU member states.

4. Association of Business Enterprises

An ACE is similar to an AEIE except that its investors are not required to be EU residents. An ACE may engage only in activities that are preparatory or auxiliary with respect to the group’s principal activity. It may not engage in activities that are principally designed to generate profits. With some exceptions, an ACE is treated under commercial law as a company.

Designation: Trusts

The trust concept does not exist under Portuguese law, with the exception of Decree Law No. 352-A/88, of 3 October 1988, which allows the establishment of offshore trust companies in the Madeira Free Zone. Broadly, under such decree, an offshore trust company may be established if the settlers and beneficiaries are not residents of Portugal and if the company derives income only from sources outside the zone and outside Portugal. However, a trust company may invest funds with financial institutions operating in the zone. Trust companies are permitted in the zone if they have a minimum capital of €99,760.

Designation: Branches of Foreign Companies

A non-resident company that intends to carry on an activity in Portugal for more than one year must register a permanent representation (branch) with the Commercial Registry and with the National Registry of Collective Persons (Registo Nacional de Pessoas Colectivas, or RNPC). The formalities for establishing a branch involve the appointment of a local manager with the power to represent the company, the filing of an application for a name and the verification of the parent company’s incorporation documents. The articles of association of the parent company and a copy of the minutes of the board of directors meeting containing the decision to open the branch must be filed with the Commercial Registry. With some exceptions, the branch may carry out any type of activity.

As in other countries, a branch may have more difficulty obtaining local financing than a local subsidiary; however, this may not be considered a major problem.

Mergers and Reorganisations

Approvals for mergers and acquisitions from commercial authorities (the General Directorate of Competition and Prices or supervisory bodies) may be required if the companies involved exceed a certain size or engage in certain activities.

The most common forms of reorganisation are mergers (fusão) and spin-offs (cisão). Full details regarding a proposed merger must be submitted to the shareholders who must approve the merger. In addition, they must be filed at the Commercial Registry and published in the Diário da República. Creditors may take action in the courts to challenge a merger or spin-off within 30 days of publication of the details of the merger in the Diário da República.

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Investment Incentives

Portugal offers a wide range of investment incentives to domestic and foreign investors. The incentives are offered by the central government, the regional governments of the Azores and Madeira and by municipalities.

The Portuguese government and the EU Commission drafted a framework covering financial support for business for the period of 2000 through 2006. (To view the investor’s guide produced by the Portuguese Economy Ministry click here).

Funds provided under the approved framework can be cash grants, interest-free loans or rebates on the interest charged on medium-term loans granted by financial institutions. In the latter case, government agencies pay directly the interest imposed on such loans. The financial institution must be established in Portugal and enter into a memorandum of understanding with the relevant government agency.

In addition to Portuguese legislation granting financial support, EU-funded programs offer incentives to EU investors in particular areas. The municipalities usually provide land at a reasonable price or undertake some of the infrastructure work related to the setting up of project facilities. Some municipalities also offer technical assistance during the initial phase of a project. The recently created Portuguese Investment Agency (Agência Portuguesa para o Investimento, or API) is responsible for all investments exceeding €25,000,000 in all sectors. Investments of less than this amount are also subject to the jurisdiction of the API if the companies and their parent companies generate annual sales exceeding €75,000,000

If the investments do not exceed €25,000,000, but the companies or their parent companies present sales over €75,000,000 they will also fulfil API’s requirements. The API also invests public venture capital in qualifying companies and promotes investment in business parks.

Operational Programmes

Operational Programmes are public incentive regimes, which are designed to support several economic sectors. These regimes are funded by EU Structural Funds, which are funds provided by EU members to assist in the structural development of industry, agriculture, infrastructure and other sectors. The Operational Programmes are summarised below. (For official website click here)


The Operational Programme for the Economy (Programa Operacional da Economia, or POE) supports the modernisation and internationalisation of Portuguese economic activity. POE is administered by the Institute for Support of Small and Medium-Sized Enterprises (Instituto de Apoio às Pequenas e Médias Empresas e ao Investimento, or IAPMEI), the Foreign Trade Institute (Investimentos Comércio e Turismo de Portugal, or ICEP) and the Financial Institute for the Support of Tourism (Instituto de Financiamento e Apoio ao Turismo, or IFT).

