A recent amendment to the Water Law stipulates that multi-municipal systems are to remain under public control and may only be granted under concession to public owned or controlled companies, while municipal systems may be managed by public-private partnerships or by private entities. Consequently, and to this extent, Portugal remains partially open to international water sector private investors.

The new rule implies the reversal of the reorganization of the water sector that resulted in the merger of 19 multi-municipal systems into 5 large companies, initiated by Mr. Passos Coelho’s social democrat government.  The current government intends to merge municipal systems serving less than 20.000 users and, for that purpose, maximize the use EU structural funds allocated to Portugal.

Portuguese multi-municipal water systems encompass the collection, purification and distribution of water and are connected to municipal systems which, in turn, link the multi-municipal systems to end users. In Portugal, the State is responsible for the multi-municipal systems and municipalities are responsible for the municipal systems. For a better understanding of the Portuguese water sector, please refer to our publication The Water Market in Portugal.

 

2017-06-29

From 3 July 2017, the process of acquiring Portuguese nationality will be faster and more predictable.
The streamlining of the process is due to the measures introduced by Decree-Law no. 71/2017, of 21 June, namely: 

  • The attribution to the Central Registry Office (Conservatória dos Registos Centrais) of the possibility to conclude that the applicant has ties to the Portuguese community (previously, such competence was assigned to the member of the Government responsible for justice);
  • The creation of presumptions of effective connection to the Portuguese community and knowledge of Portuguese language; and  
  • The waiver of presentation of the applicant’s criminal record of his country of birth or his country of nationality when the applicant has not lived there after completing 16 years.

As from July 2017, issuers, intermediaries and management entities will be subject to new rules arising from the implementation of directives relating to transparency requirements (Directives 2013/50/EU and 2007/14/EC), prospectus (Directive 2003/71/EC) and criminal penalties for market abuse (Directive 2014/57/EU and Implementing Directive 2015/2392).

The implementation was approved by Law no. 28/2017, of 30 May, which also amended the Portuguese Securities Code (Securities Code) in order to adapt it to Regulation (EU) no 596/2014 on market abuse (Market Abuse Regulation) and appointed the Portuguese Securities Market Commission (Comissão de Mercado de Valores Mobiliários - CMVM) as the competent authority to ensure the application of the Market Abuse Regulation in Portugal.

Among other changes, new administrative offences and crimes were added, some penalties were aggravated and some duties, requirements and limitations are now cross-referred with those established in the Market Abuse Regulation, including (without limitation) regarding investment recommendations, market abuse, inside information or managers’ transactions and duty to report suspicious transactions.

As an example of the aggravation of the penalties, in a case of market manipulation the maximum penalty increased from five to eight years of imprisonment if the relevant conduct causes an “artificial” change in the regular operation of the market.

For less serious administrative offences, the applicable fines increased from 2,500€ and 5,000€ to 5,000€ and 1,000,000€, respectively.

The statutes of limitation in the case of very serious administrative offences were also increased from five to eight years and the following ancillary penalties were added: (i) suspension of dealing on financial instruments for its own account and (ii) cancellation of registration or revocation of the authorisation for the exercise of functions in entities supervised by the CMVM.

In addition to these changes, greenhouse gas emissions allowances will also be subject to Securities Code rules. As a result, transactions involving these instruments and parties to these transactions will be subject to the supervision of the CMVM, as well as to the new sanctions contemplated in the Securities Code, starting as of 2 January 2018.

Finally, benchmark indexes and spot commodity contracts will also be subject to market manipulation prohibition set out in the Market Abuse Regulation and, consequently, to the supervision of the CMVM and the sanctions now contemplated in Securities Code.

2017-05-04

As from today, 4 May, bearer securities will no longer be permitted in Portugal and any existing bearer securities must be converted into nominative securities within the next 6 months.

Pursuant to Law no. 15/2017, enacted today, terms applicable to the conversion of bearer securities into nominative securities will be defined under a specific regulation to be enacted within 120 days. In case this regulation is issued towards the end of this 120-day period, entities may, in practical terms, have less than 6 months to complete the required conversion.

Once the 6-month period has elapsed, transfer of bearer securities will not be permitted. In addition, rights of the holders of bearer securities to receive any dividends in respect of such securities will be suspended.

