PORTUGAL Law and Practice Contributed by: Duarte Schmidt Lino, Raquel Azevedo, Alexander Ehlert and Leonor Melo Bento, PLMJ
7.6 Labour Law Regulations In the case of a transfer of undertaking, the employment contracts are automatically trans- ferred to the new employer by operation of law. The transferor and the acquirer must inform the employees’ representative body and the employees covered by the transfer, in writing, of: • the date, reasons and consequences of the transfer for the employees; and • the measures to be taken (if any) concerning the employees. They must also begin a consultation period with the employees’ representative body to reach an agreement on the measures to be applied to the employees as a result of the transfer. The infor- mation and consultation process should be initi- ated in advance of the transfer, but the employ- ees’ representative body opinion is not binding on the employer. However, the consultation must be conducted in good faith, and the employees’ representative body input should be considered in the decision-making process. If there are no measures to be applied due to the transfer, then the consultation stage may not take place. The information and consultation process must be documented and shared with relevant par- ties, including employees, even if no agreement is reached on the measures affecting employees due to the transfer. The acquirer will be responsible for all employ- ment obligations and liabilities that arose prior to the transfer date. Employees covered by the transfer are entitled to maintain their existing employment contracts with the same terms and conditions under the new employer. Employees have the right to oppose the transfer of their employment contracts where they have
reasonable grounds to believe that the transfer could cause them serious harm. In the event of a share deal, employees remain employed by the same legal entity (the company being acquired). 7.7 Currency Control/Central Bank Approval No currency control regulation or central bank approval applies for an M&A transaction, except when it comes to financial regulated entities. 8. Recent Legal Developments 8.1 Significant Court Decisions or Legal Developments Litigation in M&A and technology mainly takes place before arbitral tribunals, and as arbitral decisions are not made public, there are no sig- nificant public court decisions relating to tech- nology M&A. 9. Due Diligence/Data Privacy 9.1 Technology Company Due Diligence When providing information regarding technol- ogy companies, it is important to determine whether the company has certain statutory or compliance rules in place (eg, ISO 27001 certifi- cation) which may prevent disclosure of specific information to external parties. From a capital markets perspective, the same level of information must be provided to all bidders. Moreover, the Market Abuse Regula- tion applies, and therefore no inside informa- tion should, in principle, be shared with bidders (some exceptions may apply). Inside information
consists of information that: • has not been made public;
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