Companies may apply for support under the POE program if they are involved in any of the following: mining; manufacturing; energy; certification under ISO Standards 9000 and 14000; tourism; commerce; civil construction; certain services; and transportation.

To qualify for support under the POE program, a company must meet certain conditions, including the following:

  • They must have a debt-to-equity ratio lower than 3:1
  • They must not owe any debts to the tax or social security administrations
  • They must be in compliance with all the legal conditions for performing their activity, including the obtaining of the appropriate licences
  • They must maintain their accounts in accordance with Portuguese General Accepted Accounting Principles (GAAP; also known as Plano Oficial de Contabilidade or POC)
  • They must have the technical and managerial ability to sustain the development of the project.
    The following additional conditions apply to the investment:
  • The minimum investment must be €150,000 for small and medium-sized companies and €600,000 for other companies;
  • The investment must be made over a period not exceeding two years;
  • The investment must consist of at least 30% equity; and

A diagnostic and strategic analysis must support the investment.

The cash grant under the POE program is calculated as a percentage of the eligible professional training costs.

The reimbursable incentive which is a non-interest-bearing loan, is calculated as a percentage of the following eligible costs: land; buildings and equipment; payments for transfers of technology such as patents, exploration licences and know-how; productive investment abroad; costs of acquisition and registration of intangible assets, such as trademarks and patents; market studies and studies related to strategies for internationalisation; promotion and marketing technical assistance; energy savings tests and essays; certification under ISO standards 9000 and 14000; diagnostic and strategic studies; audits; architectural and civil engineering projects; legal certification of accounts; costs related to bank guarantees; and insurance and freight for equipment purchased for the project.

The basic support, which is the cash grant and the reimbursable incentive, equals 30% of the eligible costs. The maximum amount of financial support provided as a reimbursable incentive is €3,750,000.

Additional incentives may be allowed depending on the following: location; whether the company is small or medium-sized; whether the company is owned by young entrepreneurs; and the environmental value-added of the project.

Support for costs related to professional training, R&D activity, and internationalisation can be upgraded up to a maximum of 90%, 80%, or an additional 30% (small company) or 10% (medium-sized company) if certain conditions are satisfied. The maximum amount of financial support for internationalisation equals €1,250,000.

With respect to the eligibility of the project under the contractual regime of foreign investment the financial incentive may not exceed the maximum level of state aid approved by the European Commission under the “map for regional support.”

Effective from 17 December 2002, investments in the Lisbon Tagus Valley region (Lisboa e Vale do Tejo, or LVT) are no longer eligible for the incentives described above.

A new programme named the Business Modernisation Incentive Program (Programa de Incentivos à Modernização Empresarial, or PRIME) is expected to replace the POE by the middle of 2003. However, this new programme is not expected to introduce significant changes.


The AGRO programme supports the following: modernisation, conversion and diversification of farms; processing and commercialisation of agricultural products; development of forests; management of hydro-agriculture infrastructure (irrigation systems); enhancement of the agriculture potential of farms that have suffered natural catastrophes; financial engineering; professional training; technological development and demonstration; information technology infrastructure; and specialised rural services. The Financial Institute for the Support and the Development of Agriculture and Fisheries (Instituto de Financiamento e Apoio ao Desenvolvimento da Agricultura e Pescas or IFADAP) administers the AGRO programme.

Eligible investments of up to €450,000 in projects related to the modernisation, conversion and diversification of farms or the development of forests can qualify for financial support in the form of a cash grant The amount of capital expenditure exceeding €450,000, but not exceeding €750,000, per farm, can qualify for financial support in the form of a reimbursable incentive.

