PORTUGAL Law and Practice Contributed by: Pedro Cassiano Santos, Francisca César Machado, Chen Chen and Natalia Fedorova, VdA
respect to deposits collected by their branches in Portugal, unless these deposits are covered by a guarantee system in their country of origin which Banco de Portugal considers equivalent to the Portuguese Deposit Guarantee Scheme, particularly regarding the scope of coverage and the guarantee limit, and without prejudice to any existing bilateral agreements on the matter. The Portuguese Deposit Guarantee Scheme ensures the reimbursement of: (i) deposits made in Portugal or in other member states of the European Union with credit institutions headquartered in Portugal; and (ii) deposits made in Portugal with branches of credit insti - tutions headquartered in countries that are not members of the European Union, regarding the deposits collected by their branches in Portu - gal. The maximum limit is EUR100,000 per credit institution, in relation to the overall balance in cash of each deposit holder. Finally, the Portuguese Deposit Guarantee Scheme does not guarantee the reimbursement of: (i) deposits made in the name and on behalf of credit institutions, investment firms, financial institutions, insurance and reinsurance compa - nies, collective investment undertakings, pen - sion funds, entities of the national and foreign public administrative sector, and supranational or international organisations, with the exception of deposits from pension funds whose members are small or medium-sized enterprises, and deposits from local authorities with an annual budget equal to or less than EUR500,000; (ii) deposits resulting from operations for which a final criminal conviction for money laundering has been handed down; (iii) deposits whose holder has not been identified in accordance with the Portuguese Anti-Money Laundering and Counter-Terrorist Financing Law, as of the date on which the unavailability of the depos -
its is determined; and (iv) deposits of persons and entities that, in the two years preceding the date on which the unavailability of deposits is determined or a resolution measure has been adopted, have had a direct or indirect holding equal to or greater than 2% of the share capital of the credit institution in question or have been members of its management bodies, unless it is demonstrated that they were not, by action or omission, the cause of the financial difficul - ties faced by the credit institution and that they did not contribute, by action or omission, to the aggravation of such situation. 7. Prudential Regime 7.1 Capital, Liquidity and Related Risk Control Requirements Legal Regime The principal legislation on capital, liquidity, and related risk control requirements is the Legal Framework of Credit Institutions and Financial Companies (which implemented in Portugal the Capital Requirements Directive IV (CRD IV) – Directive 2013/36/EU of the European Parlia - ment and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, and the Capital Require - ments Regulation (CRR) – Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential require - ments for credit institutions and investment firms). The rules provided for in CRR and CRD IV rep - resent the adoption of Basel III standards, which were established to improve the banking sector’s ability to withstand shocks arising from adverse economic and financial scenarios.
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