PORTUGAL Law and Practice Contributed by: João G Gil Figueira, Rodrigue Devillet Lima and Catarina Andrade Miranda, GFDL Advogados
2.15 Financial Action Task Force Standards
under this model will also be subject to MiFID II rules. Fintech companies looking to deploy robo- advisers that trade both financial instruments and virtual assets will need to obtain a hybrid license. In Portugal, the Bank of Portugal is the competent authority responsible for authoris - ing activities related to the custody of virtual assets. The Comissão do Mercado de Valores Mobiliários (CMVM) regulates activities involving security tokens. While the compliance require - ments for different asset classes may have some similarities, distinct regulatory frameworks will apply based on the specific nature of the assets involved. 3.2 Legacy Players’ Implementation of Solutions Introduced by Robo-Advisers Legacy players such as banks and fund man - agement institutions have been paying close attention to robo-advisers. New solutions are expected to be developed in the future, con - sidering the advantages they bring from a mass investment perspective and the ability to capture many retail investors. In Portugal, Best Bank is one of the retail banks offering a robo-adviser- based solution for investment in financial instru - ments. Open Bank, another retail bank, offers a digital investment service that provides person - alised investment advice and portfolio manage - ment. 3.3 Issues Relating to Best Execution of Customer Trades In the event that robo-adviser services fall under the scope of MiFID II, “best execution” obliga - tions require participants to take all sufficient steps to obtain the best possible result for cli - ents.
Portugal’s AML framework, including Law No 83/2017 of 18 August, complies with FATF standards and requirements. As a member of FATF since 1991, Portugal enforces measures such as customer due diligence, transaction monitoring, and reporting of suspicious activi - ties, aligning with FATF recommendations and EU regulations. 2.16 Reverse Solicitation In accordance with Recitals 85 and 111 and Arti - cle 42 of MiFID II, as well as Article 314-D of the Portuguese Securities Code, Portugal allows the provision of regulated products and services from another jurisdiction under a reverse solici - tation basis. This can be done without estab - lishing a branch or obtaining authorisation from the CMVM, as long as the service is provided solely at the client’s initiative. The arrangement must not involve solicitation, promotion aimed at specific client categories, or targeted advertis - ing encouraging particular investors to acquire a specific investment, with or without ancillary services. 3. Robo-Advisers 3.1 Requirement for Different Business Models There is no specific law regulating the services provided by robo-advisers. Therefore, they are likely considered to fall under the definition of order execution, investment advisory services or portfolio management. Usually, robo-advis - ers are used for trading in traditional securities, such as shares, bonds, exchange-traded funds, and other financial instruments regulated under the Portuguese Securities Code and other ordi - nances issued by the CMVM. Fintechs operating
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