What is the main source of law authorising this entity form?

Commercial Companies Code (Código das Sociedades Comerciais).

Securities Code (Código dos Valores Mobiliários).

Give a brief summary of the entity form:

Does the entity possess separate legal personality?

The Company has a separate legal personality;

(Maximum) period of existence

There is no maximum period of existence unless otherwise stated under the Company's Articles of Association (Estatutos da Sociedade);

Governing document(s)

The Company is governed by its Articles of Association [contained in the Company's incorporation documentation or subsequent amendment through Shareholders' resolution (Deliberação dos Acionistas)];

Liability of incorporators / shareholders

Shareholders are not personally liable for the debts of the Company, except for the subscription amount related to their own shares;

(Governing) bodies

Generally, there are alternative governing structures:

• Board of Directors (Conselho de Administração) (or sole director (Administrador Único) if the share capital does not exceed €200,000) and an Audit Board (l) (or Sole Auditor) (Fiscal Unico);
• Board of Directors (including an Audit Commission) and an Auditor (Revisor Oficial de Contas – ROC); and
• Executive Board of Directors (or sole director if the share capital does not exceed €200,000) and a General and Supervisory Board and an Auditor.

Other particularities

Can this type of entity be involved in international transactions and restructurings (e.g. cross border mergers, asset acquisitions and divestitures, equity acquisitions, conversions etc.)?

Under Portuguese Law, corporations may enter into legal mergers (whereby another company is merged into the Company or the Company is itself merged into another company and ceases to exist by operation of Law and its assets are acquired under universal succession of title), legal spin-off of all or part of its assets (with universal succession of title of the relevant assets) and conversions (changing into another form of legal entity without ceasing to exist).

International mergers are possible pursuant to EU legislation.

Can this type of entity be publicly listed or held, or its securities be issued to members of the public?

Yes, Corporations may be listed on a stock exchange market.

Can this type of entity be used for a non-profit or charitable organization?

No, given its nature of a commercial entity, with the ability and purpose to generate and distribute profit to its shareholders, and being subject to corporate income tax.

Give a brief summary of the process of incorporation, formation, or organization, including:

Main documents required

Main Documents:

• Company's name certificate issued by the Companies Registry (Conservatória do Registo Comercial);
• Articles of Association;
• Incorporation Agreement (Contrato de Sociedade); and
• Documents for the registration of corporate bodies' members, notably the declaration of acceptance of appointment of each member of the Board of Directors, and ultimate beneficiary owner identification..

Involvement of notary, company register, governmental authorities

The Incorporation agreement is signed by the founding shareholders whose signatures must be certified by a notary or lawyer and all incorporation documents filed with the Commercial Registry (Registo Comercial) for due registration and with the Tax Department and Social Security Office (Autoridade Tributária e Aduaneira e Segurança Social).

Timing (estimate)

The rule set forth in the Commercial Registry Code is that registration must be carried out within 10 (ten) days from the filing of the registration application, unless an urgent registration is requested by the applicant, in which case the registration must be completed within a maximum of 1 (one) business day. In practice, however, the response time may vary significantly depending on the operational capacity of the registry offices at any given time.

Main costs, including registration and similar fees (excluding legal fees)

Main costs are the registration costs and lawyers' fees; and

Is a description of the anticipated business or purpose of the entity required for incorporation, formation or organization?

Yes, the business purpose must be specified under the Company's Articles of Association.

Minimum number of incorporators / shareholders and residency requirements

There must be at least five (5) shareholders (local residents or not) or just one (1) Shareholder if the Corporation is initially incorporated by a company as the sole shareholder.

Minimum number of directors (or other applicable officers) and residency requirements

There must be at least two (2) appointed members of the Board of Directors at the time of incorporation or a Sole Director, when permitted by Law.

Portuguese law does not establish any residency requirements, but residency is relevant for tax purposes and all members of corporate bodies must obtain their own Portuguese taxpayer number. In that sense, if the appointed director resides abroad, it is always necessary to obtain a Portuguese taxpayer number. Additionally, if the country of residence is outside the European Union, the appointment of a tax representative of the director in Portugal will also be required.

Minimum share capital, or equivalent, and payment requirements (including opening a bank account)

The minimum share capital of a corporation is €50,000. The payment of 70% of share capital paid in cash may be postponed for a five (5) year's period.

Is the physical presence of incorporators/directors/shareholders required in the jurisdiction for incorporation, formation, or organisation?

Incorporation may be undertaken by representatives appointed under Power of Attorney.

Is a tax identification number, or equivalent, required? If so, how is it obtained?

The Company is provided with a company number at the time of application for the Company's name certificate. Such number will identify the Company before all authorities, including the tax department (Autoridade Tributária e Aduaneira).

What is the title of the applicable company registry?

Commercial Registration Office (Conservatória do Registo Comercial).

