Portugal Forum

A few decades ago, setting up a business in Portugal was a very stressful and time-consuming affair. This was then recognized by the leaders of the country as one of the main causes for the slow growth of the business sector. In response, new laws were instituted to make the process of setting up a business more simplified. Barring any difficulties and issues, you can have your business registered and set-up in a single day. Here is the overview of the process of setting up a business in Portugal.

Who can set up a business in Portugal? Portuguese citizens can set-up a business while foreign nationals can set-up a business through the facilitation and assistance of a Portuguese lawyer, solicitor or notary duly holding a certificate that allows them to do this kind of business. There are no restrictions for foreigners to set up a company in Portugal so long as they apply for legal residence and obtain the necessary work permits and the infusion of the minimum capital investment for the company.

Here are the required certifications for foreigners to be able to set up their business in Portugal. These particular requirements are strictly observed and this is where assistance of a professional becomes critical to the success of your planned business:

• They must obtain a Residency Card or Cartao de Residencia that has been duly issued by the Portuguese Immigration Service or a Servicios se Estrangeiros e Fronteiras or work permit.
• They also need to obtain a Tax Number or a Numero Fiscal de Contribuinte be it for the establishment of a business or those intending for work. This identifies the individual for tax purposes.
• The individual should also register to obtain a Social Security Number or a Cartao de Seguranca Social. As a mandatory requirement, foreigners working in Portugal for more than a hundred eighty days need to pay their share for social security.
• You also need to determine the type of company you would be setting up in Portugal. The following are four types of companies that can be established.

1. Private limited liability companies, or Sociedade por Quotas require at least two individuals as partners to its establishment.Sole proprietorships or Sociedade Unipessoal por Quotas have an individual owner, either as one person or as a collective entity. The corporate entity is liable solely for the liabilities. The minimum capital investment for these kinds of companies are €5,000.
2. Public limited companies or Sociedade Anonima SA Corporation requires at least five individual shareholders. If one of the shareholders is the State, then only two other shareholders are needed. The corporate entity is liable for the company liabilities.
3. Limited co-partnership companies or Sociedade em Comandito SC are special kinds of companies. There are two categories of partners in the corporation, the dormant partners or socios comanditarias and the full partners or socios comanditados. The dormant partners liability is limited to the amount of their shares. The full partners are fully liable for any and all of the company debts.
4. General partnership companies or Sociedade em Nome Collectivo SNC partners are liable for any and all of the company’s debts.

There are many companies that offer professional advice and help in putting up a business. These entities include the local Municipal Councils, local Citizen’s Shops or Loja do Cidadao and the local employment services. Some other modern towns and cities have Business Formality Centers or Centros de Formalidades das Empresas or CFE. These specialized offices are designed to assist the setting up of the business. They provide entrepreneurs the documents required for submission, provide organizational management advice, process orientation and other information on government bodies to assist in its establishment.

You can opt to hire a professional or a Portuguese business broker known as a Despachente. This individual or individuals are well versed in administrative procedure. It is also necessary to engage the services of an accountant or Contabilista and a lawyer or Advogado. Another important item to have when putting up your business is a Conta Bancaria or a business bank account as well as individuals designated who can sign and issue checks.

Individuals choosing to put up a business need to choose a name for their business. The proposed names can be checked against a database of company names. The name, if it is available, can be registered with a validation certificate or Certificade de Admissibilidade issued by the Registo Nacional de Pessoas Colectivas or the National Registry of Companies.

Setting Up a Business in a Nutshell

The basic steps in putting up a business in Portugal are as follows:

• Entrepreneur applies for a Validation Certificate or Certificado de Admissibilidade for the issuance of a Provisional Company Identity Card or Cartao Provisorio de Pessoa Collectiva from the Registo Nacional de Pessoas Colectivas or RNPC.
• The Deed of Incorporation is prepared and signed at a notary public.
• An application for a Start of Activity Declaration or Declaracao de Inicio de Actividade para Efeitos Fiscais at the Tax Office or Direccao-Geral dos Impostos. This application needs to be filed within 90 days after issuance of the Provincial Company Identity Card.
• The Conservatorias do Registo Comercial or the local Commercial Registry is the next office to go to as one applies for the registration of the company. The registry will then organize the company’s publication in the Portuguese Official Journal or Diario da Republica.
• Another office that needs to be dealt with local Social Security center as the employees need to be registered and the company needs to pay its share in social welfare.
• The owners also need to register the company within thirty days with the Commercial or Industrial Records Office or the Cadastro Comercial or Industrial at the Directorate-General of Enterprise or the office of the Ministry of Economy.

This simplified process has made setting up a business in Portugal much easier. This has helped foster the current economic growth in Portugal. Now, you should not have any other problems when you want to earn a profit in Portugal since this registering a business is now just a breeze.