Portugal

• 15/10/2020
• Jurisdictions

Portugal’s FDI screening mechanism is found in the Decree-Law No. 138/2014 (the Portuguese Act). It provides for sectoral screening in the energy, transport, and telecommunication sectors. The mechanism has been in place since 2014 and establishes an ex post opposition screening regime although an interested party may also request an ex ante confirmation from the Portuguese government. The authorities responsible for FDI screening in Portugal are the respective Ministries responsible for the energy, transport and communication sectors and the Portuguese Council of Ministers.

Scope

The Portuguese FDI screening mechanism is triggered if (i) the transaction results, directly or indirectly, in the acquisition of direct or indirect control over strategic assets; and (ii) the person(s) acquiring such control are third-country nationals, i.e. they are domiciled in or their statutory headquarters or effective place of business is in a non-EU or EEA country.

Review criteria

The responsible Ministry assesses whether a transaction poses an actual and sufficiently serious threat to national defence and security or to security of supply of services that are fundamental to the national interest.

Application procedure

The FDI screening mechanism does not impose a mandatory notification procedure. However, a person wishing to acquire control over strategic assets may request a confirmation from the Ministries responsible for the sector to which the strategic assets belong that no opposition decision will be taken (ex ante clearance). The request must describe the terms of the transaction and submit documents and information upon request of the relevant Ministry.

Implementation and government practice

The respective Ministries responsible for the sector in question may within initiate an investigation ex officio to assess the risks which a transaction may pose. If an investigation is launched, the person(s) acquiring control are required to present relevant information and documents about the transaction in question to the relevant Ministry. The Portuguese Council of Ministers, based on the proposal of the member of the Portuguese government in charge, may decide to oppose the investment.

Due process

The Council of Minister is required to substantiate its decision. The opposition decision of the Council of Ministers can be challenged in a court, pursuant to the Code of Administrative Procedure.

Time limits

The request for ex ante clearance must be submitted at least 90 days before the transaction in questions is expected to be concluded. It is deemed to be approved if the Government does not provide an answer and does not notify the initiation of the investigation with respect to the transaction in question within 30 days from the receipt of the request.

After initiation of a screening ex officio, the Portuguese Council of Ministers, based on the proposal of the member of the Portuguese government in charge, may decide to oppose the investment within 60 days after receipt of all requested information and documents. If no opposition decision is issued within this time limit, is deemed to be a decision of non-opposition.

Sanctions

In the case of an opposition decision, all contracts and legal acts pertaining to the investment become null and void, including those related to economic exploitation of or the exercise of rights over assets or entities that control them.

Legislative developments

Currently, there are no legislative developments in Portugal related to FDI screening.

 

The above information is a summary that does not constitute legal advice. For exhaustive information, advice, and assistance please get in touch with our lawyers.