In times where the need for digital literacy and universal access is more apparent than ever, individuals, companies and the public administration will be pillars of the new Action Plan for Digital Transition (the “Action Plan”) just published by the Portuguese government, as part of a medium term digital strategy for Portugal to be implemented from 2020 to 2023.
Individuals’ digital inclusion is a keystone of the Action Plan, given that one quarter of the Portuguese population has never used the internet, which is significantly above the European average (this is having a negative impact on the student availability for online schooling during the Covid-19 crisis). The new Upskill program will requalify professionals in information and technology-related areas and is expected to allocate a number of requalified persons in companies in need of man work.
The Action Plan also aims to provide intensive training to three thousand participants over six months, in order to respond to the scarcity of IT human resources. The plan should bring at least one million adults into the digital economy, and it is also providing low fare tariffs for internet services. Interesting to see how its implementation will be affected by the ongoing Covid-19 lockdown measures.
As regards companies, territory-specific regulatory sandboxes are expected to be created in a number of Portuguese regions in order to promote research and development and testing of innovative products and solutions. Both +CO3SO Digital, a programme to bring digital entrepreneurship to less populated regions, and E-Residency, an Estonian-inspired virtual citizenship project, will target an international and digitally-inclusive outlook for the Portuguese economy.
Startup Visa, Tech Visa, Sign Up for Portugal and Startup Hub are examples of other company-oriented projects and programmes, specifically targeting the creation of a proper entrepreneurial ecosystem. Portugal is set to invest in the digital transition of businesses.
Public administration will be subject to transformative measures in the most used services by citizens, including the use of cloud computing, digital public services, digitally-enabled schools and internationally accessible public services.
To some extent, we can say that this Action Plan is mostly a repackaging or an extension of existing incentive plans, such as +C03SO, or Startup Visa, focusing on digital transition. It comes along with the 5G auction, set to occur in 2020 (you can read more about the 5G Auction here), to the support the digital transition of Portuguese economy to the digital era.
The General Data Protection Regulation (GDPR), which is applicable since 25 May 2018, governs the processing of personal data throughout the European Union (EU). GDPR aims at ensuring a consistent and high level of data protection within the EU without jeopardising the free flow of data within the EU.
The GDPR has replaced Directive 95/46/EC of 24 October 1995 in force since 1995, and it superseded national data protection laws, including Law 67/98, of 26 October 1998. Along with the GDPR, Law 58/2018, of 8 August 2019, which implements some local specifics, is also in force in Portugal (GDPR Local Law).
Public and private entities are taking exceptional measures to prevent and mitigate COVID-19 across the EU, including in Portugal, where it was decreed a situation of state of emergency on 19 March 2020 and extended, at least, until 2 May 2020.
In this context, the Portuguese Data Protection Authority (DPA) has issued four papers:
(a) Resolution number 2020/170 of 16 March 2020, whereby all formal regulatory actions in connection with outstanding information request backlogs are suspended; and
(b) Three guidelines:
(i) Guidelines of 2 April 2020 on the use of video surveillance systems and alarms in the COVID-19 context, where the DPA stresses that private security companies are prohibited from carrying out activities falling into the scope of the exclusive powers of judicial or police authorities, including border control and the prevention and repression of crimes in public places;
(ii) Guidelines of 9 April 2020 on the use of distance learning technologies considering that Portuguese students are taking e-learning classes from their homes; and
(iii) Guidelines of 17 April 2020 on remote control means of employees under a distance work regime issued in response to several questions on the use of software for control of employees’ performance in teleworking, and the imposition on employees of a permanent connection to the video camera. The DPA clarifies that the use of such software tools is disproportionate and infringes data protection principles, and that labour rules prohibiting distance control means of employees’ activity remain applicable.
Apart from these four initiatives, no additional information is available in connection with data protection and COVID-19. Inversely, other EU data supervisory authorities, for instance, in the UK and Germany, have disclosed a set of materials and FAQs at their websites to respond to data protection questions arising from the current situation.
The current situation may involve the processing of different types of personal data, including special categories of personal data, such as health data, namely within an employment context. In a COVID-19 scenario (not only at the current stage of spreading, but also at subsequent stagnation and mitigation stages), the processing of personal data may be necessary for compliance with employers’ statutory obligations, e.g. obligations relating to health and safety at the workplace, or to the public interest, e.g. the control of diseases and other threats to health.
