PORTUGAL Law and Practice Contributed by: João Nóbrega, Bernardo Marques and Francisco Miguel Gomes, EY Law – Sociedade de Advogados, SP, S.A.
investors to authorised distributors; however, these agents are not permitted to market, promote or place fund units. Overall, retail participation in AIFs remains limited, and the CMVM exercises strict oversight over marketing practices, investor qualification and disclosure. 4.6 Private Placements In Portugal, sponsors must exercise caution when relying on private placement or reverse solicitation, as the marketing regime for AIFs is significantly more restrictive than in other jurisdictions. Under the RGA and RRGA, any communication or marketing activity related to AIFs requires prior noti - fication or authorisation from the CMVM. There is no general private-placement exemption comparable to US Rule 506 (c). Private placement of AIFs is limited to professional and semi-professional investors and must be con - ducted without any public solicitation or advertising. Any general promotion – through websites, media or events – would requalify the offer as a public offering, necessitating the CMVM’s approval process. Reverse solicitation – ie, where an investor approach - es the AIFM entirely on their own initiative – is recog - nised in principle but interpreted very narrowly. The AIFM must demonstrate that no prior marketing or solicitation occurred in Portugal and that the inves - tor’s initiative was fully spontaneous and documented. Any contact through third-party introducers or online promotions accessible in Portugal would undermine this reliance. Sponsors should therefore ensure that all communica - tions remain strictly targeted and private, and maintain comprehensive records to demonstrate compliance with the CMVM’s conservative approach to private placement and reverse solicitation. 4.7 Compensation and Placement Agents The use of placement agents in Portugal is relatively common, particularly for cross-border offerings of AIFs. Such intermediaries must be authorised financial
institutions – typically credit institutions, investment firms or other CMVM-registered intermediaries – and must operate under written distribution or placement agreements with the AIFM. The AIFM remains fully responsible for all marketing and investor communica - tions conducted on its behalf. AIFMs may also utilise internal distribution teams or tied agents, provided that these individuals are prop - erly registered and comply with MiFID II conduct-of- business rules. Personnel involved in sales or distribution may receive remuneration for placement activities, as long as such compensation aligns with the AIFM’s remuneration policy under the RGA and ESMA Guidelines. These policies must ensure that incentives are aligned with sound risk management, avoid conflicts of interest and guarantee fair treatment of investors. The CMVM expects these arrangements to be documented, pro - portionate and subject to internal compliance over - sight. 4.8 Tax Regime for Investors The taxation of investors in Portuguese AIFs depends on the nature (individual or corporate) and residence of the investor, as well as on the type of AIF. • Real Estate AIFs: Income distributed by real estate AIFs to resident individuals is subject to a 28% final withholding tax; capital gains real - ised on redemption or sale are taxed at the same rate when earned outside a business activity. For resident legal entities, income is subject to 25% withholding tax (WHT) (as a payment on account) and included in taxable profit, subject to 20% CIT. For non-residents, distributions and capital gains are generally subject to a final 10% WHT, except where the investor is domiciled in a blacklisted jurisdiction (35% on dividends, 25% on capital gains) or is held more than 25% by Portuguese residents. These rules reflect the “income from immovable property” principle under the OECD Model Tax Convention, preserving Portugal’s taxing rights. • Private Equity and Credit AIFs: Income distributed to resident individual investors is subject to a 10% final WHT, and to 20% CIT for resident corpo -
265 CHAMBERS.COM
Powered by FlippingBook