Projects related to the processing and commercialisation of agricultural products can qualify for basic financial support of 30% of the eligible costs. The projects are classified into three categories. Category 1 covers eligible investment costs up to €250,000. Category 2 covers eligible investment costs exceeding €250,000. Category 3 covers projects with capital expenditures exceeding €5,000,000, and therefore, included in the contractual regime (this regime applies to projects in the agricultural sector with a strong structural effect in the agricultural sector) contained in the legislation. For start-up or environment-related projects of Category 1, the cash grant equals 50% of the eligible costs. For projects under Category 2, the basic financial support of 30% can be increased to 50% under specific conditions provided by the regulation. The maximum amount of cash grant available for projects of Category 2 is €1,750,000 and the total financial support is limited to €3,750,000. For projects in Category 3 with eligible investment between €5 million and €12.5 million, the financial support may vary from 30% and 50%, depending on specific conditions set out in the regulations. For projects over €12.5 million, the maximum financial support equals 30% of the eligible costs. For projects exceeding €50 million the amount of financial support also depends on the following:

  • Its contribution to the increase in competition in the sector;
  • The increase in employment resulting from the project;
  • The adoption of modern agricultural techniques and machines; and
  • The impact on regional development.

Projects involving the extraction, processing and commercialisation of cork and its products can qualify for basic financial support of 30% of the eligible costs. These types of projects are classified in two categories. Category 1 covers eligible investment costs up to €250,000, while Category 2 covers eligible investment costs exceeding €250,000, but not exceeding €12,500,000. For projects in Category 2 the percentage can be increased from 30% to 50% under specific conditions set out in the regulation. The maximum support provided to projects under Category 2 is €3,750,000. Up to 80% of this support can be in the form of cash grant not exceeding €1,750,000, with the balance being in the form of reimbursable incentives.

Effective from 29 April 2003, investments in the LVT are not eligible for the incentives described above.


The AGRIS programme supports the diversification of small farms engaged in agricultural and forestry activities and the promotion of alternative sources of income for families in rural areas. IFADAP administers the AGRIS programme.

Under the AGRIS programme, the maximum eligible investment during the period of 2000 through 2006 is €45,000, and the financial support is a cash grant equal to 50% of the eligible investment.


The MARE programme supports the following: definitive withdrawal of vessels from fishing activity through conversion to scrap, transfer to another country or use for a different purpose; establishment of fishing joint ventures; modernisation of fishing vessels; construction of new fishing vessels; development of aquiculture; modernisation of equipment in fishing harbours; processing and commercialisation of fish and aquiculture products; fishing along the coast; socio-economic support of fishermen whose vessel have been permanently withdrawn from fishing activity; research to support a decision to enter into new capital markets; and related capital expenditure; compensation for temporary stoppage of fishing operations; innovative activities and pilot projects regarding fishing; alternative means of financing and applied R&D for fisheries. The Directorate General for Fisheries and Agriculture (Direcção Geral das Pescas e Agricultura, or DGPA) administers the MARE programme.

Financial support for definitive withdrawals from activity of fishing vessels is available through a cash grant equal to 60% of the amounts fixed in the regulation (Portaria No. 56-C/2001), which vary according to the type of vessel.

Financial support for projects related to the processing and commercialisation of fish products and the development of aquiculture is provided for three categories of investment projects. Category 1 includes eligible investments up to €600,000. These investments qualify for cash grants equal to 40% of amount of the investment. Category 2 consists of eligible investment projects exceeding €600,000, but not exceeding €2,500,000. These investments qualify for support equal to 40% of the investment. Up to 80% of this support may be in the form of a cash grant, while the balance is in the form of a reimbursable incentive. Small and medium-sized enterprises receive an additional 10% as a reimbursable incentive. Category 3 consists of investment projects with eligible investment exceeding €2.5 million. These projects receive financial support equal to 40% of the costs. The support is divided equally into a cash grant and a reimbursable incentive. The maximum amount of cash grant is €1.5 million, and the total amount of financial support is limited to €3 million.

Financial support for projects involving the construction of new fishing vessels is granted in the form of a cash grant and reimbursable incentive. The cash grant equals 40% of the eligible cost, and the reimbursable incentive carries a 2-year grace period, and a 3-year repayment period.

Financial support for investment projects related to the establishment of fishing joint ventures is granted as a cash grant equal to 60% of the amounts fixed in the regulation, which varies depending on the type of vessel. Under certain circumstances specified in the regulation, the percentage can be increased to 80%.

Customs-Free Zones

Currently, the only existing free zone is located in Caniçal in the Autonomous Region of Madeira.