Bearing in mind that several questions may arise within an employment context (but not limited to), we have prepared a list of FAQs to help organizations to be able to respond to such new challenges.
1. May employers collect personal data of employees to prevent the spreading of the COVID-19 virus at the workplace? In affirmative case, what personal data is the employer allowed to process in this context?
Yes, employers may collect personal data of employees in order to prevent the spreading of the virus at the workplace to the extent that it is required to fulfil employers’ statutory duties (e.g. duty of care) and to organise the work in line with the Portuguese legislation, namely Portuguese labour rules.
The criteria should be whether the processing is necessary for a given purpose (e.g. processing that is necessary for the protection of the health of employees and for compliance with statutory reporting obligations), and the implementation of the GDPR’s principle of data minimization.
In principle, the collection of the following data will not raise major issues: name, current contact information, contacts with other persons within the organization, previous or intended stay in a high risk area, previous contacts with allegedly infected persons or whether a person is symptom-free.
Inversely, health data, which is considered a special category of data, is subject to restrictions and that require an adequate interrelation between the GDPR, the GDPR Local Law and the Portuguese labour rules, as detailed below.
2. In these circumstances, what requirements must employers comply when they carry out processing of employees’ personal data?
Employers may collect and process personal data of employees, including health information, to determine whether (i) they are infected or have been in contact with an infected person, or (ii) they were in a high-risk area during the relevant period.
Employers should inform employees about COVID-19 cases and take protective measures, but they must not disclose more information than it is required.
Employers must keep employees informed about cases in their organisation, but they must not name individuals. The disclosure of personal data of infected persons (confirmed and suspected) to inform colleagues or externals is only lawful on condition that it is strictly necessary under exceptional circumstances to know the identity of that person, in order to mitigate the spread of the COVID-19 and allow employees to take relevant safeguards. In these very exceptional cases (where it is necessary to reveal the name of the employees who contracted the virus, e.g. in a preventive context), the concerned employees shall be informed in advance and their dignity and integrity shall be protected.
3. What is the relevant lawful basis for such data processing by employers?
As regards employees, the relevant lawful basis is the GDPR’s legitimate interests (Article 6/1(f) GDPR).
Where health data is processed, the relevant legal basis should be the GDPR’s employment and social protection legal basis, i.e., processing that is necessary for the purpose of carrying out the obligations and exercising specific rights of the employer or of the employees in the field of employment and social security and social protection law (Article 9/2(b) GDPR).
As regards local law, namely the labour law and the GDPR Local Law, we should stress the following rules:
(a) Article 28/1 of the GDPR Local Law states that the employer may process employees’ personal data for the purposes and within the limits set out in the Portuguese Labour Code;
(b) Article 17/1 (b) of the Portuguese Labour Code states that the employer may not ask for the employee to disclose health data, save as when exceptional circumstances related to the professional activity may justify such disclosure and relevant grounds are provided in writing by the employer. Health data are provided to a medical doctor, who may only inform the employer on whether the employee is or not able to performance their job functions; and
(c) Article 29/2 of the GDPR Local Law states that special categories of data, namely health data, may be processed for reasons of public interest in the area of public health, such as protecting against serious cross-border threats to health, and that suitable and specific measures to safeguard the rights and freedoms of the data subject, in particular professional secrecy, must be adopted.
This means that the employer’s legitimate interests’ legal basis and, for health data, the employment and social protection legal basis, result from the general duty of care of the employer toward their employees. Health date must be processed by the employer, through a medical doctor subject to professional secrecy, which means that health data may not, in principle, be disclosed to other employees, unless in exceptional circumstances and insofar it reveals necessary to avoid the spreading of the COVID-19 at the workplace.
Under the duty of care, the employer must ensure the protection of the health of all employees. This also includes carrying out an appropriate response to the dissemination of the COVID-19, for prevention and traceability purposes (i.e., subsequent prevention toward contact persons).
It should be also noted that the GDPR includes derogations to the prohibition of processing of certain special categories of personal data, such as health data, where it is necessary for reasons of substantial public interest in the public health area (Article 9/2(i) GDPR), on the basis of EU or local law, or where there is the need to protect the vital interests of the individuals (Article 9/2(c) GDPR). As recital 46 GDPR states some types of processing may serve both important grounds of public interest and the vital interests of the individuals as for instance when data processing is necessary for monitoring epidemics and their spread.
