Portugal ranks among the top 10 safest countries globally, holding the sixth position in the Global Peace Index in 2023. It also has a low level of corruption, ranking 34rd out of 180 countries in the Corruption Perceptions Index for 2023, with a score of 62.
Foreign nationals can be founders & owners of Portuguese company, even without permanent residency, making the setup process straightforward. Portuguese companies benefit from all advantages of European businesses, including trade with other registered EU companies and access to unified European VAT system.
Portugal has a developed tech ecosystem and a rapidly growing startup sector. The government offers various incentives for tech firms, tax benefits, financial support for innovative projects.
Choosing a business structure
Portugal companies can be either private or public, with different registration and operational requirements. The most common type is a private limited company (Sociedade por Quotas, LDA), similar to an LLC.
- Requires a minimum of two founders, each responsible for a share of the capital
- At least one director is needed
- No min. capital requirement; shares must be worth at least €1 each
- Only registered shares are permitted
- Standard set of documents, unique name, and description of future activities
- Owners hold quotas described in the company’s Articles of Association. Previously, minimum capital was €5,000, now reduced to €1,000. LDA is exempt from annual audits if it meets two out of three criteria for two consecutive years:
- Assets below €1.5 million
- Income under €3 million
- Fewer than 50 employees
- Suitable for larger ventures:
- Minimum of 5 founders
- Minimum capital of €50,000
- More complex structure, suitable for medium to large enterprises with high investment levels
- Shareholders’ liability is limited to their contributions
Both forms have distinct benefits and requirements. Choice depends on the scale, number of founders, and plans for growth and investment. Most clients choose to register as LDA business in Portugal.