What types of information must be filed at the (company) register, and which of them will it be publicly available, e.g.: Articles or other formation document, Articles or other formation document, Group structure, Share capital, Directors, Accounts, Insolvency, good-standing, liquidation, Liens and encumbrances on the shares, Liens and encumbrances on assets of the entity, Other (e.g. litigation, tax matters)

The following information must be provided and is publicly available at the Commercial Registry:

• Articles of Association and incorporation documents;
• Date of incorporation;
• Business purpose,
• Share capital;
• Corporate Bodies' (Órgãos Sociais) members and their names, addresses and taxpayer numbers;
• Annual Accounts;
• Insolvency, dissolution and liquidation; and
• Court procedures subject to registration.

Furthermore, information regarding the Ultimate Beneficial Owner is also available on the official website.

What is the title of the executive body and its members? What are their main duties, tasks and responsibilities?

Board of Directors and Directors.

The Board of Directors represents the company and must carry out the management of the Company and its commercial activity and, whenever provided by Law, follow the Shareholders' resolutions, and the Audit Board (Conselho Fiscal) or Commission's (Comissão de Auditoria) interventions.

The Board of Directors has exclusive and full powers to represent the Company.

How are the members of the executive body appointed, dismissed and replaced?

Initially, the members of the Board of Directors are appointed at the incorporation of the Company or at the founding Shareholders General Meeting and afterwards may be appointed by a resolution adopted by the Shareholders General Meeting (Assembleia Geral de Acionistas).

Generally, members of the Board of Directors are dismissed and replaced by a resolution adopted by the Shareholders General Meeting or termination of their mandate.

Members of the Executive Board of Directors (Conselho de Administração Executivo), if not appointed under the Company's Articles of Associations, are appointed by the General and Supervisory Board (Conselho Geral e de Supervisão) or by the Shareholders General Meeting, if so, provided by the Company's Articles of Association.

Generally, the members of the Executive Board of Directors are dismissed by the appointing corporate body.

Is it possible to appoint corporate directors or must all directors be natural persons?

Yes, it is possible to appoint an entity as director. However, where a legal person is appointed as a director, it shall nominate a natural person to act on its behalf.

Is there a requirement to have non-executive directors? How are they appointed, dismissed and replaced? Do non-executive directors serve on a separate body (two-tier structure) or can a one-tier board (with executive and non-executives) be appointed, or is some alternate structure used?

Generally, no.

There are alternative governing structures:

• Board of Directors (or sole director if the Company's share capital does not exceed €200,000);
• Board of Directors (including an Audit Commission); and
• Executive Board of Directors (or sole director if the Company's share capital does not exceed €200,000) and a General and Supervisory Board.

The Company's Articles of Association may provide for the appointment of an Executive Commission (Comissão Executiva) by the Board of Directors, established with delegated powers in compliance with legal restrictions.

What is the title of the body of owners / shareholders / members, and what are the main tasks / responsibilities / powers of that body?

The Shareholders General Meeting (consisting of shareholders or other parties holding equivalent rights) with the capacity to act on the matters provided by law and by the Company's Articles of Association.

Generally, the main rights are those with respect to amending the Company's Articles of Association, the appointment, replacement and dismissal of members of the Board of Directors, share capital changes, assets and profits distributions, and dissolution and liquidation.

What are the majority and quorum requirements for decisions by the shareholders? Can they be varied or changed?

The Shareholders General Meeting may adopt resolutions with the presence of any number of shareholders except when deciding on specific matters requiring a qualified majority (by law or by the Company's Articles of Association), in which case at least one-third of the share capital must be present or represented.

If not provided otherwise under the Company's Articles of Association, each share represents one (1) vote.

Unless provided otherwise by Law or by the Company's Articles of Association, shareholders' resolutions are passed by an absolute majority of the votes cast.

Any special governance regimes (e.g. depending on size, being listed at a stock exchange, or other criteria)?

The appointment of an Audit Board and an external Auditor is mandatory for (i) Corporations listed on a stock exchange, and (ii) for Corporations (without a sole shareholder which adopts such audit structure) if two (2) of the following limits are exceeded (for two (2) consecutive years): (i) Total balance sheet € 20,000,000; (ii) net turnover €40,000,000; and (iii) average number of employees equals at least 250.

Additionally, listed corporations must appoint a Company Secretary.

What are the periodic accounting obligations incumbent upon the entity? To whom must those accounts be submitted?

Generally, the Shareholders General Meeting must approve the annual accounts within three (3) months counted from the end of the financial year to which they refer, or within five (5) months from the same date in the case of companies required to present consolidated accounts or that apply the equity accounting method.

Accounts must be filed with Simplified Company Information (Informação Empresarial Simplificada – IES) by the 15th day of the 7th month counted from the end of the financial year to which it refers.

