Portugal
Answer ... Banks must obtain authorisation from the Bank of Portugal under the terms set forth in Articles 14 and following of the Legal Framework of Credit Institutions and Financial Companies, and must also follow the process for incorporating and registering a commercial company.
Banks can carry out a wide range of activities, set out in Article 4, paragraph 1 of the Legal Framework of Credit Institutions and Financial Companies.
Banks that are legally operating in one EU member state and that intend to provide services in Portugal must follow the applicable procedure within the scope of freedom of establishment and/or freedom to provide services, as appropriate.
Banks must additionally be registered in a special register with the Bank of Portugal. The same applies to branches or representative offices in Portugal of banks authorised in a foreign country.
Once authorisation has been obtained from the Bank of Portugal, banks must seek a specific registration for the provision of investment services and ancillary services with the Portuguese Securities Commission, where appropriate. The registration process with the Portuguese Securities Commission is accompanied by a thorough evaluation of the human, technical and material resources of the bank.
Portugal
Answer ... In general, banks and other credit institutions based in Portugal must satisfy the following requirements:
- They must correspond to one of the types provided for in Portuguese law.
- They must adopt the form of a public limited company, with the exception of mutual agricultural credit banks and corresponding savings banks.
- Their stated purpose must be to carry out activities legally permitted under the terms of Article 4 of the Legal Framework of Credit Institutions and Financial Companies.
- Their share capital must not be lower than the legal minimum, mandatorily represented by registered shares, with the exception of mutual agricultural credit banks and attached savings banks.
- Their main and effective administrative headquarters must be located in Portugal.
- They must implement solid internal rules on corporate governance, including a clear organisational structure with well-defined, transparent and coherent lines of responsibility.
- They must have in place effective processes for the identification, management, control and communication of the risks to which they are or may be exposed.
- They must have in place adequate internal control mechanisms, including sound administrative and accounting procedures.
- Their remuneration policies and practices must promote and be consistent with sound and prudent risk management.
- The suitability, professional qualifications, independence and availability of the members of the management and supervisory bodies must guarantee the sound and prudent management of the credit institution.
Portugal
Answer ... Banks must submit a request for authorisation to the Bank of Portugal, accompanied by the documentation set forth in Article 17 of the Legal Framework of Credit Institutions and Financial Companies.
The request for authorisation will be evaluated by the Bank of Portugal in collaboration with the European Central Bank.
Once authorisation has been granted for the constitution of the bank, interested parties must implement the means and conditions for undertaking the authorised activities.
Upon receiving authorisation from the Bank of Portugal, interested parties must register the bank in a special register with the Bank of Portugal. The special register covers the elements set forth in Article 66 of the Legal Framework of Credit Institutions and Financial Companies.
The decision of the Bank of Portugal must be notified to the interested parties within six months of receipt of the application or, if applicable, receipt of any additional information requested from the applicants; but in any case within 12 months of the date of initial delivery of the application. If the Bank of Portugal fails to respond within these timeframes, this gives rise to a presumption of tacit rejection of the request.
Upon receiving authorisation from the Bank of Portugal, the banks must seek registration for the provision of investment and ancillary services with the Portuguese Securities Commission, if it intends to pursue such activities.
According to Article 299 of the Portuguese Securities Code, registration with the Portuguese Securities Commission is deemed to have been refused if it is not granted within 30 days of:
- the communication of authorisation; or
- the date of receipt of either the request or any supplementary information requested.
In practical terms, it can take between 18 months and two years to prepare the application file and obtain the necessary authorisations and registrations with the Bank of Portugal and the Portuguese Securities Commission.