In turn, employees’ consent cannot be considered as a lawful basis, as, in an employment relationship, there is a clear imbalance between employees (data subjects) and the employer (controller). It is unlikely that employees’ consent is freely given in the context of an employment relationship.
4. May employers process personal data of workplace visitors for COVID-19 related purposes?
Yes, employers may process personal data of workplace visitors for COVID-19 related purposes to determine whether (i) they are infected or have been in contact with an infected person, or (ii) they were in a high-risk area during the relevant period, and to the extent that the measures to be adopted are proportionate.
As regards visitors, measures against third parties that require the processing of health data can be justified based on the GDPR’s lawful basis regarding processing that is necessary for reasons of public interest in the area of public health, such as protecting against serious cross-border threats to health (Article 9/2(i) GDPR).
The consent of visitors (data subjects) can only be considered as a lawful basis for COVID-19 measures if they comply with all consent requirements, including if visitors are informed about the data processing and can provide consent about the measures voluntarily. This means that visitors should be aware at least of the identity of the data controller (the organization) and the purposes of the processing for which the personal data are intended in the context of COVID-19.
5. Are private mobile phone numbers and email addresses of employees allowed to be collected?
During the pandemic, employees may work from home more frequently than usual and they can use their own device or communications equipment. The collection of private mobile phone numbers and email addresses of employees may be necessary and hence lawful if they are to be used to ensure their "ongoing availability" during the current COVID-19 crisis, namely if employees are working through a distance work regime.
It may be also necessary if, for instance, an overload of the organization's IT infrastructure makes it necessary to communicate within the employer and/or other employees. In this case, care must be taken to ensure that no sensitive data is disclosed by means of "unsafe" communication means, namely email services, where there is a risk of unauthorized access to data by third parties.
Employers and employees need to consider the same kinds of security measures for homeworking that they use in normal circumstances, for instance, hardware and software encryption, a two/three-level password authentication system, keeping access log files. The data may only be used for the intended purpose and must be deleted immediately after the processing purpose has ceased to apply.
6. May employers use technological solutions for remote control of their employees’ performance through a distance work regime? May videoconference calls between employees or between the employer and employees be recorded?
According to recent guidelines issued by the DPA, the general rule prohibiting the use of means of remote surveillance to monitor employees’ performance is fully applicable in a distance work context. The same conclusion would always be reached by applying the principles of proportionality and minimization of personal data, since the use of such means implies an unnecessary and excessive restriction of employees’ private life.
For this reason, technological solutions for remote control of the employee's performance are not allowed. Examples of this are software that, in addition to tracking working time and inactivity, records the Internet pages visited, the location of the terminal in real time, the uses of peripheral devices (mousse and keyboards), capture images of the working environment, observe and record when the access to an application is initiated, control the document in which the employee is working and record the respective time spent on each task (e.g., TimeDoctor, Hubstaff, Timing, Manic Time, TimeCamp, Toggl, Harvest ). This type of tools manifestly collects excessive personal data from employees, promoting the work control at a higher level than that which can legitimately be carried out at the employer’s premises. The fact that the work is being carried out from home does not justify a further restriction towards employees. To that extent, the collection and subsequent processing of such data violates the principle of minimisation of personal data.
Similarly, it is not allowed to require the employee to keep the video camera on a permanent basis, nor, it is, in principle, allowed to record videoconferences between the employer and employees.
Despite the prohibition of the use of such tools, the employer keeps the power to control the activity of the employee, which it may do, namely, by setting objectives, creating reporting obligations as often as it deems necessary, scheduling meetings by videoconference.
7. May employees’ files be processed in an employee’s home office (e.g. in the home office of the Human Resources staff)?
The processing of employees’ files in an employee’s home office can only take place in exceptional circumstances if it is strictly necessary and to the extent that technical and organizational measures are taken to protect personal data, including, for instance, hardware and software encryption, a two/three-level password authentication system, keeping access log files, not printing in the home office.
If you need any further clarifications or assistance in any questions on data protection matters, please do not hesitate to contact us.
The European Commission has recently issued guidelines for the development of contact tracing and warning applications in the fight against COVID-19, which can have a significant impact in the control of the disease and play an important role as part of containment measures.