Is the entity permitted to determine its own financial year?

Yes, subject to notice to Tax Authorities.

Is the entity subject to any statutory (external) auditor obligations?

The appointment of an Audit Board and an external Auditor is mandatory for (i) Corporations listed on a stock exchange, and (ii) for Corporations (without a sole shareholder which adopts such audit structure) if two (2) of the following limits are exceeded (for two (2) consecutive years): (i) Total balance sheet €20,000,000; (ii) net turnover €40,000,000; and (iii) average number of employees equals at least 250.

Requirements to appoint other persons (officers, secretary, internal auditor / accountants). If so, what are their functions? Are there any residency requirements?

The appointment of a Company Secretary (Secretário) is not mandatory except for a stock exchange listed Corporation.

The secretary, among other duties, acts as secretary of the meetings of Corporate Bodies (Órgãos Sociais), prepares the minutes, records the Company's books, and certifies signatures and copies of the Company's documents.

No residency requirements exist but all members of corporate bodies must obtain their own Portuguese taxpayer number and, if the country of residence of the referred members is outside the European Union, the appointment of a tax representative in Portugal will also be required.

What is the title designated for 'ownership interests' (e.g. shares, quota, interests, membership)?

Shares (Ações).

Are different classes of ownership interests possible? If so, what are some examples of different classes?

Yes, the Corporation's Articles of Association may establish that specific shares are entitled to different rights such as those pertaining to dividends.

Shares with the same rights form a class of shares.

What documentation is required for the transfer of ownership interests?

A private contract of transfer of shares signed by the parties is required. The transfer of shares will require an additional formality, which will differ depending on whether they are titled shares (ações tituladas) or non-titled shares (ações escriturais). When shares are titled, they are transferable by endorsement on the share certificate followed by registration before the Issuer. Conversely, when shares are non-titled, they are transferred by registering them in the acquirer’s account, which is updated by the financial intermediary that holds them.

Are there any additional formal requirements required for the transfer of ownership (notary, approvals, stamping, filings, corporate records)?

The Company's Articles of Association may impose restrictions on the transfer of shares, providing, for instance, for Shareholders' pre-emptive rights or prior consent from the Company.

Are there any applicable stamp duties imposed when transferring ownership interests?

No.

How are shares issued? (including information on payment obligations, registration requirements)

The initial number of shares and their respective value must be defined in the incorporation agreement.

Changes to the Company's share capital are subject to Shareholders General Meeting Resolution (deliberação em Assembleia Geral de Sócios)..

Further information on equity contributions, e.g., non-cash payments on shares, (share premium) contributions without issuances of shares, can partially paid shares/ownership interests be permitted and what are the restrictions on them?

The payment of the shares value may be made in forms other than cash, subject to a prior report on the relevant assets and their valuation issued by an independent auditor.

Additional payments are possible if so provided by the incorporation agreement.

Yes, share premium contributions (ágio) without the issuance of ‘ownership interests’ are possible.

Any requirements with respect to share cancellation, share repurchase and other capital reductions

Share cancellation is possible subject to legal requirements including but not limited to a prior Shareholders' resolution and equity availability.

Share repurchases are possible, subject to legal requirements and conditions provided by the Company's Articles of Association.

Capital reductions are possible, subject to legal requirements and conditions provided by the Company's Articles of Association.

Any requirements with respect to distributions to shareholders?

The Shareholders General Meeting must resolve on approving a dividend distribution subject to legal and statutory reserves.

Can the owners or shareholders adopt a restrictive or governing agreement among themselves such as a Shareholders Agreement?

Yes, a shareholder agreement (acordo parasocial) may be executed by the shareholders and will be enforceable between the signatory parties.

Which are the typical annual maintenance costs of maintaining the existence and legal good standing of such an entity (excluding legal fees)?

The company must maintain its business address and have members of its corporate bodies. The shareholders must hold their annual general meeting each year (or adopt a resolution in writing). In addition, annual accounts must be prepared and adopted each year and the applicable tax filings must be made.

What are the general corporate tax rates? (Specify if there is a national versus local distinction).

Generally, 20% of income tax is payable for taxable profits. This rate is applicable to tax periods beginning on or after January 1, 2025, as it was established under the amended wording of the State Budget Law (Lei do Orçamento do Estado), dated December 31, 2024. Local tax (Derrama) may apply in addition up to 1.5%. State tax (Derrama) may apply in addition up to 3%, 5% and 9%, depending on whether the taxable income in euros exceeds 1,500,000 up to 7,500,000; exceeds 7,500,000 up to 35,000,000; or exceeds 35,000,000

Various specific rules and provisions are deemed applicable.

Summary of any specific matters, e.g. recent or prospective major legal developments

No regime changes are expected for corporations during 2025.

Corporations are one of the most common types of companies existing in Portugal..