Foreign investors in Portugal who want to set up companies in this country need to respect the legislation in this sense. The Company Act stipulates the rules and regulations for company formation, the types of companies and the activities these can register in Portugal. For a better understanding of how companies can be formed in Portugal in agreement with the applicable laws, we invite you to get in touch with our team of company formation agents in Portugal.
What companies fall under the provisions of the Company Act in Portugal?
The Company Act in Portugal is based on the Portuguese Commercial Code, Decree-Law 262/86 released on September 2nd, 1986. All companies in Portugal fall under the regulations of the above-mentioned law. It is needless to say that for companies with the head office in Portugal, the rules apply according to Company Act, while companies that activate in Portugal, but have their head office abroad, are only subject to Company Law after one year of commercial activity.
The Company Act in Portugal mentions several types of companies. Private limited companies, public companies, general and limited partnerships, as well as companies with a single shareholder, each of them with the specific requirements and regulations regarding structure and organization.
How can companies perform activities in Portugal?
Companies from abroad which want to settle their operations in Portugal for more than one year need to have permanent establishments in this country and respect the regulations of the Company Act. These firms need to be represented by an appointed agent with residency in Portugal.
If you are a foreign entrepreneur and want to open a business in Portugal, we recommend the specialized services of our accountants in Portugal. They can take care of a number of important aspects, and including bookkeeping, payroll, preparation, and submission of annual financial statements. They can also take care of the registration for the payment of taxes, so you benefit from all the support offered in this matter.
What stands at the base of company formation in Portugal?
The Articles of Association are the company’s main documents which contain information about the name of the business, the type of firm, the activities, the purposes, the business address, the liabilities of the partners involved and details about the capital contribution of each member. Also, the Articles of Association need to contain information about how such firm can be closed.
What is the duration of a company in accordance with the Company Act in Portugal?
Any type of company with establishments in Portugal has an indefinite duration if there are no mentions regarding the company liquidation at a certain time. If the Articles of Association comprise information about the fixed duration of the firm, then a resolution in this sense will be signed by partners before the termination date. We are at your disposal with complete support for company incorporation in Portugal.
Provisions regarding the employment procedures in Portugal
The Company Act in Portugal goes hand in hand with the Labour Law. The Labour Code amended by the Law 7/2009 is responsible for every aspect regarding employment issues. It is mandatory to write and sign an employment contract only for determined period contracts. Responsibilities and rights are mentioned in the Labour Code for both employers and employees, as well as certain specifications on their professional relationship. Foreign employees in Portugal must obtain a work permit and afterward, they have the same rights as Portuguese nationals.
All entrepreneurs who set up a company in Portugal must be aware of the regulations of the Company Act in Portugal, even foreign investors. This way, it will be easier to observe the rules and keep the company’s activities legal.
For more details regarding the Company Act, please feel free to contact our company formation specialists in Portugal.