Portugal briefing: Business entities

As part of our series of articles about doing business in Portugal this briefing note covers what types of business entities are options in Portugal.

ILS World has a great deal of experience assisting clients on the most appropriate trading structures – one of the most popular is a limited liability company.

In order to incorporate a small or medium business with a limited amount of capital and a liability limited by the contribution to the capital, investors can consider to form a private limited company (sociedade por quotas - Lda)in Portugal.

The Lda must be established by at least two founders with a minimum share capital of €5,000 in a Portuguese bank account. All the shareholders must contribute to the capital and their liability is limited to that contribution. The management is assured by a director appointed by the general meeting of the shareholders, the supreme authority in the Portuguese Lda.

Other, rarely used structures include:

  • A limited partnership (sociedade em comandita - SC)is formed by a minimum two partners, at least one must be general and have full liability for the company's obligations (socios comanditarias), while the other one will have limited liability and must deliver capital to the partnership (socios comanditados).
  • A general partnership (sociedade em nome collectivo - SNC) has two partners with full liabilities in the firm. They are equally responsible for making decisions in the name of the entity and can manage the company. No minimum share capital is necessary for this type of business.
  • Another form of business established with no requirements for share capital is the company with a single shareholder (EIRL). The founder of such a company is liable with his personal assets for the entity's debts.

If the founders have a higher amount of capital, they can incorporate a public company (sociedade anónima - SA) which is a large company created by investors who provide a minimum share capital of €50,000. At least five shareholders are necessary to incorporate this type of business and their liability is limited to their contribution to the capital. In this type of Portuguese business, the management is assured by a board of directors which is monitored by a supervisory board, both invested by the general meeting of the shareholders.

ILS World has a great deal of experience in company formation and management services. Whether your world is onshore, offshore or both we can assist in helping you achieve your objectives with great tax efficiency and cost effectiveness. The office works in Portuguese, English, Spanish and French.

Why choose ILS World

As a leading provider of independent fiduciary services to professional advisors, corporate groups, private and digital clients, we are here to help achieve your financial goals.

At ILS World, we don’t restrict ourselves, we like to go beyond the borders. That is why we operate globally. You will find our offices in Isle of ManBritish Virgin IslandsHong Kong, and Portugal.

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Paulo Réfega
Managing Director
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