Another free zone is foreseen for the Azores in Santa Maria. However, the regional government in the Azores must enact certain regulatory measures before the zone is established. Under Regulatory Decree No 53/82 of 23 August 1982, the following are significant aspects of the free zones:

  • Goods in free zones are considered not to be in customs territory of the EU for the purpose of the application of customs duties, quantitative restrictions and similar measures.
  • No restrictions are imposed on the entry of any type of goods into free zones regardless of quantity or country of origin or destination. Presentation of the bill of lading or other documentation is not required. It is only necessary to deposit a manifest of the goods with the customs authorities.
  • Goods manufactured in Portugal or fully duty paid on importation into Portugal may enter the free zones if appropriate documents are submitted.
  • The export of foreign goods by ship or air to a foreign destination may be made without customs formalities. The only requirement is that goods must be escorted by a customs official to the actual point of expedition.
  • Transfers of goods from the free zones to Portugal are subject to duties and other taxes on the foreign component of the final product if the free zone has been used only as a staging post or bonded warehouse.

Madeira Free Zone

The free zone in Madeira is known as the Madeira Free Zone (Zona Franca da Madeira, or ZFM). All industrial, commercial and financial activities may be authorised in the ZFM. Applications are examined and approved by the Madeira regional government or by an entity designated by it. The Madeira Development Company (Sociedade de Desenvolvimento da Madeira, or SDM) is the official contact for the ZFM.

In addition to various tax incentives companies established in the ZFM generally benefit from the following:

  • Exemption from quotas (limitations on the import or export of goods) and customs duties on the export to EU and non-EU countries of goods produced in the ZFM that incorporate raw materials originating in the EU;
  • Exemption from quotas and customs duties on the export to non-EU countries of goods produced in the ZFM that incorporate raw materials not originating in the EU;
  • For the export of goods produced in the free zone that incorporate raw materials not originating in the EU, customs duties apply only to the amount of raw material imported from non-EU countries, and not on the value added in the ZFM; and
  • Temporary VAT exemption for the import of raw materials.
    Under EC Council Decision No. 122/96 of 22 January 1996 and EC Commission Regulation No. 122/96 of 28 July 1997, the customs duties applicable to certain goods released for free circulation in the ZFM that include raw materials and other components imported from non-EU countries may be reduced by up to 100% if the following conditions are satisfied:
  • The goods have undergone a substantial transformation in the ZFM according to the EU rules of origin contained in EC Council Regulation No. 2913/92 and will be processed at least to the extent required by Article 24 of that regulation and by Articles 35 to 46 of EC Commission Regulation No. 2454/93; and
  • The processing is wholly carried out in the in the ZFM.

The favourable treatment described in the preceding paragraph is granted only to persons established in the EU and applies until 31 December 2005.

Under EC Council Regulations No. 1657/93, of 24 June 1993, as amended by EC Council Regulations No. 3256/94, of 22 December 1994, and No. 2789/00, of 14 December 2000, customs duties are suspended until 31 December 2008 for imports from non-EU countries of certain industrial products and equipment required for operations in the ZFM.

Under EC Council Regulation No. 1600/92, of 15 June 1992, and EC Commission Regulation No. 1600/92, of 30 June 1992, certain agricultural products imported into the Azores and Madeira from non-EU countries are exempt from customs duties.

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Special Investment Considerations

Regulated Industries

The government has relaxed the regulation of business in line with Portugal’s efforts to adapt to EU rules and regulations. It has introduced new laws regarding price controls, competition, environmental protection, banking, insurance and securities’ markets.

Price Controls

Portugal has abolished most controls on prices. The government has also cut price subsidies, allowing prices to reflect costs more directly. Price controls remain in effect in certain sectors, including energy and transportation, in which the government determines that price regulation is necessary. The government consults with manufacturers to set pharmaceutical prices.

Environmental Law

Law No. 11/87, of 7 April 1987 regulates the protection of the environment. Although certain companies have been required to build new units to treat effluents and waste, the law primarily affects new investments. All companies planning major development projects must carry out an environmental-impact study before operations begin. The study, which must be approved by the Secretary for the Environment, must include the following:

  • An analysis of the location and the environment in which the project would be implemented;
  • A study of environmental impact that would be caused by the project; and
  • The measures proposed to avoid any damage to the quality of the environment.
    The authorities are funding anti-pollution efforts through the POE incentive program by providing a wide range of subsidies and grants to domestic and foreign companies that are required to invest in environment-related improvements.