Contents. These applications may include: (i) accurate information about the COVID-19 pandemic for users; (ii) self-diagnostic questionnaires and guidance for users (symptom control feature); (iii) alert notification to persons who have been in close contact with an infected person for testing or be isolated (contact tracing and warning features); and/or (iv) a communication forum between patients and physicians, including providing further diagnosis and treatment advice (e-treatment advice).
Applicable regulations and supervision. Given the extremely sensitive nature of the data (in particular health data) and the purpose of the applications, they must comply with the General Data Protection Regulation (GDPR) and the Electronic Privacy Directive. They must also be implemented in close coordination with and under the supervision of the relevant public health authorities and national data protection authorities.
User control and consent. Users must keep full control over personal data and hence they must give their prior consent (complying with GDPR requirements) and separately for each application’s features.
In case of use of location data, this data must be stored on the user's device and only be shared with their prior consent; users must be able to exercise their rights under the GDPR and, among others, they have to be entitled to, at any time, withdraw their consent.
Principle of data minimization and data accuracy. Applications must comply with the principle of data minimization and it may be only processed personal data required for the purpose at stake. For example, for the purpose of tracing contacts, the European Commission considers that the processing of location data is not necessary and thus it does not advise its use.
EU rules require that processed personal data are accurate. Therefore, the Commission considers that technologies such as Bluetooth should be used to more accurately assess contact between different users. The data must be stored on the user's device and encrypted and must only be kept for the necessary period, in medical terms, and for the duration of the containment measures.
For the success of these applications, the confidence of citizens and those who feel safe with their use is essential, which must be ensured under strict compliance with EU rules on personal data protection.
Following the extension of the state of emergency in Portugal until 17 April 2020, the Portuguese Parliament enacted new legislation with a view to mitigate the impact of coronavirus pandemic in lease agreements.
Law no. 4-C/2020 of 6 April 2020 is applicable to housing and commercial leases, as well as to other forms of exploring real estate assets, and to the rents falling due between 1 April 2020 and the first month after the expiry of the state of emergency.
In housing lease agreements, tenants whose households have suffered a significant income reduction (to be determined pursuant to the new legislation) may delay payment of the above-mentioned rents. Provided that the amount of the delayed rents is paid during the subsequent 12-month period - in monthly instalments of not less than 1/12 of the total amount and together with the relevant rents - landlords will be prevented from terminating lease agreements. Tenants in these circumstances may, alternatively, file an application with the Portuguese Institute for Housing and Urban Rehabilitation (Instituto da Habitação e da Reabilitação Urbana - IRHU) to obtain an interest-free loan to cover payment of rent.
In case tenants wish to make use of these rules, they must inform the landlord in writing at least 5 days before the relevant rent falls due or until 27 April 2020 for the rent falling due in April.
Landlords suffering a significant income reduction arising of the suspension of payment of rents by tenants now permitted, may also apply for an interest-free loan with IRHU to cover income they stop receiving.
As to commercial lease agreements, tenants with businesses under lockdown or activity restrictions due to mitigation and containment measures (such as, for example, restaurants, which are only allowed to sell for take-away or home delivery), may defer payment of the above-mentioned rents to the subsequent 12-month period, where the deferred amount should be paid in monthly instalments of not less than 1/12 of the total amount together with the relevant rents. No penalties for delay may be claimed to tenants.
Other measures already in place with a view to mitigate impact of the coronavirus pandemic in lease agreements include suspension of early termination of lease agreements by landlords, suspension of expiry of lease agreements at the end of the relevant term (unless accepted by tenants) and prohibition of terminating commercial lease agreements with grounds on business lockdown or activity restrictions.
Following the most recent extension of the state of emergency (up to 17 April), the Portuguese Parliament enacted new legislation ending the suspension of the procedural time limits in urgent proceedings as from today.
Law 4-A/2020, of 6 April 2020, amending previous measures on the functioning of the courts’ activity during the emergency period, came into force today and ceases the suspension of procedural time limits for the performance of procedural acts and diligences before courts in urgent proceedings, namely, insolvency proceedings and precautionary measures.
The end of the suspension does not however affect the suspension period already elapsed in accordance with Law 1-A/2020 (now amended), that is, between 9 March and 6 April 2020.
