PORTUGAL LAW AND PRACTICE Contributed by: Joana Torres Fernandes, José Manuel Pereira da Costa, Danielle Avidago, Javier Mateo, António Pratas Nunes, Joana Loureiro Veríssimo, Madalena Mourão and David Serras Pereira, LVP Advogados
The government has 30 working days from the signing of the deal (or its public disclosure) to initiate an evalu - ation. During this period, the authorities may request any information or documentation deemed necessary from the involved parties and other public bodies. If an evaluation is opened, the government has 60 days to decide. Absence of a decision within this timeframe acts as a “tacit approval.” If the government opposes the deal, all legal acts related to the transaction are deemed null and void. The screening rules are focused on sectors critical to the national interest, such as energy, transportation and communications. In addition to this general screening, specific indus - tries like banking and insurance require prior authori - sation from their respective regulators (Bank of Por - tugal and ASF) regardless of the investor’s nationality. Furthermore, in addition to national law, foreign invest - ments in Portugal are also governed by European Union regulations that impose specific restrictions within the single market. Notably, Regulation (EU) 2019/452 establishes a framework for the screening of foreign direct investments on grounds of security or public order, while the Foreign Subsidies Regulation (FSR) addresses distortions caused by non-EU subsi - dies. These European instruments are applicable and operate alongside domestic legislation, creating an additional layer of scrutiny that significantly impacts how foreign capital enters and operates within the Portuguese jurisdiction. 2.2 Procedure to Obtain Approval and Sanctions for Non-Compliance Investors may either wait for an ex-officio evaluation from the government as outlined in 2.1 Approval of Foreign Investments or proactively seek prior con - firmation. In this case, investors can request a “safe harbour” confirmation, which is granted if the govern - ment fails to initiate an evaluation within 30 days of the request. The consequences of proceeding with an investment that is subsequently vetoed are severe, given that a decision of opposition renders all related legal acts and transactions null and void, stripping them of any
legal effect. This sanction is extensive, as it prohibits the economic exploitation of the assets and prevents the investor from exercising any corporate or voting rights over the strategic entities involved, effectively neutralising the investment. 2.3 Commitments Required From Foreign Investors The legal framework does not explicitly provide a formal mechanism to bypass an opposition decision through negotiated commitments or mitigation agree - ments that provide a precise timeline. As a result, the government either opposes the transaction or allows it to proceed. However, any approved investment is inherently bound by the operational and regulatory requirements already applicable to all market participants. Espe - cially in highly regulated strategic sectors, investors must comply with strict conduct standards and public service obligations overseen by sectoral regulators, ensuring that the investment remains aligned with the national interest regardless of the absence of specific The entity affected by a decision of opposition may challenge its legality by filing an appeal before the Por - tuguese administrative courts. While the law grants this right of judicial review, providing a precise timeline for a final ruling is difficult. However, it is widely recog - nised that Portuguese administrative courts are gen - erally subject to significant delays, often resulting in lengthy litigation periods that may span several years. 3. Corporate Vehicles 3.1 Most Common Forms of Legal Entity In Portugal, the most common corporate vehicles are private limited liability companies (eg, sociedades por quotas , Lda) and public limited companies (eg, socie- dades anónimas , SA). ad hoc commitments. 2.4 Right to Appeal A private limited liability company (Lda) is the most widely used structure for small and medium-sized businesses. It requires at least one shareholder, with
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