PORTUGAL Law and Practice Contributed by: Pedro Cassiano Santos, Francisca César Machado, Chen Chen and Natalia Fedorova, VdA
6. Depositor Protection 6.1 Deposit Guarantee Scheme (DGS) The Legal Framework of Credit Institutions and Financial Companies establishes the legal rules applicable to the Portuguese Deposit Guarantee Scheme ( Fundo de Garantia de Depósitos ). The Portuguese Deposit Guarantee Scheme is a legal entity of public law, endowed with adminis - trative and financial autonomy, and with its own assets. Its purpose is to ensure the reimburse - ment of deposits made into participating credit institutions. This is only possible through its financial resources (in addition to complemen - tary financial resources), which are made up of: (i) initial contributions from participating credit institutions; (ii) periodic contributions from par - ticipating credit institutions; (iii) income from the application of resources; (iv) donations; and (v) any other revenues, income or amounts arising from a credit institution’s activity or assigned to it by law or contract, including the proceeds of fines imposed on credit institutions. The Portuguese Deposit Guarantee Scheme is managed by a steering committee composed of three members. The chairperson is a mem - ber of the Board of Directors of Banco de Por - tugal, designated by it. The second member is appointed by and in representation of the Min - istry of Finance. The third member is designated by the association representing, in Portugal, the participating credit institutions that collectively hold the largest volume of guaranteed deposits. The following entities are mandatory participants in the Portuguese Deposit Guarantee Scheme: (i) credit institutions headquartered in Portugal that are authorised to receive deposits; and (ii) cred - it institutions headquartered in countries that are not members of the European Union, with
whether they come from a sanctioned country, are a politically exposed person (PEP), or are individuals closely associated with a PEP. The obligation of reporting requires obliged enti - ties to immediately inform, on their own initia- tive, the Central Department of Investigation and Criminal Action of the Attorney General’s Office ( Departamento Central de Investigação e Ação Penal – DCIAP) and the Financial Intelligence Unit whenever they know, suspect, or have rea - sonable grounds to suspect that certain funds or other assets, regardless of the amount or value involved, originate from criminal activities or are related to terrorist financing. Obliged entities shall implement internal organi - sational structures and procedures informed by risk assessments, particularly regarding expo - sure to money laundering risks based on the services offered and the origin or destination country of the funds. In this respect, obliged entities must observe Banco de Portugal Notice No 1/2022, of 6 June, and Notice No 1/2023, of 24 January (the latter regarding virtual assets), along with the Euro - pean Banking Authority’s Guidelines under Arti - cles 17 and 18(4) of Directive (EU) 2015/849 on customer due diligence and the factors credit and financial institutions should consider when assessing the money laundering and terrorist financing risk associated with individual busi - ness relationships and occasional transactions, repealing and replacing Guidelines JC/2017/37 of 1 March 2021, and the Financial Action Task Force Recommendations, last updated in November 2023.
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