In order to discourage companies from going into insolvency and to safeguard directors from any legal consequences that might result from failure to comply with this statutory duty during the emergency period, the legal deadline for filing for insolvency is suspended, even though pending insolvencies remain in progress. Acts performed within the scope of enforcement proceedings, namely the sale of assets and other acts of attachment of the debtor's assets, are also suspended to the extent that they do not cause serious damage to the creditor's survival.
In short:
- In cases of urgent proceedings, the procedural time limits are no longer on standby from 7 April 2020, but the suspension period between 9 March and 6 April 2020 is not counted for time limits purposes;
- In cases of non-urgent proceedings, the procedural time limits are suspended from 9 March 2020 and they will continue suspended until the end of the state of emergency.
Notwithstanding the suspension of time limits in non-urgent proceedings, the law clarifies that the current situation of state of emergency does not, however, hinder the carrying out of the proceedings and the performance of their relevant acts either face-to-face acts or using distance means when all the parties consider that they have the conditions to ensure their performance through online platforms. In non-urgent proceedings, courts may also render a final decision in cases in which they understand not to be required the performance of further actions.
On the same subject, you may also view our previous newsletter, available here.
The Portuguese Government approved the Decree-law 12/2020, of 6 April transposing Directive (EU) 2018/410 of the European Parliament and of the Council, approved in the sequence of the Paris Agreement and its decarbonization goals.
Entities on the national list of facilities covered by the ETS list may benefit from free of charge emission permits, upon request to the Portuguese Environmental Agency (Agência Portuguesa do Ambiente, I.P.) (“APA”) in a specific form for the collection of data and methodology report. The criteria for the allocation of free of charge emission permits are based on fully standardized measures which set benchmarks at Community level.
Emission permits not granted under the free of charge method shall be subject to a sale in auction, the revenue from which shall be used for measures contributing to the development of a competitive and low carbon economy.
For the first time in Portugal, ETS of low emission installations (up to 25.000 tCO2eq) will not need an emission permit, provided that they are subject to measures allowing an equivalent contribution of emission reductions, or very low emission installations (up to 2.500 tCO2eq), without any equivalent measure. In addition, the amount of free emission permits is adjusted to the operators’ activity if its levels decrease or increase by 15% compared to the level used to establish the emissions.
Failure to obtain an emission permit, when mandatory, is an administrative offence and the owner of the relevant facility may be subject to the payment of a penalty up to the amount of 5 million euros if committed with intent, or 144 thousand euros if committed by negligence.
On the other hand, failure to comply with the threshold of the emission permit, entails the duty to financially compensate the Portuguese State, under the “polluter pays” principle, corresponding to the emission excess, and taking into account the possible costs that the owner would have incurred by buying more emission licenses in the auction.
The new regulation becomes effective on 7 April 2020.
On April 2nd, the declaration of a state of emergency was renewed by Decree of the President of the Republic, no. 17-A/2020, of April 2 (Portuguese only).
With regard to employees' rights, the law establishes the suspension of the exercise of the right to strike to the extent that it may compromise the functioning of critical infrastructure, health care units and essential public services, as well as in economic sectors vital to the production, supply and distribution of goods and services essential to the population.
This measure was already provided for in the previous decree of the President of the Republic that declared a state of emergency, now extending the suspension to essential public services.
The same decree also defines the suspension of the right of trade union associations to participate in the drafting of labor legislation to the extent that the exercise of such right may represent a delay in the entry into force of urgent legislative measures for the purposes foreseen in the decree.
Following the continuity of the state of emergency, the Government approved a set of additional provisions in order to reduce the possibility of contamination and propagation of illness, through Decree no. 2-B/2020 of 2 April (Portuguese only).
In addition, other employment actions were taken, namely the reinforcement of the competencies of the Authority for Working Conditions (ACT), through the requisition of inspectors.
The ACT inspectors will now have the power to suspend any dismissal when they see evidence of illegality, without the need for recourse to the courts.
With this measure, the Government intends to prevent Employers, during the current state of emergency, from making abusive dismissals.
The suspension of the right to strike and the possibility for the ACT to preventively suspend dismissals should disappear after the end of the state of emergency.
The Portuguese Government passed Decree-Law 10-F/2020, which approved new fiscal support measures to mitigate the social and economic impacts arising from COVID-19, which are in addition to the measures already approved by Order 104/2020-XXII and Resolution 71-A/2020. In this newsletter, we describe the main fiscal support measures approved sofar.