The government may suspend or reduce the level of activity of a plant if it exceeds the legal pollution levels, and may order a heavily polluting plant to change location. Under general legal principles, a new investor in an existing enterprise may be held liable for environmental damage caused by the enterprise in the past.

The Director-General for the Environment (Direcção-Geral do Ambiente) enforces legislation concerning toxic and radioactive waste, noise and chemical substances. The National Water Institute (Instituto Nacional da Água) is responsible for the control of industrial effluents.

Government-Owned Industries and Privatisation

In 1996 and 1997, privatisations of diverse types of companies generated revenues of approximately €6,484.

Most of the privatisations to date have been achieved through public offerings of shares quoted on the stock exchange. Future privatisations are expected to include transportation (the national airline), paper pulp and energy (the national oil and gas company).

To encourage public interest in privatisation issues, only 50% of dividends from companies privatised in 2002 or an earlier year are subject to corporate income tax or personal income tax (the exemption applies until the fifth year following the conclusion of the privatisation process for the company).

Restrictions on Foreign Investment

The Foreign Investment Code (Decree Law No. 321/95, of 28 November 1995) governs foreign investment in Portugal. In accordance with EU rules, the Foreign Investment Code allows non-residents to set up enterprises to engage in any economic activity open to the private sector. It also assures non discrimination among Portuguese and foreign investors.

The Portuguese Foreign Trade Institute (Investimentos e Comércio e Turismo de Portugal) is responsible for all matters relating to foreign direct investment in Portugal and to Portuguese investment abroad.

Investors requesting state aid for an investment project may apply under either of the following regimes:

  • General regime of incentives; or
  • Special contractual regime of foreign investment.

Registration of Foreign Investment

Under Article 8 of the Foreign Investment Code, all investments by non-resident entities and individuals in existing or new Portuguese enterprises must be registered with the ICEP for administrative and statistical purposes, within 30 days after the date of the investment.

Under the Bank of Portugal’s Notice No. 5/93, of 1 October 1993, the following foreign-investment operations must be reported to it within 10 business days after the date of the contract or transaction:

  • The opening of foreign accounts by Portuguese residents
  • Credits or loans granted or obtained by residents for a term longer than one year in an amount equal to or exceeding €250,000, as well as credit assignments or debt acceptances regarding such credits or loans
  • Portuguese direct investment abroad or foreign direct investment in Portugal equal to or exceeding €250,000
  • Investment in real estate abroad by residents
  • Investment in Portugal by non-residents
  • Investment in securities abroad by residents
  • Opening of current accounts between residents and non-residents that are designed to use netting as a method for settling the parties’ obligations.

Contractual Regime of Foreign Investment

Under Article 6 of the Foreign Investment Code, investment projects that involve a specified amount of capital expenditure can apply for the contractual regime of foreign investment. Investment projects qualifying for such a regime may obtain special financial and tax incentives.

Regulatory Decree No. 2/96, of 16 May 1996, amended by Regulatory Decree No. 4/00, of 24 March 2000 establishes the procedures for the filing of such application. Under Portaria No. 865-A/2002, the capital expenditures associated with the eligible investment must exceed €25 million. Projects that qualify for the regime are eligible for financial incentives as well as tax incentives.

After approval is granted by ICEP, the applicant must file a formal application for the incentives in accordance with a specified time schedule. For applications covering both financial and tax incentives, the package of incentives is approved in a government cabinet meeting.

Projects under the contractual regime may qualify for financial support under the Operational Programs and tax incentives. Article 49-A of the Tax Incentives Statute and Decree Law No. 409/99, of 15 October 1999 provide tax incentives available to investment projects carried out in Portugal through 31 December 2010.

Acquisition of Real Estate

Purchases by non-residents of real estate that will not be used in a business activity need not be reported to ICEP.

Foreign-Exchange Controls

Portugal does not impose foreign-exchange controls. No restrictions are imposed on inbound or outbound investments.

Antitrust Rules

Unless a specific exception applies, the rules on competition set out in Decree Law 371/93 of 29 October 1993 apply to all economic activities. The legislation generally conforms to the relevant Articles 81 and 82 of the European Community (EC) Treaty.

