AutorFranco Caiado Guerreiro & Associados
Cargo do AutorSociedade de advogados

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2.1. Types of corporation

Corporations in Portugal generally assume one of the two most common forms:

1) Public limited corporation or joint-stock corporation ("SA" or "Sociedade Anónima")

2) Private limited corporation - ("Limitada" or "Lda" or "Sociedade por Quotas")

These forms basically correspond to the German figures of the AG (Aktiengesellschaft) and the GmbH (Gesellschaft mit beschrankter Haftung).

The "SA" designation and form provide the positive image of a large corporation (there are, however, significant additional administrative and legal burdens for such a corporate format) and gives prestige and contractual strength to the investment made. Also, it provides the capitalization of funds for projects requiring financial backing, together with the possibility of easy integration of new partners in the structure, since stocks are bearer instruments (unlike for private limited corporations).

Private limited corporations are generally of a smaller dimension when compared to public limited corporations. Their legal structure favors the personalization of the business, providing a personal nature or group nature to it.

In a private limited corporation, the capital is divided into quotas representing each individual or corporate partner's share of the total capital stock. On a subsequent capital increase, each partner subscribes to a new quota or increases their initial quota. Creditors can claim only against the corporation's capital stock. But partners can be held responsible for the corporation's debts if their direct responsibility is stipulated in the corporate statutes.

In a public limited corporation, the capital is divided into stocks and each stockholder's liability is limited to the value of stocks held and subscribed.

In private limited corporations, payment of subscriptions may be deferred for up to 50% of the nominal capital. But the total nominal value of subscriptions paid up in cash and assets must correspond to the minimum capital for a private limited corporation as defined by law (Euros 5,000). Page 12

In public limited corporations, payment of subscriptions may be deferred up to 70% of the nominal capital. But the total nominal value of subscriptions in cash and assets must correspond to the minimum capital for a public limited corporation as defined by law (Euros 50,000).

Foreign corporations, just like Portuguese corporations, may invest in any sectors they wish to. Nevertheless, specific restrictions, like the need for a concession contract for private investors who want to operate in sectors under public administration, may appear.

Although in Portugal there is no legal restriction to the entry of foreign capital and foreign investors are not required to have a Portuguese partner, foreign investment projects have to comply with special legal requirements if they could in any way affect public order, security or public health. Projects of this nature require an assessment of their compliance with the legal conditions and pre-requisites set out in Portuguese Law.1 Page 13

2.2. Proceedings on incorporation
1. Define the corporation's principal activity & corporate name

Stockholders wishing to incorporate a corporation in Portugal must apply for a corporate name certificate at the National Registry for Collective Entities.

The corporate name application requires:

1) Proposed corporate name and two other alternative corporate names (in case the first choice is not available);

2) The corporate name, which:

  1. Must reflect the activities that the corporation intends to perform;

  2. Cannot be misleading regarding the activities it proposes to undertake;

  3. Cannot be confused with another corporate name already registered with the Registry.

All registered names benefit from the exclusivity principle in Portuguese territory.

After the approval of the corporate name, the Registry will issue a certificate of registration together with a provisional tax registration card, which indicates the corporation's tax number, also referred to as the Collective Person Identification Number.

2. Commercial Corporation Registrar


1) Commercial Registry,

2) Publication in the Portuguese Official Journal "Diário da República";

3) Register at the RNPC - National Registry for Collective Entities. Page 14

3. Declare the Start of Activity date

Once the incorporation deed has been carried out, register the activity of the corporation at the local Tax Authorities, signed by the official accountant responsible for the corporation accounts. Declare the start date of the corporation's activity by internet or at the Government Tax Office.

4. Social Security

The new corporation must also register with the regional Social Security office.


1) Social Security Forms;

2) Collective Entities Provisory Registry;

3) Corporation deed;

4) Start of activity signed declaration;

5) Photocopies of the respective signing entities' identity papers.

5. Register the corporation

At the Department for Trade & Competition or at the corresponding Regional Directorate of the Ministry of Economy.


2.3. The "Instant Company Service"

The 2 "Instant Company Service" service is available in any Commercial Register Office.

The main difference of this special procedure for incorporating a company in one day is that the corporate name and the articles of incorporation are off-the-shelf.

Nevertheless, immediately after incorporation, the name and articles of incorporation can easily be changed or amended.

This permits a company to be fully operational within 24 hours.

2.4. Venture Capital Markets and the Lisbon Stock Market
Venture Capital Markets

A venture capital market is already well established in Portugal and may be a good vehicle for financing corporations which are operating in emerging sectors, are at a high risk stage of their development or do not have direct access to capital markets.

The recent setting up of venture capital syndication funds will encourage...

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