Law 10/2009, of March 10, amended the national budget for 2009 and created the budget program “Initiative for Investment and Employment” (Iniciativa para o Investimento e o Emprego), which approved the Tax Framework for Investment Support in 2009 (Regime Fiscal de Apoio ao Investimento realizado em 2009, the “RFAI 2009”).

The program has five main purposes: (i) modernisation of schools, (ii) promotion of renewable energy sources, energetic efficiency and energy transport networks, (iii) modernisation of the technological infrastructure, (iv) special support to the economic activity, exports and small and medium sized companies and (v) support to employment and social protection.

The RFAI 2009 applies to taxable persons who are active (i) in the agriculture, forest, agro-industrial, power and tourism sectors and in the extraction or manufacturing industries, except for the steel, shipbuilding and synthetic fibers sectors and (ii) in the new generation broadband networks.

The RFAI 2009 sets out a combined system of tax incentives in order to stimulate the productive investment, including the following measures:

(a) Deduction to the corporate income tax payable (up to 25%) of (i) 20% of the relevant investment, for investments up to €5,000,000 and (ii) 10% of the relevant investment, for investments up to €5,000,000;

(b) Exemption from real estate municipal tax (Imposto Municipal sobre Imóveis) for a period up to five years for buildings owned which are deemed relevant investment; and

(c) Exemption from the municipal real estate transfer tax (Imposto Municipal sobre Transmissões Onerosas de Bens Imóveis) and stamp duty (Imposto de Selo) for real estate acquisitions which are deemed relevant investments.

In addition, Law 10/2009 approved the reduction of the minimum limit for advance tax payments (pagamento especial por conta) for the account of IRC, from €1,250 to €1,000, and reduced the minimum limit of tax credit above which the reimbursement of VAT may be requested to €3,000.

The Statute of Tax Benefits was also amended. In this regard, it is important to mention (i) the extension of the SGPS special tax regime to companies whose corporate purpose is to manage shares incorporated in other Member States and (ii) the increase of tax benefits for the acquisition of computers for personal use and equipment related to new generation broadband network.

Finally, several changes were introduced in the System of Tax Incentives for Corporate Research and Development (Sistema de Incentivos Fiscais em Investigação e Desenvolvimento Empresarial, the “SIFIDE”), including the increase of the percentage of deductible costs with R&D that are deductible to 32.5%, as well as the increase of the maximum limit of the incremental rate from €750,000 to €1,500,000.

© 2009 Macedo Vitorino & Associados


Macedo Vitorino e Associados will participate in the 2nd Iberian Forum on Natural Gas, organized by IIR - Institute for International Research, that will take place on the 18th November, in Lisbon.
João Macedo Vitorino will be ther chairman of the event.

For more information



1. The nationalisation of BPN
The Portuguese Cabinet of Ministers decided yesterday to propose to the Parliament the nationalization of Banco Português de Negócios S.A. (BPN), which had been facing difficulties since its previous board of directors discovered losses of an estimated amount of €700 million that had been ommitted in previous reports to the Bank of Portugal (BoP).

According to the Bank of Portugal, most of the unaccounted losses of BPN resulted from transactions with off-shore companies and from an undisclosed relationship with Banco Peninsular, a bank located in Cape Vert, controlled by the BPN group.

Despite the efforts of the BPN’s board appointed in July 2008 in restructuring the bank, the risks of an insolvency increased after the refusal of its shareholders to subscribe the second tranche of the share capital increase scheduled for the October 31, as well as the financial crisis which prevented BPN from selling assets to cover its losses.

The Minister of Finance justified the Government’s decision with the need to ensure the safety of BPN’s depositers and to prevent any adverse effects that a failure by the bank in meeting its obligations could have in the credibility of the Portuguese banking system.

The Minister of Finance also decided to put BPN under the control of Caixa Geral de Depósitos (the State-owned bank), and appointed two of its directors to the Board of BPN to overview the management of the bank until the nationalization is completed.

Following the nationalization, the Government could either decide to merge BPN’s operations into Caixa Geral de Depósitos and dispose of certain assets or sell of BPN as a whole to another domestic or foreign bank.

2. The re-capitalisation of Portuguese banks
The Government also announced that it would issue new legislation requiring Portuguese banks to increase their Tier 1 capital ratio and to fund banks to meet the new capital requirements if needed.

The new legislation, adopted following consultations with the BoP, will require Portuguese banks to increase their Tier 1 capital ratio from the current level of 4% to 8%, in line with the policies that are now being adopted in other EU member countries. The BoP and the Government expect that local banks will need to raise between €4,000 million and 4,500 million to meet the new captial requirements. According to the Governor of the BoP, at the end of the third quarter, BES had 6.6% of Tier 1 capital and BPI and BCP 7.4%.