Extension of deadlines for annual tax returns and advance payments
Order 104/2020-XXII approved the following measures:
- The annual tax returns (Model 22) for the year 2019 may be filed until 31 July 2020;
- The special advance payment (pagamento especial por conta) may be delivered until 30 June 2020; and
- The first advance payment (pagamento por conta) and the first additional advance payment (pagamento adicional por conta) may be delivered until 30 August 2020.
Deferral of delivery of VAT and withholding taxes
Decree-Law 10-F/2020 allowed the payment of VAT and CIT and PIT withholdings in three- or six-monthly instalments, interest free, for self-employed workers and companies with a turnover up to €10 million in 2018, which have begun their activity as of 1 January 2019 or that operate in closed sectors (Decree no. 2-A/2020).
The remaining companies and self-employed workers who do not meet the conditions set out above may apply for a fractionation of the payment when there has been a decrease in the turnover of at least 20% in the average of 3 months preceding the month in which this obligation exists, compared with the same period of the previous year.
Requests for payment in instalments should be submitted electronically by the deadline for voluntary payment and no guarantee is required.
Deferral of social security contributions
Social security contributions due between March and May 2020 can be paid as follows:
(i) One third in the month in which it is due (in the month of March, exceptionally, by the 31st);
(ii) The remaining amount will be paid in equal and successive instalments in July, August and September 2020 or in the six months between July and December 2020, interest free.
This measure applies automatically to self-employed workers and to employers with up to 50 employees.
Other employers can also access this mechanism if they have a decrease in the turnover of 20% or more in the months of March, April and May 2020, provided that:
- They have up to 250 employees; or
- They have 250 or more employees, when they are private social security institutions or similar, or operate in closed sectors (Decree 2-A/2020) or in the aviation and tourism sectors.
Measures to mitigate corporate crisis situations
Resolution 71-A/2020, subsequently amended by Resolution 76-B/2020, approved several support measures for companies that have their activity freazed, their establishments closed or a 40% reduction in their turnover:
(i) Extraordinary support for employment contracts. This support consists of the payment by the State of 2/3 of the employee's gross remuneration, 70% of which is ensured by the Social Security and 30% by the employer. The support has a maximum amount of €1,905.
(ii) Extraordinary training plan. This support will be granted to each employee, depending on the hours of training, up to a limit of 50% of the gross remuneration, with a maximum limit of €635.
(iii) Exemption of employer social securiy contributions. Employers are exempted from paying social security contributions in respect of workers covered by measures (i) or (ii) above. Contributions in respect of the members of their statutory bodies will also be exempt. This exemption may also extend to self-employed workers who are employers benefiting from the measures above and their spouses and will be in force for the duration of the measures they benefit from.
(iv) Incentive to support the normalization of the company's activity. Employers are entitled to receive €635 for each employee covered by the measures referred to in (i) or (ii) above.
Other support/incentives
Support for employees
An exceptional financial support in an amount equal to 66% of the basic remuneration (33% to be paid by the employer, 33% to be paid by the Social Security) will be granted to employees who need to be away from work due to unavoidable assistance to a minor under 12 years of age or a dependent, resulting from the closure of an educational establishment, early childhood support or disability, with a minimum limit of €635 and a maximum limit of €1.905, calculated according to the number of days of absence from work.
Portugal 2020 Program - Deductibility of expenses
Within the scope of the projects approved by the Portugal 2020 program, expenses incurred by beneficiaries in initiatives or actions cancelled or postponed for reasons related to COVID-19 will be deductible.
Suspension of tax and social security debt enforcement proceedings
The enforcement proceedings relating to tax and social security debts are suspended until 30 June 2020, as well as the installment plans, without prejudice to the possibility of their fulfillment.
On 26 March 2020, the Portuguese Government passed Decree-Law 10-J/2020, which approves exceptional measures to protect families, companies, private charitable institutions and social economy entities in connection with the Covid-19 crisis, including a moratorium on credits.
In this newsletter, we describe the main conditions for the application of the moratorium.
Protection measures:
- Prohibition of the cancellation, in whole or in part, of credit facilities and loans;
- In relation to bullet loans, extension of the maturity as well as of any ancillary obligations, including interest;
- In relation to other loans, suspension of payment of instalments, rents and interest and automatic extension of the payments schedule.
