Company registration in Portugal
Not only tourists, but also entrepreneurs have started to show greater interest in Portugal over the past ten years. Being a EU member this country offers great opportunities for commerce and business development. All procedures along with bureaucratic process are minimized through the introduction of paperless registration system ‘Simplex’ and thanks to one window process of registration. If an entrepreneur processes articles of incorporation and by-laws in a required format, the whole process can be completed within one day. A simple and time-efficient way is available if all shareholders are present, but it is also allowed to operate through an official representative having the power of attorney.
Company formation in Portugal requires completing some actions before the company is ready to begin its activity. It is necessary for the owner of a newly registered company in Portugal to draft the articles of association and all other documents, such as passport copies, specimen signatures, and special forms. Some public notary procedures must also be taken care of, as well as finding a registered office for company registration in Portugal. An accountant and a bank account are mandatory for company formation in Portugal.
Types of business entities you can open in Portugal
In order to incorporate a small or medium business with a reduced amount of capital and a liability limited by the contribution to the capital, the investors are advised to form a private limited company (sociedade por quotas - LDA) in Portugal. The LDA must be established by at least two founders with a minimum share capital of EUR 5,000. All the shareholders must bring a contribution to the capital and their liability is limited to that contribution. The management is assured by a director appointed by the general meeting of the shareholders, the supreme authority in the Portuguese LDA.
If the founders have a high amount of capital, they can incorporate a public company (sociedade anónima - SA) which is a form of a large company created by investors who provide a minimum share capital of EUR 50,000. At least five shareholders are necessary to incorporate this type of business and their liability is limited to their contribution to the capital. In this type of Portuguese business, the management is assured by a board of directors which is monitored by a supervisory board, both invested by the general meeting of the shareholders.
A limited partnership in Portugal
The limited partnership (sociedade em comandita - SC) is formed by minimum two partners, at least one must be general and has full liability for the company’s obligations (socios comanditarias), while the other one will have limited liability and must deliver capital to the partnership (socios comanditados).
A general partnership in Portugal
A general partnership (sociedade em nome collectivo - SNC) also has two partners with full liabilities in the firm. They are equally responsible for making decisions in the name of the entity and can manage the company. No minimum share capital is necessary for this type of business.
An EIRL in Portugal
Another form of business established with no requirements for share capital is the company with a single shareholder (EIRL). The founder of such company is liable with his personal assets for the entity’s debts.
Opening an LDA in Portugal
Foreign investors who want to register a limited liability company in Portugal, known as LDA, the most popular business structure in Portugal, need to provide a minimum share capital of EUR 5,000 in a bank account opened in this country. Such type of business can be opened by at least one shareholder in Portugal, without the obligation of having a board of managers in the firm.
How to start business in Portugal?
It is advisable to decide in favor of a limited liability company, as this type of business provides broad possibilities together with minimal personal obligations in case of bankruptcy. Besides, by means of a newly formed company a non-resident has an opportunity to acquire land in Portugal. Consequently, businessmen often invest into immovable property in a potential EU member country.
Setting up a company by non-residents is a common practice in Portugal, but only residents are allowed to start business in areas close to the country's border, on the territory of a national park and in the field of manufacture and sales of weapons.
Steps in opening a company in Portugal
Public and private limited liability companies can be easily set up in Portugal, following these steps:
1. Verify the business name and make a reservation with the Portuguese Trade Register.
2. Appoint a legal representative for your company in Portugal.
3. Draft the Articles of Association with information about the owners, business activities, etc.
4. Open a bank account for depositing the minimum share capital of EUR 5,000.
5. Apply for licenses and permits in accordance with the company’s activities.
6. Register for tax purposes and social contributions in Portugal.
All companies are obliged to submit a notice of commencement, to get a tax identification number, to appoint a director and to specify authorities. Registration of a company in Portugal shall be accompanied by the following documents:
1. information about owners and directors of a company; copies of passports, tax identification number, contact details (telephone number, address), marriage certificate, registration certificates (in case of a legal entity);
2. documentation on the company; certificate of good standing, memorandums and regulations, confirmation of address and a name of a company, stock and activity information, expected export and import operations;
3. information about charter capital and gained intellectual property (trademarks, copyright.
In accordance with the norms, if a company needs a fiscal representative, it is necessary to present an identification document. The whole set of documents should be apostilled and translated into Portuguese or composed in this language. After the registration it is necessary to open a bank account.
Please do not hesitate to contact our specialists in Soha Europe Invest for more information regarding Company Registration in Portugal.