How to Open a Company in Portugal: 5 Steps!
Do you have a business idea ready to come out of the drawer? Then it’s time to consider opening a company.
How to Open a Company in Portugal?
The Portuguese Government has simplified this process and you essentially two practical ways to open a company: the Company on time and the Online Company. In this article we will guide you through the 5 essential steps to open company in Portugal considering these two channels.
1# Draw up a Business Plan
The business plan is not just essential to start a business. It makes the company more robust and ready for the challenges it will face, from the opening to the company expansion.
It is this plan that identifies the financial viability of the company, which structures the entire business, that defines the strategy and marketing plan of its products or services, among many other essential points.
In this article we prepare you a list of 9 questions you should ask to design your business plan.
2# Define the legal form of the company
The legal form of a company in Portugal is divided into two segments. On one hand, we have the legal forms of companies consisting only of a (singular) partner. On the other the companies constituted by more than one partner (collective).
If you open a company as a singular, there are 3 legal forms:
- Entrepreneur in Individual Name.
- Unipersonal Company by Quotas.
- Individual Establishment of Unlimited Liability.
If you open a company as a collective, there are 4 legal forms:
- Limited Company (2 or more members).
- Public Limited Company (at least 5 members).
- Society in Commandant.
- Cooperative (non-profit and with at least 2 members)
All legal forms impact in different ways the liability of the partners in capital, assets, and eventual debts of the company.
To correctly define the legal form of the company, developing the business plan is essential. It will help you get a clear view of where you’re going. In addition, it is advisable to use the know-how of an accountant.
3# Gather all the necessary documentation: Company on Time vs Online Company
In Portugal, the most practical ways to open a company are the Company on Time counters or the Online Company portal.
The moment you are opening a company at the Company on Time counters, if you open a company as a singular, you just need to bring with you the Citizen Card. If it is a collective company, all members must be present at the counter (or legally represented with power of attorney) and bring with them:
- Citizen card.
- A legal person’s identification card or the e-card access code.
- Minutes of deliberation of the General Meeting that empower legal representatives to create the company.
- Certificate of deed or document of constitution or updated social pact of the collective entities.
If you choose to open an online company, it is enough that the member/s have a citizen card with digital signature or digital mobile key. Access this service through the official website of the Government of Portugal.
In addition to these documents, you will need to choose a pre-approved social pact template or prepare one for your company.
If you choose a pre-approved social pact model, you do not need to complete it in advance. Just indicate which one you chose at the time you’re opening a business. You can view these pre-approved pact templates on the official website here.
Finally, we must not forget the name in the case of a collective company. For a simple process, you must choose a firm name from this pre-approved list. Remember that the name you choose here is just the formal, bureaucratic name. The name you display to the public may be different. If you prefer not to choose the name of the firm through this list, you will need to make your proposal to the National Register of Legal Persons and wait for the approval and issuance of the certificate.
If you are an Entrepreneur in Individual Name, it will be the full or abbreviated name of the founder.
4# Select an Official Account Technician
If you are opening a company in one of the legal forms of the Company, you will need an Official Account Technician (TOC).
You can indicate a TOC you have previously chosen or choose one through the TOC Exchange. It is this professional who signs his declaration of commencing business activity that should be delivered to finance. In addition to TOC, you will need to obtain billing software certified by the Tax Authority.
Please note that even if you start your activity as an Individual Entrepreneur, if you get a net annual income of more than €200,000, you will also need an Official Account Technician.
5# Open a bank account
Once you open a company through the Company on the Hour or Online Company, you have 5 days to deposit the company’s share capital into your bank account.
Choosing the bank will also influence the quality of any bank financing that your company may need. Learn how to get the best bank financing conditions here.