Moratorium period:
Until 30 September 2020.
Eligible entities / persons:
- Companies that:
(i) have their head office and perform their economic activity in Portugal;
(ii) are classified as micro, small or medium-sized enterprises;
(iii) as of 18 March 2020, were not in default of cash payments towards financial institutions for more than 90 days or, if they were, did not meet the materiality threshold established in the Bank of Portugal Notice 2/2019 and Regulation (EU) 2018/1845 of the European Central Bank of 21 November 2018;
(iv) as of 18 March 2020, were not in an insolvency, suspension or cessation of payments situation or subject to an enforcement proceeding; and
(v) are not in default towards the Tax Authority and Social Security.
- Other companies, regardless of their size, who meet conditions (i), (iii), (iv) and (v) above, excluding those of the finance sector;
- Individual entrepreneurs, private charitable institutions, non-profit organisations and certain social economy entities who have their domicile or head office in Portugal and fulfil the conditions (iii), (iv) and (v) above;
- Natural persons, in relation to primary residence mortgage loans only, who reside in Portugal, fulfil the conditions (iii), (iv) and (v) above and fall in one of the following circumstances:
(i) prophylactic isolation or disease situation;
(ii) assistance to children or grandchildren;
(iii) reduction of normal working period or suspension of the employment agreement due to business crisis;
(iv) unemployment situation registered with IEFP;
(v) are eligible for the extraordinary support for the reduction of the economic activity of self-employed workers under Decree-Law 10-A/2020, of 13 March 2020;
(vi) are employees of entities whose establishment or activity has been closed or suspended during the state of emergency period pursuant to Decree 2-A/2020, of March 2020.
Eligible transactions:
Credit transactions carried out by:
- Credit institutions;
- Financial credit companies;
- Investment companies;
- Leasing companies;
- Factoring companies;
- Mutual guarantee companies;
- Branches of credit and financial institutions operating in Portugal.
Excluded transactions:
- Credits or financing for the purchase of securities or the acquisition of stakes in other financial instruments;
- Credits granted to beneficiaries of schemes, subsidies or benefits (e.g. tax benefits) to establish their head office or residence in Portugal, including for investment activities, with the exception of citizens covered by the Return Programme (Programa Regressar); and
- Credits granted to companies for the individual use of credit cards by members of board, supervisory bodies, employees or other workers.
Interest capitalisation:
The extension of the payment of principal, rents, interest, fees and other charges (where applicable) will not prevent the accrual of interest which shall be capitalised in the value of the loan.
Moratorium application:
The moratorium must be requested before the relevant financial institution. The eligible entities and persons may request the suspension of the repayment of principal only (or a part thereof).
Today, the Portuguese Energy Secretary of State announced in an online session that the first 2020 solar auction will be, on the whole, similar to the 2019 solar auction. Despite the announcement, there is no date for the auction’s launch, due to the Covid-19 pandemic’s effects on the market.
The injection capacity to be auctioned will be of 700 MW, all in the Alentejo and Algarve areas.
The promoters may apply to the following remuneration schemes:
- a market scheme without storage where the promoters bid for a contribution made to the National Electric System (“SEN”), in €/MWh. The Promoters available to pay larger contributions will be awarded with the capacity title;
- a fixed guaranteed tariff structure, where the bids will express a discount to the reference feed, to be announced (in 2019, was 45€/MWh);
- a market scheme for power plants incorporating a storage system. A value of an annual payment to be made to SEN, in MW, will be announced and the promoters interested in this new option offer a discount to this value.
The obligations for the awarded bids in the auction will be similar to those of the 2019 solar auction and they include a performance bond (60.000€/MWh) to guarantee the compliance with a tight schedule to connect the plant to the grid.
A few days ago the Portuguese government also enacted Decree 80/2020, of 25 March initiating the simplified licensing for small production units (up to 1 MW). Through this proceeding, the Promoters may apply for a guaranteed remuneration for 15 years. On a monthly basis, until offering a total of 20 MW, the Portuguese Energy Authority (“DGEG”) will organize sessions where the Promoters bid among themselves. The Promoters will offer a discount to the reference feed (45 MW/h). The first session is scheduled to June of 2020, however due to the Covid-19 pandemic’ effects, there is some uncertainty regarding this date.