Doing business

Portugal

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Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information

Setting up a company

Types of companies and capital (max/min)	Number of partners/shareholders and liability
The "sociedade por quotas de responsabilidade limitada (Lda)" is a limited liability company. 5,000 EUR minimum, entirely taken up, with the obligation to release at least 50%.	2 partners minimum, just one in the case of an individual businessman. Liability is limited to the amount of capital contributed.
The "sociedade anonima de responsabilidade limidada (SA)" is a public limited company. 50,000 EUR minimum, entirely taken up, with the obligation to release at least 30%.	5 partners minimum; they may be foreigners and non-residents. Liability is limited to the amount of capital contributed.
The "sociedade em nome colectivo" is a general partnership. No minimum capital.	2 partners minimum Liability is joint and indefinite regarding third parties.
The "sociedade em comandita" is a limited joint-stock partnership. No minimum capital.	2 partners minimum, with active partners and silent partners. Liability is indefinite for active partners, and limited to the amount of capital contributed for silent partners.

Business setup procedures

Setting up a company	Portugal	OECD
Procedures (number)	6.0	5.6
Time (days)	6.0	13.8

Source: Doing Business.

For further information: Consult Doing Business Website, to know about procedures to start a Business in Portugal.
Trade Register, in Portuguese.
The competent organization: Business Formalities Centres (CFE)

FDI in figures

Foreign Direct Investment	2008	2009	2010
FDI inward flow (millions USD)	4,665	2,706	1,452
FDI stock (millions USD)	99,969.7	114,709.7	110,241.3
Performance Index*, ranking on 141 economies	106	106	-
Potential Index**, ranking on 141 economies	51	-	-
Number of Greenfield investments***	80	55	-
FDI inwards (in % of GFCF****)	8.8	35.1	-
FDI stock (in % of GDP)	41.0	48.9	-

Source:

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest Portugal

Strong points: Portugal's strong points are:
- The low labor costs;
- Its geographical situation. Portugal act as a bridge between 3 continents: Europe, Africa, America;
- its temperate climate;
- its socio-political stability and the non-existence of terrorism; and
- the stability of its currency.
You can consult the Ministry of the Economy website.
Weak points: Portugal's weak points are its weak demography and a certain rigidity in the labor law.
Government measures to motivate or restrict FDI: Government policies have followed the priority established by the Prime Minister, to promote the country's appeal to foreign investors. In order to do this, simple taxation procedures have been put in place, effective warehousing and transport logistics have been set up (especially the Sines terminal in the South-West of the country), as well as improvements in telecommunication infrastructures, etc. An agency for investment and foreign trade has been established: the AICEP.
Other measures have been implemented, including making the labor law more lenient in order to increase the workforce flexibility, and setting up a special aid regime for large projects (over 25 million EUR).
Bilateral investment conventions signed by Portugal: Portugal has signed bilateral agreements with almost fifty countries (not including the EU).
To see the list of countries, click here.
To see the conventions, click here.

Procedures relative to foreign investment

Freedom of establishment: Yes
Acquisition of holdings: Portuguese law allows a taking up of the capital or the acquisition of a Portuguese company up to 10% or more.
Obligation to declare: Foreign investors may carry out all types of activities in the same conditions as a local investor. Foreign investment in Portugal is, on principle, free of all administrative control. The only formality that the foreign investor must comply with is registration, for statistical reasons, within 30 days of the investment.
Finally, investment projects "presenting a particular interest for the Portuguese economy" (projects over 4.9 million euros, especially those creating jobs, allowing industrial reconversion, ensuring the development of a priority region, or introducing new technologies) are subject to a particular procedure managed by the Institute for Investment, Trade and Tourism in a restructured Portugal "AICEP".
The agency for the promotion of foreign investment in the country can provide information about the authorizations necessary for setting up.
Competent organization for the declaration: AICEP
Requests for specific authorizations: There are no restrictions on foreign investment in Portugal, but only an analysis of the legality of the project (applicable also to any project of national capital).
Consult the Guide for investors.

Finding assistance for further information

Investment aid agency: AICEP
Institute for support for SMEs and investment (IAPMEI)
Other useful resources: Portuguese Tourist Institute