Corporate
CORPORATE
We provide advice on Portuguese corporate law matters and we handle all business incorporation and registration matters on behalf of Clients.
Our deal execution work includes:
- Company incorporation and branch registration
- Drafting and negotiation of articles of incorporation, shareholders' agreements, commercial contracts, employment contracts, etc.
- Registration of statutory changes
- Business licence applications
We may also introduce you to the non-legal professionals (accountants, business management consultants, bankers, etc.) that may be needed by your business.
About Portugal's Business Entity Formats
The most common Portuguese business entity formats are:
- The Sociedade por Quotas (Lda), a private limited liability company having the share capital divided into “quotas” of at least 1 euro each, the ownership of which must be registered with the Commercial Registry Office. The name of this type of company must end with the word Limitada or the abbreviation Lda, and for this reason it is also often known as an "Lda", In case there is a sole quota holder, the name extension must be Unipessoal Lda.
- The Sociedade Anónima (SA), a public limited company with a minimum capital of EUR 50,000 (at least 30% of which must be paid up on incorporation), represented by freely transferable shares, which may be issued to the bearer. Except where the founder is a company, there must be an initial number of shareholders of not less than 5. Irrespective of size, this company's accounts must be audited annually by a certified auditor (Revisor Oficial de Contas).
- The Sucursal (branch) of a non resident business entity, a permanent establishment that carries on a business activity in Portugal, which is a local extension of the represented business entity, with no separate legal personality, the management of which being performed under delegation of powers by the owning entity. The branch is in practice treated as a domestic company as regards taxation and compliance; but there is no requirement to file the “parent’s” accounts in Portugal. However, unlike a domestic company, the distribution of profits by the branch to the “parent” is not taxed.
- The Partnership, which may take on the format of a general partnership with unlimited liability of all members (Sociedade em Nome Colectivo), and is tax-transparent; or of a partly limited partnership, either having no share capital (Sociedade em Comandita) or having a share capital (Sociedade em Comandita por Acções), which must have at least one unlimited partner (the general partner, called sócio comanditado, who contributes goods or services and takes on the management) and one or more limited partners (sócios comanditários), who contribute capital and have no management responsibilities. Certain professions, such as lawyers and certified auditors, may adopt profession-specific, tax-transparent, forms of partnership. Finally, the Associação em Participação, a non-incorporated general partnership formed by private deed and having a general partner plus one or more limited partners, whose profit share is fiscally treated as a dividend. Under this format, the general partner (Associante) takes on the partnership management and has unlimited liability, and the limited partners (Associados) contribute capital and may or may not assume responsibility for losses, in accordance with the formation deed.
About the Shareholders and Directors
No restrictions apply to the nationality or place of residence of the shareholders and directors of a Portuguese business entity, but the following should be noted:
- The individual ultimate beneficial owners of a business entity must be identified and are subject to registration;
- A corporate shareholder or director must at all times have a designated individual representative, whose identity is subject to registration;
- Directors are jointly liable with the company for debts to the Portuguese State.