In the event, banks cannot obtain new equity from their shareholders or the market, the Government pledged to subscribe preferred non-voting shares. The minimum remuneration of the Government shares was not announced.

 © 2008 Macedo Vitorino & Associados


The law firm remains in the Chiado district, where it is established since 2000. The location in one of the most emblematic districts of Lisbon, the excellence of Siza Vieira project, the quality and functionality of the construction have been decisive in choosing the development “Terraços de Bragança”.

Architect Diogo Lima Mayer is responsible for the interiors architecture project which presents unique features, distinguishing it from other offices in the city and combining the tradition of the Chiado with contemporary architecture and design environments.

The new offices of Macedo Vitorino & Associados will provide an auditorium, client receptions, comfortable and functional working areas, public spaces and the most advanced information technologies.

Please consult map of our new address herewith attached.


The Portuguese Prime Minister announced the call for tenders for the construction and operation of the first section of the Portuguese high speed train network.

The construction of the section Poceirão-Caia, which is part of the link Lisbon-Madrid, represents 28% of the overall high speed rail project and will cost around €1,450 million, €250 million below the initial budget.

The concession of the section Poceirão-Caia comprises the construction and operation of 167 Km of high speed rail tracks, including the stations of Évora and Caia. The project also includes the construction and operation of a 92 Km common rail track between Caia and Évora. The rail lines will be prepared for the transportation of both passengers and freight.

According to the Government’s announcement, around 6,100 million passengers are expected to travel in the link Lisbon-Madrid per year. The number of passengers may reach 9,500 million per year in the next decades.

The tender procedure will be subject to the Public Procurement Code (PPC), which, among other things, will determine the exclusion of bids 40% below the base price and impose limitations on the value of additional works required by the contracting authority.

The PPC will also require the performance of several formalities in relation to the procurement procedure using an Internet platform, although in this first tender the bids will be submitted in paper form.

According to the tender schedule, the bidders will have four months to submit their tenders. The award of the concession is expected to occur in the third quarter of 2009 so that the link Lisbon-Madrid can enter into operation in 2013. The concession’s term will be of forty years, starting on the award date.

Based on the information provided by the Government, the political and planning risks in relation to the project will be assumed by the Portuguese State. The risks concerning the financing, construction, archaeological findings and operation of the concession will be run by the concessionaire. Finally, the risks related with safety, traffic and force majeur events will be shared between the Portuguese State and the concessionaire; when possible, force majeur risks must be covered by insurance.

The Government also pledged to compensate the losing bidders for the costs incurred with the submission of the tenders. With respect to the tenders for the construction and operation of the first section, the overall amount of the compensation will be up to €1 million, which will be distributed among the bidders based on the quality of their proposals.

More information on the project can be found at RAVE’s website at www.rave.pt.

© 2008 Macedo Vitorino & Associados


According to Decree-Law 85/2008, of 27 May, the concession of the first section of the high speed rail network will be subject to the Portuguese Public Procurement Code (PPC), which was approved in January.

In this way, the Government has anticipated the entry into force of the PPC, which was initially expected to apply only to the procurement procedures starting after 29 July 2008. According to the Government, this measure is aimed at acceleraing and harmonizing the legal framework applicable to the various tender procedures to be launched in relation with the Portuguese high speed rail project.

The call for international public tenders for the construction and operation of the section Poceirão-Caia, which is part of the link Lisbon-Madrid, should be launched in the first week of June. In accordance with the schedule initially announced by the Ministry for Public Works, the call for public tenders for the construction and operation of the second section of the link Lisbon-Madrid, which will link Poceirão and Lisbon should be launched in November 2008. Both procurement procedures are expected to be concluded by the second half of 2009, which should enable the entry into operation of the link Lisbon-Madrid in 2013.

The call for international public tenders for the construction and operation of the various sections of the links Lisbon-Oporto and Oporto-Vigo should only be launched in 2009 and are expected to be concluded in 2013 and 2015, respectively. The date for the launching of the tender procedures for the concession of the communications system was not yet announced.

Under Decree-Law 85/2008, all the procurement procedures launched in relation with the portuguese high speed rail project will be subject to the rules set out in the PPC, which will require a prompt adaptation of the operators to the new legal framework.

Among the amendments approved by the PPC, we highlight the automatic exclusion from the tender procedure of the bids worth 40% below the base price and the introduction of limitations to the additional works that may be required, i.e. 5% of the agreement’s value for the additional work and 50% for all the additional works and the rectification of errors and omissions.