In accordance with the principles of EU competition law, Decree Law No. 371/93 prohibits an agreement between companies if the purpose or result of such agreement is the prevention, distortion or restriction of competition in the domestic market for goods or services.

Decree Law No. 371/93 also prohibits abuses by one or more companies with a dominant position in the domestic market if the purpose or result of such abuses is the prevention or restriction of competition. However, if the results from such dominant position are deemed beneficial, companies may be granted an exemption under Article 81 of the EC Treaty.

Decree-Law No. 371/93 also inhibits the imposition of minimum prices, the application of discriminatory prices or sales conditions to equivalent services or goods, and refusals to sell.

The General Directorate of Competition and Prices (Direcção Geral da Concorrência e Preços, or DGCP) and a five-member Competition Council jointly administer Portugal’s antitrust law. A company may apply to the Competition Council for a certificate of legality for its competitive practices or for a declaration of inapplicability of Decree Law 371/93.

Decree Law No. 371/93 requires companies to notify the DGCP if a contemplated merger will result in the creation of either of the following conditions:

    • Combined turnover exceeding €150 million, net of taxes, based on the previous year’s sales; or
    • A market share in Portugal of at least 30%.

    A merger may proceed only after it receives the authorisation from the DGCP. Mergers involving insurance companies, credit institutions and finance companies require the approval of the Portuguese Institute of Insurance (Instituto de Seguros de Portugal) and the Bank of Portugal

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    Regional and International Trade Agreements and Associations

    Portugal is a full member of the EU, and the World Trade Organisation (WTO). Portugal is also a member of the Organisation for Economic Cooperation and Development (OECD), the International Monetary Fund (IMF) and the North Atlantic Treaty Organisation (NATO).

    Major Trading Partners and Leading Imports and Exports

    Foreign trade has contributed significantly to the growth of the Portuguese economy, with exports and imports representing in 2001, approximately 32% and 41% of GDP, respectively.

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    Major Trading Partners

    Portugal primarily trades with the other EU countries. Currently, the destination for 79.7% of Portuguese exports are other EU countries, with 5.8% going to the United States, 2.8% to Portuguese-speaking countries and 1.9% to European Free Trade Association (EFTA) countries.

    In 2001, Portugal’s primary sources of imports were Spain (27%), Germany (14%), France (10%) and Italy (7%). Portugal’s primary export destinations were Germany (19%), Spain (19%), France (13%) and United Kingdom (10%).

    In 2001, North America accounted for 6.3% of Portugal’s exports and 4% of its imports. The United States was the fifth largest destination for Portugal’s exports, accounting for 5.8% of the total.

    Leading Imports and Exports

    In 2001, Portugal’s exports of manufactured goods represented 98% of total exports. Exported manufactured goods included machinery and electrical material, clothing textiles, vehicles and transport equipment, footwear, paper and pulp products and chemicals.

    In 2000 and 2001, exports of goods and services increased by 10% and 1%, respectively, while imports increased in by 10.1% in 2000 and decreased by 2% in 2001.

    In 2001, textiles and clothing accounted for 18.7 % of the total of exported manufactured goods, with machinery and electrical and optical goods accounting for 14.2 % (this category of goods includes moulds for the plastic industry, machine tools and engines, chips, microchips and television sets), automobile and other transport equipment accounting for 18.1%, and wood, cork, paper and pulp products accounting for 9.6%.

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    Importing and Exporting


    In general, goods may be freely imported into and exported from Portugal. Portugal applies EU and other international restrictions to certain goods. For purposes of supervision and inspection and public health and safety, certain import restrictions are imposed, particularly on goods from non-EU countries.

    Customs Duties

    As a result of Portugal’s membership of the EU, Portuguese imports are subject to the EU common external tariff. In general, import duties are not levied on goods imported from other EU member states if the goods are in free circulation. Goods are considered to be acquired from another EU member state if they originated from within the EU or, for goods originating outside the EU, if all duties applicable on the importation of the goods into the EU have been paid. The EU also provides preferential tariff arrangements to a large number of countries. As a result of these arrangements, many goods benefit from a reduced or zero rate of duty. These arrangements relate to the origin of the goods and vary widely among countries. Complex rules govern eligibility for preference arrangements. Before importation, importers must ensure that these rules are satisfied and that the necessary documentary evidence is obtained from the supplying country.

