Open a Business in Portugal
Portugal offers a well-developed business climate, with a good infrastructure and competitive labour and business costs, it has a highly skilled young work force, which normally converse in various languages.
There are two main types of business entities commonly used by foreign investors, these, include the private limited liability company (Lda) and the public limited corporation (SA). The Lda suited to small or medium size startups.
The Lda can be incorporated with a single director and shareholder, the shareholder can chose the nominal share capital from as low as 1 EUR.
The SA has a minimum share capital requirement of (50,000 EUR), hence, this entity is used for larger projects and globally placed companies.
Both of these entities can be incorporated by Proxy, so that the shareholders don’t have to physical travel to Portugal.
The incorporation process generally starts by doing a name check, name application of the specific company name chosen by the client. Some clients opt for the names in a pre-approved list of names.
The selecting a name from the list will be reserved when the founder starts the process to register the company.
Starting a new company and new business in a foreign country can be very challenging, we are here to assist the client in every step, from initial start up to offering back office functions, preparing a business plan, introducing the clients to the banks and all other relevant authorities
With us, your firm benefits from the “one stop shop” concept, where the client concentrate on their business idea and we take care of the administrative matters.
The steps for opening a company in Portugal
Portugal offers a simplified one-stop-shop for opening a company that only includes a few basic steps: searching the database for the available name, registering via the online portal and depositing the capital. The one-stop-shop offers and instant registration if investors choose to do this via the several locations available throughout the country (Loja da Empresa). An alternative is to perform an online setup.
The steps below are the general, traditional ones for opening a company in Portugal:
companies in Portugal are required to have original names and the first step is to obtain a name approval certificate (the application can be made online or in person at the National Register of Legal Entities)
this is done once a bank account is opened for the company in Portugal and must comply with the minimum amounts as per the chosen type of company
the Lda or the SA must have their Articles of Association drawn up. The signatures of the company founders need to be certified in the presence of a notary public. Foreign investors who wish to assign one of our lawyers in Portugal to handle the procedures that can be performed through a power of attorney can reach us and make an inquiry.
once the constitutive documents are in order, the company founders can submit the complete set of documents to the National Registry of Corporations.
The necessary documents for company formation in Portugal
When the company is set up by a legal person, there must be submitted a few documents and if you want to know which are these, you may reach out to our Portuguese lawyers.
After you pay the charges provided by the law, the articles of incorporation will be prepared and the registration form will be submitted to the Commercial Register. The members will receive an immediate certificate of association, the access code for a permanent certificate of commercial registration, the electronic access code, the enterprise card and the social enterprise security number.
The declaration of commencement of activity must be submitted in term of 15 days to the Financial Services Office and this document must be signed by a chartered accountant.
Within five working days after the constitution, the members are required to deposit the amount of capital (when held in cash) in an open account on behalf of the newly formed company.
Hiring employees in Portugal
After you set up your company and you want to hire employees, you must pay special attention to the law’s provisions in this field, as the relation between the employer and the employee is overseen by the Portuguese Labor Code in which are set the rules on wages, treaties, benefits, working days and other essential issues.
You may choose to hire an employee in Portugal for a fixed period or for a temporary period. For temporary period contracts, the minimum time cannot be less than six months and when you renew the temporary contract several times it automatically turns into a permanent employment contract.
The law establishes a minimum salary and this income is charged with taxes for both parties, for, example the social security contribution and taxes for the pension fund. The probation periods are also paid and there are probations that can last between 30 and 90 days.
In Portugal, the average working time is 40 hours per week, which means eight hours per day for five days. However, during the eight hour work, the employees have several breaks.
Investors who wish to open a business can explore the existing opportunities for starting a new company or franchising in some of the top business sectors.
The main economical sectors in Portugal are: textiles, clothing, footwear, wood and cork, paper, chemicals, metals, dairy products, wine and other foods, porcelain and ceramic products, glass, technological products and telecommunications, construction and maintenance of ships, tourism. The main export partners are Spain, Germany, France, Angola, UK, Netherlands and the U.S. A.