Bearer securities, such as, for example, bearer shares of a limited liability company, belong to whoever holds the relevant share certificate. Unlike nominative securities, the issuing entity is not able to identify to the owner of bearer securities nor to track transfers of ownership.

The prohibition of bearer securities now enacted aims at controlling and preventing money laundering and tax evasion by ensuring that ultimate beneficial owners of investments and assets may be identified.

The Portuguese Government has changed the feed-in-tariffs scheme aiming at eliminating the accumulation of public incentives for generation of renewable energies that has been allowed to this date.

Ordinance No. 69/2017, recently published, provides for the deduction of the subsidies received for the promotion and development of renewable energies when producers have cumulatively received other incentives. This way, producers shall also be forced return the funds already received. The list of producers covered by this ordinance and the amounts to be deducted or to be returned (if in the meantime producers cease to be entitled to the feed-in-tariff) will soon be published. 

With its retroactive effects, this decision sets a new precedent in counter-cycle to the long stand police of regulatory stability in the Portuguese renewables’ sector.  And, at a time when other countries like Spain are taking steps to relaunch their renewables market, this decision is, most likely, not helping to attract new renewables’ investment projects to Portugal, irrespectively of the bigger or smaller material impact it may have on those who will be effected by it, which is yet to be seen.

2016-10-06

Almost a year after the signature of the Paris Agreement, a date has been set to come into force: November 4th 2016.

This agreement will become in effect 30 days after the date on which at least 55 members to the UNFCCC (United Nations Framework Convention on Climate Change) which together represent at least an estimated 55% of total global emissions of greenhouse gases, have deposited their instruments of ratification, acceptance, approval or accession.

Portugal has deposited its ratification instruments, after the Portuguese Parliament and the President of the Republic of Portugal having both approved and ratified, respectively, the Agreement, making Portugal one of the 55 countries required for its entry into force. In order to reach the goal of a sustainable development, strengthen the global response to climate change and eradicate poverty ambitious targets have been set.

The Paris Agreement aims to hold the increase in the global average temperature to well below 2°C and lower greenhouse gas emissions. Portugal, along with the E.U. Member States, committed to a binding target of an at least 40% domestic reduction in greenhouse gas emissions by 2030.

 

2016-09-30

The World Bank has published a report about public-private partnerships in different economies, including Portugal, with particular focus on the current legal framework and its practical application.

The development of this study had the collaboration of lawyers of Macedo Vitorino & Associados, Susana Vieira, André Dias and António de Macedo Vitorino, thereby acknowledging the expertise in the area by the office.

This study aims to inform the decision-making about the procurement policies and regulations of PPP, comparing different economies and recognizing good practices to ensure transparency and encourage competition.

You can read the full study in PDF.

 

2016-07-19

Portugal has ratified two new Conventions for the Avoidance of Double Taxation and the Prevention of Tax Evasion with Respect to Taxes on Income that were signed with the Kingdom of Saudi Arabia and with the Sultanate of Oman on 28 April 2015.

The new Conventions will enter into force after the publication in the Official Gazette of the notices of the Ministry of Foreign Affairs regarding the exchange of the ratification instruments.

The Portuguese Parliament approved the 2016 Portuguese State Budget.

Learn more here about the tax changes of PIT (personal income tax), Participation exemption, Carry-forward tax losses, Reporting and ancillary duties, VAT (value added tax), IMT (property transfer tax), SD (stamp duty), Banking sector special contribution and Excise duties.

2016-03-30

The Portuguese Government approved 850 resident permits (Golden visa) last month, boosting ARI (Residence Permit for Investment Activity programme) launched in 2012 as a quick solution for investors from outside the Schengen area to obtain a residence permit in Portugal.

This plan includes new rules on the awarding of residence permits for investment activity, known as “golden visa”, to citizens of non-European Union (EU) countries that wish to make a significant investment in Portugal and meet certain requirements.

The “golden visas” grant their holders the right to free circulation in Portugal and in the rest of Schengen area countries. In addition to general requirements applicable to residence permits, “golden visas” require their holders to undertake the obligation of investing in Portugal of certain minimum amounts for a minimum period.

Macedo Vitorino presents «Why portugal - The case for living in Portugal». In this paper, you will find an outline of the opportunities of living in Portugal and of the main aspects to be thought-out by everybody considering Portugal as a place to live.

Learn more here.