    If duty is due, accurate product classification is essential to ensure that the correct amount is paid. Certain goods may be subject to a quantitative tariff, allowing duty-free entry only up to a certain limit. Special types of relief from customs duties are granted in certain circumstances. These special types of relief are described below.

    Inward Processing Relief

    Under the system of inward processing relief (IPR), goods imported from outside the EU for processing and subsequent re-export may be relieved from customs duties and from certain other charges. IPR may be general or specific.

    Outward Processing Relief

    Subject to certain conditions, outward-processing relief (OPR) allows goods to be exported from the customs territory of the EU for processing and re-imported partially or wholly free of import duty.

    Although the relief is intended to cover goods temporarily exported for the purpose of completing a specific process, it may also be granted if exported goods return to the EU and if either of the following conditions apply:

    • The goods are in the same condition as when they were exported; or
    • The goods are intermediate products of a process that has only been partially completed.


    Portugal follows the valuation system of the World Trade Organisation (WTO) for determining the customs value for import duty and import value-added tax (VAT) purposes. Under this system, six specified methods of valuation must be applied in hierarchical order. The first, or primary, method of valuation is based on the price actually paid or payable for the goods, that is, the transaction value. However, other methods of valuation may be applied according to WTO specifications.

    Anti-dumping Regulations

    Anti-dumping duty is imposed on specific goods originating from, or exported by, designated countries or exporters. It is levied to protect EU trade and applies to goods that are imported into the EU at prices less than the “normal value,” which is usually the value of the same or substantially similar products in the exporting country. Anti-dumping duty is levied to increase the price of the imported goods up to an acceptable amount; consequently, it may be imposed at high rates. Anti-dumping duty is payable in addition to other import duties and taxes.

    Anti-dumping duties may also be levied on products that are assembled or produced in the EU if all the following conditions apply:

    • A party related to or associated with a manufacturer or exporter of products that is subject to anti-dumping duty assembles the product
    • The EU operation was started, or substantially expanded, after the initiation of an investigation into the dumping of the goods
    • The value of the parts used in the product that originated in a country to which anti-dumping duty applies exceeds the value of the other parts by 50% or more.

    Source: Doing Business in Portugal – 2003 by Ernst & Young – 26 June 2003
    Last updated in July 2003 by the British-Portuguese Chamber of Commerce

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Tax & Legal Info In Portugal

Legal Information

Labour Law

The law now allows, as a general rule, the performance of temporary labour contracts in order to satisfy any transitory needs of the company and only for the required period of time to comply with those needs. The Code completes this general rule with an exemplificative catalogue of situations that can justify the employment of staff under a temporary labour contract.

Therefore, a transitory need of the company can be considered, namely:

  • The direct or indirect replacement of an employee who is not able to render his services for some reason or in relation to whom there is a pending legal action concerning dismissal, as well as the replacement of an employee who is merely absent or benefiting from a non-remunerated license, or, moreover, of an employee who went from working full-time to half time;
  • Seasonal activities or other activities with irregular cycles of production;
  • Unusual increase of activity;
  • The performance of occasional tasks or of determined, precise and non-lasting services;
  • The performance of works, projects or other precise and temporary activities.

The Code now foresees other situations, which allows temporary employment, not necessarily related to transitory needs of the company, such as:

  • The beginning of a new activity with an uncertain duration, or the start up of a company or establishment;
  • Employment of workers looking for a first job or long time unemployed, and other situations of special employment policies.

It is employer’s responsibility to provide evidence for the facts that justify the temporary employment.

Labour contracts limited to a fixed period of time have to be written and signed by both parties and have to contain certain elements. It is necessary to indicate the motive for the temporary employment by describing the facts that integrate such motive, and it is also necessary to establish a relation between the motive and the period of duration of the contract.

Other elements such as the signature of both parties, their identification, as well as the dates of appointment and of termination, must be included in

the contract, otherwise it can be considered as a permanent contract and the employer will not be able to terminate it unilaterally.