On the other hand, the PPC regulates the step-in and step-out rights, which, despite being often used in public procurement procedures in Portugal were not expressly regulated under Portuguese law, as well as the concessionaire’s rights in the event of termination of the concession, with the purpose of protecting the investors and banks involved in project finance or public private partnerships.

Finally, it is expected that the new Portuguese procurement legal framework will simplify and speed up the tender procedures, namely by promoting the practice of certain acts through the web site available at www.base.gov.pt.

© 2008 Macedo Vitorino & Associados


According to recent news, the Portuguese Government is planning to launch two new road concessions until the end of the year: the Pinhal Interior concession and the concession for the construction and operation of several roads in the region of Ribatejo. These new road concessions, which are part of the National Road Plan (NRP), will represent an overall investment of around 880 million euros.

The Pinhal Interior concession will link the cities of Coimbra and Santarém and will include the construction of 158 Km of new roads and the operation of 164 Km of existing roads, in an aggregate investment of approximately 640 million euros. It is likely that the Pinhal Interior concession will be officially announced by the end of May.

The Ribatejo concession, which should be launched by the end of 2008, will comprise the construction of 73 Km of new roads and the allocation to private investors of 36 Km of existing roads, in an overall investment of around 240 million euros.

This announcement followed the launching in 2007 and 2008 of several calls for public tenders for the construction and operation of various roads and motorways in connection with the completion of the NRP. The road concessions planned by the Portuguese Government for the next few years represent an overall investment in excess of 3,000 million euros.

The calls for international public tenders in respect of the Transmontana Motorway, Douro Interior, Baixo Alentejo and Baixo Tejo concessions, which were launched in the end of 2007, are now in the bidding phase and the award of these concessions should take place before the end of 2008.

More recently, by the end of March, the Government launched new tender procedures for the concession for the rehabilitation of the National Road 125, the Litoral Oeste concession and the Centro motorways concession, in an aggregate investment in excess of 1,000 million euros. The call for public tenders for the construction and operation of the Alto Alentejo motorway concession will only be launched in the second half of 2008.

According to the Government plans, the new road concessions should be completed in 2011, except for the Alto Alentejo concession, which is expected to be completed in 2012. The time schedules for the Pinhal Interior and the Ribatejo concessions have not been announced yet.

The completion of the NRP has been attracting the attention of several local and international investors, contractors and banks, especially due to Portugal’s long experience in road concessions under public private partnerships schemes. Some of the leading portuguese and Iberian players, such as Brisa, Mota-Engil, Iridium/Dragados, Edifer, Tecnovia, Conduril, Somague, Teixeira Duarte, Cintra and Soares da Costa have already formed consortia with the purpose to biding in the current and the upcoming tenders.

© 2008 Macedo Vitorino & Associados


The Portuguese Ministry of Public Works, Transport and Communications intends to keep his promise to launch the call for international public tenders for the construction and operation of the first section of the link Lisbon/Madrid (Poceirão/Caia) in June 2008, which also comprises the construction of a common rail track between Caia and Évora. This section of the project should represent an overall investment of 1,700 million euros.

The call for public tenders for the construction and operation of the section Poceirão/Lisbon should be launched in the last quarter of 2008.

According to the Minister of Public Works, the award of the tenders should take place in the second semester of 2009, due to the technical complexity of the project.

The Portuguese High Speed project is expected to represent an overall investment of approximately 8,000 million euros and has been attracting the attention of several local and international contractors, operators, infrastructure funds and banks.

Market sources report that Mota-Engil, Somague and, presumably, Teixeira Duarte, three of the largest Portuguese construction companies, will form one of the consortia that will bid in the high speed train projects.

Brisa, the largest Portuguese motorway operator, BCP, BES and other main Portuguese contractors, which may include Bento Pedroso, are also reported to be finalising the formation of a second consortium. It is likely that TIIC - Transport Infrastructure Investment Company, the infrastructure fund formed by Brisa, Millennium Investment Banking and La Compagnie Bengajmim de Rothschild, will be one of the members of this group.

Other local and interantional players, including among others Soares da Costa, Dragados, FCC, Cintra, Ferrovial, OHL, Bouygues, Vinci and Eiffage should also join the existing groups or form new consortia to bid in upcoming tenders.

It is expected that there will be at least three but most likely four or more groups will be bidding in the Portuguese high speed projects.

According to the business model announced in 2007, the project will be divided into six concessions, with the duration of forty years. The construction of the infrastructure will be split in five sections of the rail network, each awarded to a different consortium:

(a) Two sections of the link Lisbon/Oporto;

(b) Two sections of the link Lisbon/Madrid; and

(c) One section of the link Oporto/Vigo.

The telecommunications and signalling systems will be commissioned and operated by a separate entity.

The operation of passengers’ service will be carried out by private operators operating the rolling stock under a lease from the Portuguese State.

© 2008 Macedo Vitorino & Associados


The environmental report submitted by the National Laboratory of Civil Engineering (Laboratório Nacional de Engenharia Civil – LNEC) confirmed that there were no environmental obstacles that could lead to the reversion of the Government’s preliminary decision to build the new Lisbon international airport (NLA) in Alcochete.

The next step will be the sbmission of an environmental impact report that confirming the compliance of the project with EU environmental rules, which is expected to be completed in the coming months.

Following the formal approval of the change of location by the Council of Ministers, the Portuguese Government will request to the European Commission the confirmation that the funds that had been committed by the Eurpean Union to the construction of the airport in OTA can be used for the construction of the NLA in Alcochete.

The Minister for Public Works, Transport and Communications announced that the construction of the NLA should be completed in 2017, in accordance with the initial schedule and that the launch of the public tender for the design, construction and operation of the NLA should take place in 2008.

Up until now, the transaction model approved would involve the privatization of ANA – Aeroportos de Portugal S.A. (ANA), the State company responsible for the operation of several Portuguese airports (which includes the renegotiation of the concession for all airports now operated by ANA, namely the Oporto, Faro, Ponta Delgada, Horta, Santa Maria and Flores ariports) and the concession for the planning, construction, financing and operation of the NLA.

The NLA project involves an overall investment of approximately €4,900 million, which has been attracting the attention of several local and international contractors, operators, infrastructure funds and banks.

In 2006, Brisa, the main highway concessionaire in Portugal, Mota-Engil, one of the largest Portuguese construction companies, and Somague, also one of Portugal’s main contractors, now controlled by Sacyr, together with Banco Espírito Santo, Millenniumbcp and Caixa Geral de Depósitos formed a consortium named Asterion, with the intention to bid for the NLA.

Meanwhile, other entities that are reported to be interested in this project include local contractors, Teixeira Duarte, MSF, Edifer, Bento Pedroso, Construtora do Tâmega, Alves Ribeiro, Zagope, OPCA, Grupo Mello, Efacec or Soares da Costa, as well as international players, such as Fraport AG, Vinci, Transdev, Airports of Paris, which has already participated in some of the developing stages of the NLA project, Dragados, BAA, Ferrovial, Bouygues, Albertis and Macquarie.

If you want to receive Macedo Vitorino & Associados briefing on the NLA project, please send an email to any of the contacts above.

© 2008 Macedo Vitorino & Associados


1. Introduction
The main public works projected by the Portuguese Government for the forthcoming years will require an investment over 16,000 million euros until 2015 and will be carried out under public-private partnerships (“PPP”) schemes.
The key decisions in respect of the high-speed rail network, including the third bridge over the Tagus River, the new Lisbon airport (“NLA”) and the conclusion of the National Road Programme have been made and the first public tenders have already been launched.

2. High-speed rail network
The Portuguese high-speed rail network project will represent an overall investment of over €8,000 million. The announced business model comprises six PPPs divided by the several sections of the lines Lisbon/Oporto, Lisbon/Madrid and Oporto/Vigo. Telecommunications and signalling systems will be commissioned to a separate entity.
The first public tenders are expected to be launched during the current year and the high-speed rail network should be operational in 2015.

3. New Lisbon airport
The construction of the NLA, in Alcochete, will represent an investment of around €4,900 million. The business model disclosed by the Government combines the privatization of ANA – Aeroportos de Portugal, S.A. and the awarding of the concession for the planning, construction, financing and operation of the new Lisbon airport during 30 years.
The final approval of the location of NLA, which was decided early in 2008, caused slight delays to the original project and forced the redefinition of the high-speed train route. However, the public tender is expected to be launched in the second semester of 2008.

4. National Road Programme
In December 2007, the Portuguese Government announced the launch of several road subconcessions, in an estimated investment of €3,100 million.
The public tenders for the Trás-os-Montes Motorway, the Douro Interior, the Baixo Alentejo, the Baixo Tejo, the Centre Motorway, the Litoral Oeste and the rehabilitation of EN125, in Algarve, were already launched. All these roads should be completed and operational in 2012.

5. Hydroelectric dams
During this month of April, the Portuguese Government will launch the public tenders for the construction and operation of nine hydroelectric dams, representing an overall investment of around €1,500 million. The new infra-structures will increase the domestic capacity of producing electric energy based on renewable resources around 1,144 megawatts and should be completed in 2015.  

© 2008 Macedo Vitorino & Associados