Consecutive contracts

Termination, by the employer, of a temporary labour contract prevents a new admission of an employee, on a temporary basis, for the same job during a certain period of time. This period of time is now of one third of the duration of the contract (including renewals).

The Labour Code provides for certain exceptions to this rule:

  • New absence of a replaced employee when the temporary contract had the purpose of replacing such employee;
  • Unusual increase of activity after the termination of the temporary contract;
  • Seasonal activities;
  • When the employee was appointed, in the first place, when looking for a first job.

Should the consecutive contract be signed with the same employee without respect for the legal period of time above mentioned, the contract will be considered permanent and seniority will be calculated from the date when the employee was first admitted.

Should the employer wish to admit an employee to execute the same functions, under a contract without term, the employee, admitted previously on a temporary basis will have preference in the admission for such employment during 30 days after the termination of his contract, otherwise the employer may have to pay him compensation.

Time Limits

The new Labour Code continues to provide for a maximum duration of 3 years for temporary contracts, including renewals. However, now the Code admits the possibility to, at the end of those 3 years, (or after the maximum number of two renewals), to renew the contract for one more period of time which cannot be less than one year and greater than 3 years. Therefore the maximum time limit for temporary contracts is now 6 years with the limit of three renewals.

The duration of temporary labour contracts is more limited in cases where the motive for the term is the introduction of an activity of uncertain duration, the start-up of a company and long-term unemployment. In such cases the duration of the contract cannot exceed two years. Also in cases of employees looking for a first job the duration of the contract cannot exceed 18 months.

Labour contracts with a fixed term are subject to automatic renewal, at the end of the term, for an equal period of time. In case the limits of duration are exceeded, or the number of renewals, the contract will be considered permanent.

The near impossibility to execute temporary labour contracts for less than 6 months continues, i.e., only in cases of replacement of employee, increase of activity, seasonal activities and execution of occasional tasks is it possible to enter into this type of contracts.

Temporary labour contracts with an uncertain term are those contracts with no fixed period but subject to the completion of an activity.

Therefore, temporary labour contracts can only have an uncertain duration in the following situations: replacement of employee, seasonal activities and execution of occasional tasks or non-lasting services, unusual increase of activity and execution of works, projects or other defined and temporary activities.

A temporary contract with an uncertain duration has no limit of time, lasting for all the time of the maintenance of its motive. Therefore, the contract will only be considered permanent should the employee remain employed after the period of prior notice, if that is the case, or after 15 days from the conclusion of the activity for which he was appointed to (or from the return of the replaced employee).


Under the general provisions of the Labour Code concerning this matter, employees have a statutory right to a minimum of 22 days annual paid holiday. This right is acquired by the employee immediately upon the signature of the contract. However the right to take the annual leave is only effective as from the 1st of January of each civil year. During the employees’ first year of employment they have the right to 2 days of paid holiday for each month of employment (which an employee can only take after 6 months of consecutive work), up to a maximum of 20 days. If this leave cannot be taken by the employee up to the end of the first year it can be taken in the following year, however, the accumulation cannot lead to a period of holidays larger than 30 days on such following year.

Finally, a very important innovation in this new Labour Code concerning holidays is the possibility to increase the normal period of 22 days of paid holiday up to 25 days in case the employee has no absences from work or has only up to 3 justified absences.

Termination of temporary contracts

Temporary labour contracts terminate at the end of the agreed period by means of simple written notification from the employer with 15 days minimum notice to the date of termination (or 8 days in case of termination by the employee). Temporary agreements aimed at certain transitory jobs, with no fixed period but subject to the completion of the activity, require a prior notice by the employer 7, 30, or 60 days whether the agreement had a duration of respectively, 6 months, from 6 months to 2 years, or for a longer period.

The expiration of the contract resulting from the notification of the employer will entitle the employee to compensation corresponding to 3 or 2 days of remuneration for each month of duration of the contract, depending if the contract lasted for up to 6 months or more.


An employee appointed temporarily who wishes to terminate his contract before the end of the term can revoke the same by notifying the employer with a prior notice of 30 or of 15 days should the agreement have a duration of, respectively, 6 months or more, or less than 6 months.

By Marta Leitão of Abreu & Marques, Vinhas e Assoc .

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